In This Week's Issue
SSTI Special Election Series
FL Candidates on Job Creation,
Energy Independence
Florida is one of many states without an incumbent governor
participating in the 2010 gubernatorial election, as Gov. Charlie
Crist, who served just one-term in office, will seek an open
Florida U.S. Senate seat this fall in a race against former Florida
House Speaker Marco Rubio and Democratic U.S. Rep. Kendrick Meek.
Crist is running as in Independent. Policy aimed at job creation is
the topic of much debate in Florida, where unemployment is around
12 percent. Gubernatorial candidates Rick Scott (R) and Alex Sink
(D) recently provided detailed jobs plans and outlined proposals to
achieve energy independence, which are highlighted in the second
installment of SSTI's special election
series.
Rick Scott
(R)
A health care executive and navy veteran, Rick Scott is focusing
his campaign around a seven-step economic plan that he says will
create jobs and allow Florida to become a job creation model for
the nation. In seven years, the
7-7-7 economic plan aims to create 700,000 jobs and generate
$74 billion in state GDP, $41 billion in higher personal incomes,
and $1 billion in total state revenues as a direct result of
increased economic growth. Investing in the
state's universities, phasing out the business
income tax, reducing property taxes, and enacting regulatory
reforms are included in the plan.
To grow and retain jobs, Scott would continue to invest in the
Innovation Incentive Fund, established in 2006 under Gov. Jeb Bush
to attract major life sciences institutions and create high-tech
jobs. In the past few years, the fund has lured Scripps and Burnham
research labs to the state. Lawmakers recently replenished the fund
with $75 million in the FY11 enacted budget (see the June 9,
2010 issue of the Digest). His plan also includes
nurturing new cutting-edge technology clusters, such as the
biotechnology cluster in Orlando. To eliminate overlapping economic
development agencies, Scott would designate one group to assist
local economic development agencies and serve as the statewide
recruitment agency.
Citing a world-class university system as necessary to
establishing a workforce capable of enhancing the
state's technology sectors, Scott would invest
in university research, laboratories, business incubators and
technology transfer. Although no specifics on funding or action
items are outlined, the plan refers to connecting university
research to the state's economic development
process and leveraging investments in the
state's medical colleges to invest in new or
emerging technologies.
Scott supports expansion of nuclear power, use of alternative
fuels and off-shore drilling, according to his campaign website.
However, details for obtaining energy independence are not
included.
Alex Sink
(D)
In her bid for governor, Alex Sink unveiled a two-part economic
recovery plan for the state, detailing three steps state government
can take to help small businesses recover in the short-term and a
vision for expanding and diversifying Florida's
economy in the long-term. Sink is Flordia's
chief financial officer and a former bank executive. To stabilize
and expand small business, Sink's plan calls for
improving small business access to capital, including incentives
for venture capital investing and micro-loans; creating a small
business ombudsman in the Office of the Governor to oversee and
coordinate issues affecting small businesses; and, encourage small
and startup businesses by pushing to defer state corporate income
taxes of qualified startup companies for the first three years.
Sink's short-term plan also includes enacting
tax incentives aimed at job creation, including providing a
corporate income tax tied to job creation. Last week at a
Tallahassee workforce center, Sink proposed an $8,800 tax break for
any company that creates a new job, reports Central Florida News
13.
Investing in energy technology and medical services industries
is part of Sink's long-term strategy for
remaking the state's economy. She proposes to
expand R&D and commercialization of new products through
R&D tax credits for in-state investment. Florida is one of 19
states that do not offer this incentive, according to her campaign
website.
Sink's strategy to achieve energy
independence is tied to job creation in green technology sectors
and focuses on moving energy technologies from the lab to the
marketplace by expanding public-private partnerships already being
fostered through the state's research
universities. An example of such a partnership exists between
Florida Atlantic University, the state of Florida, and the U.S.
Department of Energy, all of which are collaborating on an ocean
energy project, according to Sink. Other proposals include adopting
a statewide renewable portfolio standard and retooling the
workforce for the renewable energy sector by seeking federal
resources through the U.S. Department of Labor. Sink points to
Michigan's No Worker Left Behind initiative as a
model.
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SSTI News and Analysis
Companies that Perform R&D are More Innovative, Says NSF
Companies that engage in R&D activities —
either through performing R&D or funding others to perform
R&D — are far more likely to innovate than
companies that do not, according to new data from
the National Science Foundation's (NSF) 2008
Business R&D and Innovation Survey (BRDIS). NSF researchers
found that companies with R&D "exhibit far
higher rates of innovation than do non-R&D companies. However,
only 47,000 (3%) U.S. companies engaged in
R&D activities from 2006 to 2008. Among those R&D active
companies, 66% reported at least one product innovation and 51% reported at least one new
process innovation. In contrast, of the almost 1.5 million
non-R&D companies, only 7% reported new product innovations
and 8% reported new process innovations. The BRDIS data also
indicates that there is a clear positive relationship between
R&D spending and increased instances of product or process
innovations.
Manufacturing companies reported high instances of innovation
(22% reported new product innovations and 22% new product
process innovations) performed better than U.S. companies (9% in
product innovations and 9% in process innovations) in general.
Manufacturing sectors that had high product innovations include
chemicals (41%), computer/electronic products (45%) and electrical
equipment/appliances/components (37%). Only two manufacturing
sectors also had high instances of companies with process
innovations. They were Chemicals (34%) and computer/electronic
products (33%) sectors.
Nonmanufacturing companies reported slightly fewer product (8%)
and process innovations (8%) than the national averages. In this
survey, most sectors had 10% or less of companies actively engaged
in innovation. In the health care services sector, only 10% of
companies reported process innovations. Only 8% of
Finance/insurance companies reported product or process
innovations. The only nonmanufacturing sectors to report high
instances of product development were the information (30%) and
some sub-sectors of professional/scientific/technical/related
services reported high instances of innovation. These sectors with
high innovation were typically related to software or IT development.
Process innovation in the nonmanufacturing sectors also was very
low. Only software publishers (54% percent of companies reported
new process innovations) showed significant signs of innovation.
Read the
release ...
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Europe to become a "True Innovation
Union"
The European Commission has released the first comprehensive
innovation strategy for the European Union. The strategy has over
thirty action points including the development of European
Innovation Partnerships, improving access to finance, creating a major
research program on the public sector & social innovation and
modernizing Europe's intellectual property
rights regime. European Innovation Partnerships would step up
R&D, coordinate investments, speed up standards and mobilize
stakeholders in areas that tackle major challenges faced by the EU to
become a world leader in innovation. Proposed projects include
public health, energy, "smart" cities and mobility, water
efficiency, non-energy raw materials and sustainable &
productive agriculture. Under this strategy, the EU wants to
achieve investments in R&D totaling 3% of the
EU's GDP by 2020. If this goal is achieved, the
European Commission projects 3.7 million jobs would be created and
annual GDP would increase by €795 billion ($1.1
trillion) by 2025.
Read the release ...
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Brookings Explores Cluster-Based Frameworks
for Economic Development
Regional innovation clusters can be a useful
framework in understanding the high-tech economy, but only if local
leaders recognize the limits of cluster-based strategies, according
to a recent study by the Brookings Institution. Authors Mark Muro
and Bruce Katz suggest that research has confirmed the positive
impact clusters can have for local workers, firms and regions, but
that effective policy interventions must focus on targeted
initiatives to foster existing clusters. Clusters cannot be created
out of nothing, and regional efforts should instead help to develop
clusters where there is evidence of under-performance. Read
"How Regional Innovation Clusters Can Foster the
Next Economy" at: http://www.brookings.edu/papers/2010/0921_clusters_muro_katz.aspx.
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NSF Outlines STEM Recommendations in New Report
A recent report from the National Science
Foundation's (NSF) National Science Board calls
for a new NSF research agenda to identify and develop the next
generation of STEM innovators. The board developed a STEM agenda
built on findings from a two-year study on math, science and
engineering education in the U.S. The report, entitled "Preparing the Next
Generation of STEM Innovators," provides
recommendations that are intended to help set funding priorities at
NSF for STEM education in the coming years. Overall,
the board's report encourages policymakers to
view STEM and innovation issues as integral to the national
discussion on education.
Read the report ...
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Recent Research
Women and Minority
Entrepreneurs Face Lower Survival Rates
Minority and women entrepreneurs continue to
experience lower survival rates than their white (and Asian), male
counterparts, according to a recent U.S. Census Bureau report by
Ron Jarmin and C.J. Krizan of the Bureau's
Center for Economic Studies. Jarmin and Krizan link several
databases on business activity in 2005 in order to track how
race, gender, education and experience of the entrepreneur relate
to survival rates, profits, size, employment growth and exports.
The results indicate that firms owned by African-American, female
and other minority entrepreneurs are more likely to fail, but also
suggest that minority-owners use business failures to gain
experience for future endeavors.
Minority- and women-owned firms typically face
higher business death rates than white- or male-owned businesses.
The notable exception is firms owned by entrepreneurs of Asian
decent, which have similar survival rates to white-owned
businesses. The same pattern holds true for growth rates across
race and sex demographics.
Higher educational attainment improves the
survival prospects for an owner's firm.
Businesses owned by people under 25 years old or over 55 years old
are more likely to fail and have lower growth rates. Urban firms
have lower death rates, and both urban and rural firms have higher
growth rates than suburban firms overall. Franchise businesses have
a higher likelihood of death, but, if they survive, tend to grow
faster than other businesses.
A few patterns emerge after conditioning the
data on firm survival that tweak the conventional knowledge on
female and minority entrepreneurship. Among surviving firms, there
appears to be no difference in the growth rates of white- and
male-owned firms and other businesses. The higher death rate of
women- and minority-owned firms are attributed to differences in
prior work experience, family business backgrounds and the
availability of capital. The firms that survive, however, grow at a relatively healthy rate.
Female and minority businesses are more likely
to have started out without any employees except for the
entrepreneur, according to the study. Like female and minority
businesses, firms with "non-employer"
backgrounds have lower survival rates, but have typical growth
rates after conditioning on survival. The authors cite
studies that have found that female and minority entrepreneurs are
more likely to start non-employer businesses in order to start
small. Since female and minority entrepreneurs often lack access to
the sources of capital and connections that are available to white,
male entrepreneurs, they tend to launch smaller firms in order to
gain experience and work within the resources available to them.
While these businesses are more likely to fail, entrepreneurs can
gain experience from that failure that would have been otherwise
unavailable.
Read "Past Experience and
Future Success: New Evidence on Owner Characteristics and Firm
Performance" at: http://ideas.repec.org/p/cen/wpaper/10-24.html..
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Staff Picks
Subra Suresh Confirmed as National Science Foundation Director
The Senate confirmed Subra Suresh as the new director of the National Science Foundation on Tuesday. The American Institute of Physics has details on his background.
Read more ...
NIST MEP Awards $9.1 Million to Enhance U.S. Manufacturers' Global Competitiveness
The NIST Manufacturing Extension Partnership cooperative agreements will support 22 projects designed to enhance the productivity, technological performance and global competitiveness of U.S. manufacturers.
Read more ...
Ottawa Launches Innovation Commercialization Program
The $40 million Canadian Innovation Commercialization Program includes funding for product testing.
Read more ...
China Announces Innovation Society Plan
China will seek to recruit more than 10,000 foreign students in an effort to import the next generation of innovators.
Read more ...
Green Innovation Index Finds Bright Spot in CA Economy
The 2010 California Green Innovation Index finds that, despite the overall economy, the state is experiencing a significant expansion in green manufacturing employment.
Read more ...
SBA Announces Fed. Initiative To Aid Women-Owned Businesses
The Women's Contracting Rule will give preference to woman-owned businesses in 83 industries in which women are underrepresented.
Read more ...
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