SSTI Digest

Although changes in gross domestic product (GDP) give us an idea of how economies are changing, this measure fails to tell the full story. This edition of Useful Stats examines county-level GDP-per-capita, the measure of economic output for each resident in an area. What we see is strongly skewed data with high 2018 GDP-per-capita levels and high 10-year growth rates concentrated primarily in low population-high output counties. We also see that rural populations have declined over the period while metropolitan areas have grown, yet the median GDP-per-capita growth rates between the groups are essentially the same.

The U.S. Economic Development Administration has announced the FY 2020 notice of funding availability for the Regional Innovation Strategies program. There are multiple changes to the program this year, including that EDA is now referring to the program as “Build to Scale.” A total of $35 million is available this year due to support from Congress with advocacy from SSTI’s Innovation Advocacy Council. The Trump Administration budget proposal for FY2020, and again for FY2021, proposed eliminating the program. Initial applications are due March 24. The following are significant changes to the program this year: Branding – EDA has renamed all aspects of the program. RIS is now "Build to Scale." The i6 Challenge is now the "Venture Challenge." Seed Fund Support is now "Capital Challenge."  Application process – EDA is instituting a two-step application process. All applicants now begin with a comparatively brief "Concept Proposal" (the format is similar to SBA's Growth Accelerator Fund Competition). This preliminary application is due March 24. After receiving feedback from EDA, organizations will have until June 14 to submit the full proposal. "…

Just days after the White House proposed eliminating EDA’s and SBA’s innovation programs, SSTI’s Innovation Advocacy Council held more than two dozen meetings on Capitol Hill. Teams of universities, venture development organizations and statewide entities talked with congressional staff about the importance of the Regional Innovation Strategies (now “Build to Scale”), the Regional Innovation Clusters, and Federal and State Technology Partnership (FAST) programs. Offices were largely interested in, and supportive of, the message. While this first Hill Day of the year is over, you can still support funding for these programs by contacting your congressional offices. SSTI is happy to facilitate this for members — contact Jason Rittenberg (rittenberg@ssti.org | 614-901-1690) to get started.

The Trump administration released its FY 2021 budget this week. As with the past three iterations, Congress is unlikely to consider the proposal, which would cut domestic spending by 20 percent over a decade. Nonetheless, a quick review of the White House’s budget reveals the administration’s priorities: EDA, ARPA-E and MEP would be eliminated; total R&D would be cut by nine percent while dramatically increasing funding for AI and quantum information science; loan programs at USDA and SBA would see funding cuts made up through increasing user fees; and, technical education would see a boost through both investments in high school programs and apprenticeship initiatives. Congress has already agreed to topline funding that allows for a slight increase in spending this year, and so the final FY 2021 budget seems likely to be more similar to the current-year budget than this proposal. SSTI’s Innovation Advocacy Council is on the Hill this week to talk with members of Congress about the importance of supporting locally-driven innovation initiatives. Over the next few months, SSTI members will be involved in sharing their impacts, sending letters, and otherwise…

With nearly 40 of the state governors now having given a state of the state or budget address, innovation themes continue to echo in their reviews of past accomplishments and plans for the coming year. There is a priority on education (both on teacher salaries and preK initiatives as seen in Alabama, in addition to higher education and a focus on its affordability with Connecticut proposing free tuition for community college for recent high school grads and Pennsylvania putting additional dollars into scholarships), energy, workforce, broadband and a special emphasis on distressed communities in Connecticut and Tennessee. While SSTI continues to review the addresses and features excerpts as they relate to innovation intiatives in this series, remaining speeches will be scattered over the coming weeks. Alabama Gov. Kay Ivey gave her third state of the state address earlier this month, and presented an agenda that called for changes in the state’s educational system, and growth in broadband and workforce development. Noting that “a world-class workforce begins with a world-class education system,” the governor called for more money to help build a “solid…

During 2018 and 2019, the American Institute of Physics (AIP) National Task Force to Elevate African American Representation in Undergraduate Physics & Astronomy (TEAM-UP), examined the persistent underrepresentation of African Americans in physics and astronomy in the U.S. as measured by bachelor’s degrees in these fields. The 2020 report spotlights its findings that African American students have the same drive, motivation, intellect, and capability to obtain physics and astronomy degrees as students of other races and ethnicities; however, they are choosing to pursue majors perceived as being more supportive and rewarding. The report uncovers two main causes for underrepresentation of African Americans in physics and astronomy: the lack of a supportive environment for these students in many departments and the enormous financial challenges facing the students and programs. The task force hopes to double the number of physics and astronomy bachelor’s degrees (from the 2017 values of 238 and 12, respectively) awarded annually to African Americans by 2030. TEAM-UP identified five factors as essential to solving the issue: belonging, physics identity,…

In 2015, state and local business incentives across the nation combined for a total annual cost of roughly $45 billion, according to Timothy Bartik's 2017 report for the Upjohn Institute for Employee Research. New research suggests states and regions trying to attract business through the use of firm-specific tax incentives may want to try another tactic. The National Bureau of Economic Research (NBER) recently released a working paper analyzing the impacts of business tax incentives, finding little evidence of long-term benefit for the local economies. Evaluating State and Local Business Tax Incentives examines three major state and local business tax instruments used to attract potential industrial development: lowering corporate tax rates, narrowing the corporate base, and providing firm-specific tax incentives. The paper’s authors, Cailin R. Slattery of Columbia University and Owen M. Zidar of Princeton University, found broad use of incentives, but questionable impact. "State and local governments are devoting substantial resources towards attracting firms and corporate capital," the authors say, but go on to conclude that there does not seem to be "strong evidence…

Last week, the Carnegie Foundation for the Advancement of Teaching designated 119 U.S. colleges and universities as Carnegie Community Engagement Classification recipients. The universities undergo a self-study and review process that considers their relationship within their larger communities and includes areas such as institutional commitment, student impact and outreach and partnerships. Among those designated or re-designated this year, nine are SSTI members.  To be assessed for this classification, institutions must provide evidence of community engagement through a framework broken into three parts: foundational indicators (which is divided into two sections – institutional commitment and institutional identity and culture), circular engagement, and outreach and partnerships. Among the three facets, some of the key aspects focused on are community engagement as a leadership priority, infrastructure, professional development, community voice, breadth of courses offered, depth of the curriculum, and programs and institutional resources provided for the community. Of the 119 institutions classified, 44 are receiving the designation for the first time,…

Uncommon innovation is more likely to be found in high density areas, according to recent research. An article by Enrico Berkes of The Ohio State University and Ruben Gaetani of the University of Toronto, found that high-density areas boast more unusual combinations of prior knowledge, often across technologically distant fields. Their results indicate that geography affects innovation, as high-density areas produce more diverse, original research (i.e. unconventionality) while low-density areas are more likely to produce research within specific clusters.

While the longest economic expansion in modern times in the U.S. continues and fears of a nationwide recession have subsided, there are signs that growth is slowing, and some states may be at risk for a recession. According to projections reported last month from the Federal Reserve Bank of Philadelphia, several states’ economies are forecasted to slide into varying degrees of contraction within the next six months — the most since the financial crisis over a decade ago. Based on the analysis, nine states: Connecticut, Delaware, Kentucky, Montana, New Jersey, Oklahoma, Pennsylvania, Vermont, and West Virginia are all facing projected economic contractions. West Virginia’s economy is expected to shrink the most, and is the state at most risk for a recession while the projected decline in Pennsylvania’s economy is anticipated to be the state’s most severe since May 2009, the tail end of the Great Recession. Delaware, Montana, and Oklahoma are identified to also see shrinking economies over the same period, which was previously projected in an analysis the Federal Reserve reported earlier in December.   In addition, the Federal Reserve also expanded its…

Education, infrastructure and budgets are all on the minds of the governors in this latest review of state of the state addresses. With more than half the governors having completed their outlooks by the end of January, this week we review the speeches through the end of month and find repeated attention to education, energy and budgeting issues, with a statewide lottery being introduced in Alaska, new energy legislation in Illinois, and South Carolina also proposed a funding increase for state universities that do not raise in-state tuition rates. This is the fifth installment of our Tech Talkin’ Govs series, where we comb through the addresses and bring you news of innovation initiatives in excerpts of the governors’ words. Alaska Gov. Mike Dunleavy focused on addressing the state’s budget problems: “While we contemplate the role of the Alaska people in solving our fiscal issues, any and all ideas should be explored. To that end, I’ll soon be introducing legislation to create a statewide lottery. Forty-five states have lotteries in place, and its past time for Alaskans and visitors to have the option to individually contribute to fixing Alaska’s fiscal…

The old adage, “we become/are what we measure” can push behavior of individuals and organizations into unanticipated negative space when the selected key performance indicators take on too much importance — sometimes amazingly negative space that becomes common practice and potentially damaging for the entire industry.  Counting life science startups created through the licensing work of technology transfer offices (TTOs) at the nation’s research universities appears to be the latest example of KPI (key performance indicator) pursuit potentially going bad, based on a recent Nature Biotechnology article. “The biotech living and the walking dead,” written by three Utah-based academicians, Paul C Godfrey, Gove N. Allen and David Benson, describes their research, which found over one-fourth of the 498 life-science university-licensed start-ups created since 1969 by the 50 top patenting universities in the U.S. existed merely on paper. During a forensic research project lasting eight years, the trio was unable to find any evidence that 25.1 percent of the startup firms studied ever advanced beyond the original technology transfer documents. The article includes an…