Growing a healthy economy in northern idaho Who I am, who Headwaters is, why we are working in Bonner County Outline: Things are going well and why they are going well, what changes are coming economically and demographically, and how to sustain success with coming changes Megan Lawson, Ph.D. Headwaters Economics

Today’s presentation Health Care + Robots + Lakes, Rivers, Mountains = SUCCESS Covering three apparently disparate things, but together they help explain Northern Idaho’s success (Robots: referring to the automation Sam referred to)

Northern Idaho bucks rural trends Population, 1970-2014 The rural West is losing population and jobs are becoming ever more concentrated in metro places. In Idaho, half of the jobs are in 3 counties: Ada & Canyon (Boise) and Kootenai. We look at population trends as one of the most telling measures of a rural place. Do people want to be there? Northern Idaho is bucking population loss trends in rural places, but also the big booms and busts of commodity dependent or resort communities Different from our Three Wests research of rural, isolated communities

What’s driving this success? (Tangibles) Employment by Industry, Bonner County Retail Zoom in to the last 14 years Diverse economy Steady tourism backbone Top 5 private sectors: Retail, Manufacturing, Construction, Health care, Accommodation and food services Growth in new sectors (health care, biomed, manufacturing, aerospace) as others have declined (forest products) Health care: 404 new jobs since 2000, share has increased over time and likely will increase more Note manufacturing: dipped after recession but has since recovered and is growing. This is very unique to Sandpoint and I will come back to this during the Robot section of this talk.

What’s driving this success? (Intangibles) Why did you move to or stay in the area? How to measure quality of life? People want to be there. It’s not because it’s close to markets, a major airport and it’s easy to do international or national business from there. Businesses with broad reach are here because they want to be Cite our economy report

What will the future look like? Staying the same is not an option due to macroeconomic changes and demographic changes

Future economy: automation All sectors Jobs Value There are jobs today that didn’t exist 20 years ago. Historically as production increases, so do jobs. But that is changing, particularly in some sectors due to increasing productivity and automation.

Future economy: automation Health Care Jobs Value

Future economy: automation Manufacturing Value Jobs Automation has increased how much one person can produce. Great for our overall economy but makes it difficult for those working in these sectors and the communities that depend on these sectors. Remember what is happening in manufacturing employment here: it’s going up. This is a testament to the strength of this sector here, also that it is in innovative fields.

Future economy: innovation & people Productivity has increased in goods- producing sectors, especially commodities Productivity has decreased in people- intensive services Oxford study: what jobs are most likely to be automated in the next 20 years. 47% of US jobs are at risk, with the least susceptible jobs requiring “high creative and social intelligence.” Most likely: data entry keyers (99%) Least likely: recreational therapists (0.28%), healthcare social workers (0.35%) Economists: 43% What does this mean for Sandpoint? Invest in people and innovation. Invest in the industries and jobs that require innovation and human connection (health care, biotech, aerospace, software). This is national data – much of the manufacturing in Sandpoint is in more innovative industries. Area is well-positioned for small scale, R&D-type manufacturing.

Investing in people: An economic asset “In the twentieth century, competition was about accumulating physical capital. Today it is about attracting the best human capital.”

Planning for people: Growth is happening Maintaining rural character is invaluable Housing affordability: keeping good people, families, and attracting new businesses Maintaining shared priorities for natural assets Protect your strengths: the people and the place Keeping and attracting the innovators and entrepreneurs that create jobs Where are people going to live but maintain rural character? Foreshadow Aaron. Ensuring that residents and new residents are connected to the rivers, lakes, outdoors that keeps many of you here. Foreshadow Suzanne’s ParksRx

Conclusions Northern Idaho is thriving due to the quality of its people and the place Well-positioned to invest in innovative industries and jobs Quality of life is a central economic asset to be included in business, land use, transportation, public health planning Focus on maintaining the quality of people and place, investing in the place to keep people

Contact megan@headwaterseconomics.org 406.570.7475