SSTI Digest

Each month, several Federal Reserve Banks post survey results for manufacturing activity within their districts. The June results for those released to date vary sharply by region. For instance, the production index of manufacturing activity in Texas contracted for the second consecutive month, while the nearby Tenth District bank, located in Kansas City, posted its first positive month-over-month composite since January, 2015.  The Philadelphia survey paints a similar mixed collection of indicators as Kansas City: current activity is up after two months of declines, while the six-month forecast softened. The two regions may be experiencing modest growth in manufacturing, but both surveys indicate new orders, shipments, and employment remained negative. Texas sees the same declines in those three indicators, with labor contracting for the sixth consecutive month. Nevertheless manufacturers remain optimistic about the outlook in the Kansas City, Philadelphia and Texas surveys. Meanwhile the Empire Manufacturing Survey results for June, released by the Second Reserve Bank in New York City, indicates a modest expansion for New York companies as current…

Last week, the U.S. Department of Transportation announced that Columbus, home to SSTI’s 2016 Annual Conference, has won a $40 million grant from the agency, beating out five other cities in the Smart City Challenge. As is often the case in Columbus, partnerships were vital to the city’s success; to complement the federal funds, businesses and other public entities in the region pledged $90 million to support the future transportation initiatives. In addition to the $40 million grant from the USDOT, Columbus is also expected to receive an additional $10 million from Microsoft co-founder Paul Allen’s Vulcan Inc. to help support electric-vehicle programs. Both of these amounts pale in comparison, however, to the $90 million raised in the community to support the endeavor, led by energy company AEP ($22.8 million), Columbus Partnership members ($22.5 million), Ohio State University ($15 million), and the city of Columbus ($10.5 million). Several other companies, through their partnerships with the USDOT, will also commit to Columbus as part of its Smart City designation, including Amazon Web Services, Mobileye, Autodesk, and NXP. The city is also…

The Senate Commerce Committee approved Wednesday the American Innovation and Competitiveness Act (AICA), a reauthorization of the America COMPETES Act. SSTI thanks Sen. Jerry Moran (R-KS) for his leadership in successfully offering an amendment to increase the authorization level for the Regional Innovation (RI) program to $30 million, which provides support for local innovation, entrepreneurship and economic growth. SSTI also recognizes Sen. Roy Blunt (R-MO) and Sen. Amy Klobuchar (D-MN) for their support of the organization’s priorities. The bipartisan bill includes several provisions that support federal investment in research, innovation and commercialization, but SSTI believes that further changes must be made for the bill to fulfill the original mission of the America COMPETES Act. The AICA does not include SSTI’s priority of a commercialization grant program based on the language of S. 181, the Startup Act. As the AICA moves forward, SSTI encourages Congress to incorporate this proposal, and to bring the RI program authorization even closer to its original level of $100 million, as established in the America COMPETES Act of 2010.

The University System of Maryland (USM) recently announced a $25 million fund to invest in USM-affiliated companies or startups created by students, faculty and recent graduates.  Companies already based in USM research parks or university incubators are also eligible for funding. The system, comprised of 12 of the state’s public institutions, would invest $10 million in an early stage investment fund, known as the USM Early Stage Investment Fund (ESIF), over four years, with the remaining $15 million to come from outside investors, the state of Maryland, friends of USM and other venture capital groups.  The USM Board of Regents approved the ESIF on June 10 and has already identified 17 startups at the University of Maryland-Baltimore, University of Maryland-Baltimore County, the University of Maryland Center for Environmental Science, and the University of Maryland-College Park as potential recipients for the first investment round.  USM will make individual investments of between $50,000 and $500,000 in startups in exchange for an equity stake in the companies. Eventually, USM will sell the equity stake back, putting the proceeds back into the ESIF…

In 2012, the President’s Council of Advisors on Science and Technology (PCAST) released Engage to Excel – a five point strategy to increase the STEM pipeline by an additional one million workers. To achieve this goal of one million additional STEM workers, PCAST highlighted the importance of freshman research experiences for STEM students. Several studies - published over the last two years support the claims made by PCAST regarding the success of freshman research experiences. In a study from the University of Texas-Austin, the authors found that a freshman research program improved the retention of students in STEM fields. Other studies find that participation by freshmen in research experiences provides the building blocks necessary for a career in STEM. The benefits also show similarly high rates of retention after participating in a mentored research program. STEM research experiences increase retention of undergraduates in STEM fields by almost 25 percent, according to a scholarly article published in the June edition of CBE-Life Sciences Education. In Early Engagement in Course-Based Research Increases Graduation Rates and Completion of Science,…

Throughout the United States, innovation districts have been proposed with varying degrees of emphasis on inclusivity and opportunity. In January 2016, a public-private partnership representing many of Baltimore’s most influential anchor institutions, community-based organizations, and private companies declared their intent to develop an innovation district in West Baltimore dubbed the “Innovation Village.”  This week, the Innovation Village steering committee announced several initiatives aimed at supporting inclusive economic growth in West Baltimore neighborhoods including free Wi-Fi, entrepreneurial assistance programs, and the development of a food hub. The commitments made to support the Innovation Village are aimed at increasing economic inclusion in an area of the city mired by inequality, as noted in Technically.Baltimore. Among the most notable is the intent to set up free wireless Internet connectivity in the entire district. This would be led by a pilot project seeded with $50,000 from OneBaltimore, a nonprofit organization created by the city of Baltimore in spring 2015 to support ongoing efforts to rebuild communities and…

Because a research base that generates new knowledge is a key pillar of a technology-based economy, an important strategy in technology-based economic development is the expansion of research capacity. While states may go about addressing this in a variety of ways (e.g., R&D tax-credits, university-industry partnerships, recruiting eminent scholars), Florida drew national attention when it took a different approach last decade, allocating more than $450 million to attract nine research institutes through its Innovation Incentive Program (IIP). Recently, one of those attracted institutes, the San Diego-based Sanford-Burnham Prebys Medical Discovery Institute – which received approximately $367 million in state and local incentives to open an Orlando location – announced that it was having discussions with the University of Florida to exit the state and turn the Florida operations over to the university. Writing for Reuters in the early stages of former Florida Gov. Jeb Bush’s 2016 presidential campaign, journalist Jason Szep noted that, despite Bush-the-candidate’s suggestion that the government should not be in the business of picking winners…

When Canadian Prime Minister Justin Trudeau released his administration’s proposed 2016 budget in late March, SSTI covered the significant funds it would allocate for science, research, and technology-based economic development, as well as the country’s plan for a national innovation agenda. To guide this forthcoming agenda, the Canadian government recently announced six priority areas of action, as well as its intent to conduct a series of engagement efforts that collect additional insight from the public. Central to their plan is the launch of a fully interactive website that will provide Canadians with the ability to offer their own views on how Canada can best support innovation and to vote on ideas that others presented.  As a way to help inform their public outreach, the Canadian government released a backgrounder that includes six priority areas of action for the Innovation Agenda, along with guiding questions for which they are asking further input. These areas of action are:  Promoting an entrepreneurial and creative society; What does it take for Canada to be known globally as the best country in attracting and developing diverse,…

This week, the White House is celebrating its third National Week of Making – an important part of its Nation of Makers initiative that seeks to expand opportunities for students and adults to engage with the maker movement. In addition to numerous commitments and announcements made at federal agencies, several other projects rooted in strong partnerships were announced. These include the distribution of a million microscopes to children from around the world by Foldscope Instruments, the investment in 100 new makerspaces by Google and Chevron, and the release of the Maker City Playbook. As in previous years, the Obama administration produced a White House Fact Sheet in honor of the National Week of Making to highlight the new steps announced by federal agencies and other partnerships that seek to leverage the maker movement. Several of these commitments are particularly relevant to technology-based economic development organizations. For example, the National Institute of Standards and Technology (NIST) is committing up to $2 million in existing funds for Manufacturing Extension Partnership (MEP) Centers to develop consulting and technical-services programs that…

Much of the media coverage on the latest NASBO Fiscal Survey of States, suggests the Great Recession is finally behind the states as aggregate general revenue funds finally surpassed fiscal 2008 levels. But unlike the federal government, there are 50 individual state budgets and they tell very different stories, influenced by the economics, demographics, tax structures and politics of the particular state. For instance, while the aggregated stats sound rosy, a majority of states, 29, still reported 2016 general fund expenditures below the 2008 levels before the Great Recession really hit state revenues.  SSTI’s monitoring of state fiscal conditions reveals recent monthly revenues for a growing number of states – in months after the NASBO spring survey was conducted – are not meeting intake expectations. This might suggest FY 2017 revenue and spending forecasts may slow even more than NASBO’s reported 2.9 percent and 2.5 percent, respectively. The unevenness of state fiscal conditions is evident in the NASBO report with the midyear adjustments states made, up or down, to current year budgets. NASBO found 15 states increased their spending…

President Obama announced  the creation of the new Smart Manufacturing Innovation Institute (Smart MII) – a $140 million public-private partnership to develop smart sensors for use in advanced manufacturing. Headquartered in Los Angeles, CA, the Smart Manufacturing Leadership Coalition (SMLC) – a consortium of nearly 200 partners from academia and industry as well as nonprofit organizations – will lead the Smart MII. The Smart MII is the ninth MII awarded by the Obama administration. The president also announced five additional MII competitions, which are intended to invest nearly $800 million in combined federal and non-federal resources to support transformative manufacturing technologies in four areas: Robotics in Manufacturing Environments Manufacturing Innovation; Advanced Tissue Biofabrication Manufacturing Innovation Institute; Modular Chemical Process Intensification (MCPI) Institute; and, Reducing Embodied Energy and Decreasing Emissions (REMADE) in Materials Manufacturing Institute. The fifth manufacturing institute will be an “open topic” institute competition – any topic proposed by industry not already addressed by…

When employees discover potentially significant inventions during their line of work, they can decide whether to leave their company and form a new startup around the idea, or to transfer the knowledge to the parent firm and attempt to gain financial compensation through a spinoff.  As seen in the 2016 summary report from Failure Aversion Change in Europe (FACE) Entrepreneurship, the two main fears for entrepreneurs are financial security and losing a stable, professional job. Recent research also suggests that granting employees extended leaves of absence with guaranteed options for returning increases the likelihood of entrepreneurship.  Coupled together, these results prompted SSTI to further review the relationship between corporate-leave policies and entrepreneurship. In Experimenting with Entrepreneurship: The Effect of Job-Protected Leave, a recently released working paper from Dartmouth’s Tuck School of Business, authors Joshua Gottleib, Richard Townsend, and Ting Xu test whether likelihood of entry into entrepreneurship is influenced by granting employees extended leaves of absence with a guaranteed option for returning. The authors examine a…