SSTI Digest

Still no sign of improvement as the U.S. enters the third quarter of its initial public offering (IPO) drought.  Just one venture-backed company made an IPO exit in the third quarter of 2008, according to a release from Thomson Reuters and the National Venture Capital Association (NVCA). Mergers and acquisitions (M&As) also were down 43 percent from the same quarter last year. NVCA explains that this slowdown is attributable to both the crisis in the financial markets and to a longer-term reduction in the number of exits. If this trend continues, they warn that capital could become scarce for companies seeking first time investments.

For several years governors across the country have announced life science and biotech initiatives that are as broad as they are large. The devil is in the details, and in most cases related to bio-based economic development, so are the opportunities. Participants in SSTI's 12th annual conference last week were reminded targeted investments in specialized areas related to merging existing life science and other technological strengths in a region are likely to have the greatest economic impact.

Over the past few weeks, two new initiatives were announced - one in Northeast Ohio and one in Wisconsin - highlighting more focused approaches to building research and commercialization capabilities within multiple industries through advances in the life sciences.

The National Science Foundation (NSF) announced earlier this month the establishment of five new university-based centers developing interdisciplinary research and education programs in partnership with industry in the areas of biorenewable chemicals, green energy systems, communications networks, medical implants and smart lighting.

Each of the Engineering Research Centers (ERC) will receive $18.5 million over five years to focus on technological breakthroughs that lead to new products and services, according to NSF. Additional institutional support has also been secured through several of the partnering universities. The centers can apply for a renewal through NSF that extends another five years and are expected to be self supporting after 10 years.

Complete descriptions of these opportunities and others are available at http://www.ssti.org/posting.htm.

Complete descriptions of these opportunities and others are available at http://www.ssti.org/posting.htm.

SSTI has an effective new learning tool for TBED policymakers and practitioners seeking guidance in approaches to building and sustaining tech-based economies. Through exclusive interviews with Excellence in TBED Award recipients, find out first-hand how these award winning initiatives successfully responded to a critical need by applying innovative approaches to generate substantial economic gains for their region.

Georgia Research Alliance Eminent Scholars®

2007 Winner for the Expanding the Research Infrastructure category

Only 12 days remain for you to register before Encouraging Regional Innovation kicks off on October 14 in Cleveland with four pre-conference sessions. With the economy seemingly changing every hour, there's never been a more important time to join your colleagues at the nation's premier conference on tech-based economic development. This year's conference, we think, has a great mix of sessions to help you plan for what the future may hold: thought-provoking policy sessions with an underlying theme of "where do we go from here?," best practice sessions to give you new ideas, and sessions to give you tools to operate your programs more effectively.

More than 330 people have already registered for the conference. Join them by registering on-line at: https://www.ssti.org/Conf08/registration.htm

Anticipated declines in property tax, local sales tax and local income taxes combined with increased expenditures for energy and fuel, infrastructure, and employee-related costs have city finance officers anticipating worsening fiscal conditions over the next two years.

Released this month by the National League of Cities (NLC), the City Fiscal Conditions in 2008 survey finds that in 2008, nearly two in three city finance officers reported that their cities are less able to meet fiscal needs compared to last year, particularly those cities that rely heavily upon property taxes. Moreover, nearly 80 percent of fiscal officers forecast even more troubling times ahead for 2009.

Technology-focused incubators are an important component to fostering entrepreneurial development in a region by nurturing businesses in the earliest stages of development and helping them grow into larger companies that employ high-wage workers and bring new technologies to the market. The following select announcements provide an overview of new incubators from across the nation, illustrating the vital role of entrepreneurial development in growing high-tech regional economies.

The demand for highly qualified talent in Massachusetts' bioscience industry will add more than 10,000 life sciences workers to the state's workforce by 2014, according to a recent report prepared by the University of Massachusetts Donahue Institute. As described in Growing Talent: Meeting the Evolving Needs of the Massachusetts Life Sciences Industry, 81 percent of these new life sciences jobs are expected to require at least a four-year degree. In preparation for this need, the report identifies the key challenges for increasing the quality and number of potential employees in the state, as well as policy recommendations for future growth.

Foreign-born and ethnic workers continue to rapidly grow in their importance to the U.S. innovation economy, according to two recent studies that address this issue by examining the links between these groups and patenting activity.

In How Much Does Immigration Boost Innovation?, Jennifer Hunt uses state panel data from 1950 to 2000 to measure the extent of immigration's impact on U.S. patenting, state innovation economies and the science and technology workforce. Foreign-born residents account for just over ten percent of the working population, but represent about 25 percent of the science and engineering workforce. The 2003 Survey of College Graduates found that immigrants patent at double the rate of native U.S. residents. That study found that the difference was attributable to disproportionate educational attainment in science and engineering.

According to figures released last week by the Bureau of Economic Analysis (BEA), 85 percent of the nation's 363 metro areas experienced growth in real GDP from 2005 to 2006. For the U.S. metro areas as a whole, the aggregate GDP in current dollars was $11.79 trillion in 2006 - about 90 percent of the U.S. GDP.

Trends in GDP growth can be more informative than one-year changes that might be caused by sudden changes in a local economy (e.g., Hurricane Katrina). SSTI has prepared a table displaying changes in metro area GDP estimates for the five-year period 2002 to 2006. To facilitate comparison across metro areas, the data has been presented in chained 2001 dollars.

The GDP in 23 metro areas decreased over the five years, 2002 to 2006, some like New Orleans and Gulfport-Biloxi for reasons related to the natural disaster. The decline in other metro areas may be more systemic as the local economies continue to restructure away from declining industrial sectors.