Evaluating Tallahassee’s Future in the New Economy Tim Lynch, Ph.D., Director Julie Harrington, Ph.D., Asst. Dir. Center for Economic Forecasting and Analysis Florida State University May 2, 2002

What are the attributes of the New Economy? An increased trend towards globalization. Increased levels of business growth, flexibility and competition driven by information technologies (IT). Higher levels of entrepreneurial activity and creativity. Higher levels of productivity and income dispersion and quality of life.

What is the New Economy Index? The New Economy Index evaluates and compares the “high tech economic” strength of US Metropolitan Areas (MSA). The 50 largest US MSAs have been evaluated and ranked. Tallahassee and 268 medium and smaller cities have not been evaluated. This study will evaluate Tallahassee and 19 other Florida metro areas with the New Economy Index.

Goods Services Capital Productivity Profits Low cost production Strong economy Entrepreneurs Old Economy People

Goods Services Capital Higher productivity Higher wages Higher quality of life Higher profits Entrepreneurs More resilient economy Higher efficiency Higher wealth New Economy People

WHAT ARE THE ATTRIBUTES OF THE “OLD ECONOMY”?

1.People Measures Per capita income Average earning Unemployment level Training level Labor productivity Old Economy

2.Capital Measures Infrastructure value Investment level Capital Productivity Land value Old Economy

3.Entrepreneurs Measures Number of new companies Investment rate Profit level R&D level Old Economy

WHAT ARE THE ATTRIBUTES OF THE “NEW ECONOMY”?

1.People Measures % Of managerial, professional and technical jobs Level of workforce education % Of high-tech jobs # Of degrees granted in science and engineering % Of online adult population New Economy

2.Capital Measures Broadband telecom capacity Computer use in schools Commercial internet domain names Internet backbone New Economy

3.Entrepreneurs Measures % of gazelle jobs % of job churning # of patents $ amount of academic research $ amount of venture capital # of new publicly traded companies New Economy

22% 29% 42% 54% 13% 7% $0 $100 $200 $300 IT % of All US Private Investments Old economy New economy % 20% 40% 60% Source: Chase Econometrics, US Worker Hourly Manuf Production % IT Investment Rate US Manufacturing Worker Hourly Production Value Vs The It Investment Rate (Constant 2002$)

New Economy Index Measures

KNOWLEDGE JOBS

Knowledge Jobs Managerial Professional Technical Jobs

Knowledge Jobs Workforce Education

GLOBALIZATION

Globalization Export Focus Manufacturing

ECONOMIC DYNAMISM

Economic Dynamism Gazelles % Fast Growing Companies

Economic Dynamism Job Churning Job Gain & Loss Rate

Economic Dynamism New Publicly Traded Initial Public Offerings

THE DIGITAL ECONOMY

The Digital Economy Online Adult Population

The Digital Economy Broadband Telecommunications Capacity Source: FCC Web Site:

The Digital Economy Computers Used In K-12 Schools

The Digital Economy Commercial Internet Domain Names

The Digital Economy Internet Backbone Capacity

INNOVATION CAPACITY

Innovation Capacity Level Of High Tech Jobs

Innovation Capacity Degrees Granted In Science & Engineering

Innovation Capacity Patents Issued

Innovation Capacity Academic Research & Development Funding

Innovation Capacity Venture Capital Funding Levels

FINAL TALLAHASSEE RANKING

Tallahassee’s Final Ranking Among The US MSAs Evaluated TALLAHASSEE RANKS 11 th OUT OF 66 US MSAs EVALUATED

GLOBALIZATION NATIONAL RANK EXPORT SALES 61 THE DIGITAL ECONOMY BROADBAND TELECOM CAPACITY66 ECONOMIC DYNAMISM # OF NEW PUBLICLY TRADED IPOs60 JOB CHURNING45 INNOVATION CAPACITY VENTURE CAPITAL63 PATENTS58 Tallahassee has an opportunity to build strength in:

RECOMMENDATIONS Business and government must partner together to expand : Broad band high speed Internet access to all business, educational and residential need. Business community access to venture capital. Regional creative innovation, business formation and trade efforts and job creation.

KNOWLEDGE JOBS NATIONAL RANK HIGHLY EDUCATED WORK FORCE 2 MANAGERIAL, PROFESSIONAL, TECH19 THE DIGITAL ECONOMY INTERNET SUPERHIGHWAY LINKAGE 2 ONLINE POPULATION 7 ECONOMIC DYNAMISM GAZELLES 11 INNOVATION CAPACITY DEGREES GRANTED IN SCIENCE & ENGINEERING 2 ACADEMIC RESEARCH & DEVELOPMENT FUNDING 3 Tallahassee has a strength in:

RECOMMENDATIONS Business and government must partner to: Build on our strengths - high levels of professional/technical jobs and a highly educated, online-savvy workforce, student base and general population. Communicate to prospective and existing businesses Tallahassee’s strong “high tech” ranking, Internet access and dynamic economy. Convert our excellent science, engineering and research capabilities into commercially viable local ventures.