SSTI Digest

The Federal Communications Commission (FCC) announced last week that it has approved the Rural Digital Opportunity Fund which will provide $20.4 billion over two phases to help expand broadband networks throughout rural communities. Phase one will provide $16 billion for use in communities that are currently unserved by broadband services with minimal download speeds of 25 megabits per second (Mbps) and 3 Mbps upload speeds. The remaining funds will be used in phase two which will target underserved communities after a more extensive and focused analysis has been completed to better define “underserved” areas. Although the FCC has been widely criticized for the inaccuracy of its broadband coverage maps, the organization decided to move forward with its phased plan. The FCC justified its decision by explaining that although its definition of a “served area” has been criticized as misrepresenting areas that are actually “partially served,” there has yet to be any analysis showing that any areas it classifies as “unserved” — the areas targeted in its first phase — are actually receiving adequate broadband services. The FCC argues that funds should not be withheld from the…

A recent survey of millennials by professional services firm Ernst and Young (EY) provides insights into how the generation is aging — and bucking some long-held assumptions. Evaluating the generation’s trends in living arrangements, lifestyle and career preferences, financial health, and social perspectives, EY found that some of the assumptions about millennials are not holding. For instance, the survey found that millennials — loosely defined as those born between 1980 and 2000 — are looking to put down roots and buy houses — cost effectively and not only in urban centers — although they still lag behind their predecessors in terms of home ownership rates at each age. Millennials are also less risk averse than may have been originally thought. While they still value job flexibility, the prevailing theory that they prefer the startup culture of work has been shown to be false. Millennials now appear to prefer the stability and growth opportunities provided by larger and more established organizations. Job flexibility and work-life balance are still the top concerns, but many millennials also put more stock into the value of pay equity, with 47 percent listing it…

What holds people back from starting a business? How does lifting financial constraints help promote entrepreneurship? A recent article by Vyacheslav Mikhed of the Federal Reserve Bank of Philadelphia Consumer Finance Institute,  Sahil Raina of the University of Alberta, and Barry Scholnick of University of Alberta and Federal Reserve Bank of Philadelphia Consumer Finance Institute, explores these questions, and how lifting these economic constraints affected entrepreneurial and self-employed business ventures in Canada from 2002-2016. By comparing lottery winnings to new business endeavors, they found that entrepreneurs face greater financial constraint when starting a business than those who are self-employed. Perhaps the biggest takeaway is that entrepreneurship faces relatively equal challenges during economic booms and busts. While this seems counterintuitive, there may be an excess of ideas during booms and, therefore, a lack of adequate capital. In the bust cycle, while there is less capital overall, demand for that capital may shrink in these times and businesses may have better chances securing investment against a smaller field. The authors suggest that…

Building on SSTI’s recent analysis of county-level GDP by industry, this edition moves beyond a single year and examines the changes in real — adjusted for inflation — county GDP and the changes in industry-specific contributions to county GDP for the 10-year period from 2009 to 2018. As shown in the interactive map below, the total 10-year growth rate for counties averaged approximately 21 percent. All 10 of the counties that experienced the greatest percentage increases in total GDP between 2009 and 2018 are in Texas. The increases for these top 10 counties ranged from 709 percent to more than 3000 percent. The growth in most of these counties was driven by dramatic increases in the mining industry and related activities such as transportation and utilities. Expanding this analysis to include the top 100 counties out of the total 3116, Texas is represented 31 times, followed by Nebraska (10 times), and North Dakota (seven times), Ohio (seven times), and Oklahoma (seven times) tied for third. The GDP increases for these 100 counties ranged from 90.6 percent to more than 3000 percent. Other notable areas of increase include the Ohio-Pennsylvania-West Virginia…

The Federal and State Technology Partnership (FAST) is intended to increase innovation-based small business awareness and participation in the SBIR and STTR programs in places and populations that are underrepresented in the programs’ award portfolios.  Through FAST, the Small Business Administration (SBA) makes small, matching one-year awards to state programs on a competitive basis. The most recent class of 24 FAST winners was announced in August 2019.  First funded in 2001, FAST has become the cornerstone for funding many states’ initiatives intended to help SBIR applicants become involved in the federal SBIR/STTR programs. But does the program work? A new, independent study prepared by Summit Consulting and funded by the SBA, suggests favorable findings along several performance indicators for FAST awards made during the FY 2015-2017 period (old enough that SBIR outcomes could be assessed but young enough that most of the companies are still trackable). Clients of FAST-awarded state programs won 285 awards totaling $79,712,439 (Phase I and Phase II for both SBIR and STTR) during the three years, FY 2015-2017. That is still less than 1 percent of…

The economy, workforce and climate change continue to surface in governors' state of the state addresses. While today’s strong economy allows most governors to reflect on how the states have grown, preparing for the next downturn continues to be a point of concern. As SSTI continues to review the addresses for news of new innovation-related initiatives, we find Delaware proposing increased investment in its economic infrastructure, while renewable energy standards are at play in states like Delaware, Hawaii, and Maine. And Wisconsin’s governor pledged to create a commission to focus on rural prosperity and another to consider redistricting across the state. Those and more innovation initiatives are excerpted from the governors’ remarks below. Delaware Gov. John Carney outlined his priorities for strengthening Delaware’s economy as he starts his fourth year as governor: “I’ve asked our Chief Information Officer, James Collins, to lead a new effort to connect state government with Delawareans through technology. This will be a game changer for our state. Together, we’ve also invested over $30 million in the Higher Education Economic Development Fund. We…

More states are employing different efforts to boost their workforce and to seek the best solutions to workforce dilemmas. The National Governors Association (NGA) recognized that governors are exploring ways to guide development and expansion of youth apprenticeship programs and has issued a white paper that explores three strategies governors can use to expand on such programs. In a separate effort, the National Skills Coalition has selected coalitions from 10 new states to join SkillSPAN, a national network of state coalitions expanding access to skills training through state policy changes that support all workers. The NGA white paper notes that today’s high school graduates with no postsecondary or industry-recognized credentials can face a bleak future. Additionally, when states have a less-skilled workforce, it is more difficult to attract business investment and requires greater funding for social services for the state’s unemployed and underemployed youth.  Youth apprenticeships combat that and connect more young people to career paths at an earlier age and help fill business workforce needs, authors Kristin Baddour and Kimberly Hauge assert. …

A recent report from the Organization for Economic Cooperation and Development (OECD) focuses on increasing participation in entrepreneurship from underrepresented and disadvantaged groups such as women, immigrants, youth, seniors, the unemployed, and people with disabilities. The Missing Entrepreneurs 2019 report notes that addressing market and institutional failures that prevent equal opportunities in entrepreneurship “is an important requirement for achieving a new type of growth that is more inclusive, sustainable and people-centered.” The report recommends policies to increase opportunities for these groups, such as including entrepreneurship models in science-based programs in higher education to increase awareness about the potential of entrepreneurship for students, especially young women. Underrepresented and disadvantaged groups face barriers in the entrepreneurship sector including access to finance, lack of business networks, entrepreneurial culture and the regulatory environment. Key recommendations from the report, the fifth edition in the series of Missing Entrepreneurs reports, include collecting more gender and age disaggregated data on the digital…

On Monday, Maine Gov. Janet Mills and Mayor Kate Snyder gathered on Portland’s waterfront for the unveiling of a $100 million research institute designed to drive innovation, talent and economic growth in Portland, the region and the state of Maine. Silicon Valley investor, entrepreneur and Maine native, David Roux, has donated the large sum to Northeastern University to create Roux Institute, a research center that will award certificates, master’s degrees, and Ph.D.’s in artificial intelligence (AI) and machine learning. The institute will train data scientists and computer programmers and ultimately, it is hoped, create an environment and economy conducive to innovation and technology, and reducing the current inequality Portland faces in those areas. Roux conducted a search for two years to find a research university to partner with on the new institute. The Boston Globe reported that 10 founding employer partners have agreed to send their employees to the institute and offer students employment training as part of their education. The institute, which is still working on getting regulatory approval, is set to open its temporary headquarters in May, but Roux says it…

Please mark your calendars for Oct. 5-7, 2020, as the new date for SSTI’s Annual Conference. Because our rooms were overbooked for the previous dates, we have moved the conference up a week. The Little Rock Marriott has dropped the room rate to $129 to accommodate any inconvenience this may have caused. Click here for conference registration, and you can book your room here. Stay tuned for more information on conference developments at ssticonference.org!

The National Academies of Science, Engineering, and Medicine (NASEM) has set out to address the core risks that currently threaten the United States' bioeconomy with the release of their report Safeguarding the Bioeconomy. While the U.S. is currently leading the bio economic playing field, NASEM warns that the nation must be aware of the challenges from decentralized leadership, inadequate talent development, cybersecurity vulnerabilities, stagnant investment in fundamental research, and international competition if it hopes to continue its success. The report recommends steps the U.S. could take to mitigate these risks and sustain a strong bioeconomy, including forming a coordinating body within the Executive Office of the President to ensure coordination across the science, economic, regulatory, and security agencies. NASEM defines the bioeconomy as the "economic activity that is driven by research and innovation in the life sciences and biotechnology, and that is enabled by technological advances in engineering and in computing and information sciences." As such, a committee that authored the report valued the bioeconomy at more than 5 percent of GDP, or more than $…

Governors’ focus on initiatives particular to their state in this latest round of state of the state addresses. As SSTI continues to review the speeches for new innovation proposals, we found states continuing to focus on education with more attention on teacher salaries and efforts extending all the way down to pre-K with a recognition that the future workforce is influenced by many factors. Florida is also hoping to grow its aerospace and manufacturing sectors, while Kentucky’s new governor is looking to ag tech and sports betting as new revenue sources. Occupational licensing reform is also a recurring theme in many states this year, along with clean energy and renewable fuels. Florida Gov. Ron DeSantis attributed the in-migration of residents from other states to the lack of a state income tax in Florida, and said he will continue that policy with the expectation that further growth will ensue. “We have the good fortune to be attracting investment and business activity and have good potential for further growth in aerospace, financial services, health care and manufacturing.” “We have a good [occupational licensing] reform bill pending before…