SSTI Digest

A new commentary from a senior policy analyst at the Federal Reserve Bank of Cleveland examines the extent to which disparities exist between Black and whites in labor market outcomes such as levels of labor force participation, unemployment rates, and earnings. Economic inclusion trends have been studied at the national level, but this commentary takes a look at how those disparities vary within and across states with a specific look at the Fourth Federal Reserve District states of Kentucky, Ohio and Pennsylvania. Relying on monthly data from the Current Population Survey (CPS), the Fed analyst, Kyle Fee, examined differences in state-level outcomes for Blacks and whites in the employment rate, the labor force participation rate, the unemployment rate, and real median hourly earnings. He found that states generally mirror national trends, but the degree of economic inclusion varies over time and across states. For instance, the national black and white (BW) gap in employment shows cyclical behavior where the gap increases during a recession, peaks once the recession ends, and slowly declines during expansions. In 2007 before the Great Recession, the national BW…

As noted in our separate overview, the 25-page American Jobs Plan provides goals, highlights and proposals, but also raises questions about how proposals would be implemented and even exactly how much money would be spent. Those details presumably will come in the near future when legislative language is submitted. The document and much of the news covering it is organized around six goals. For our readership, we have taken a slightly different approach. Major themes and key aspects of the proposal are below. All quoted text is from the AJP summary released by the White House on the morning of March 31, 2021. Thematic issues addressed in the plan Global competition, preparing for the increasing impacts of climate change, reversing human contributions to the climate crisis, and addressing disparities in wellbeing and opportunity experienced by Americans are the overlying thematic issues the plan addresses. The plan is designed so all future federal investments toward one of the thematic issues would not make another issue worse.  For example, in the transportation section, the plan includes this commitment: “Every dollar spent on rebuilding our infrastructure…

Much of the public policy and governmental spending focus to date regarding COVID recovery has been just that: recovery. The infrastructure proposal, the America Jobs Plan (AJP), President Biden unveiled this week represents his proposal to start moving forward.  In remarks about the proposal, he described it as “not a plan that tinkers around the edges,” a “once-in-a-generation investment” that will lead to “transformational progress.” The breadth of the plan and its heavy focus on science, technology, innovation and manufacturing should excite SSTI Weekly Digest readers. Issues that we’ve covered for more than two decades (e.g., digital divide, increasing our R&D investment, regional disparities) are addressed in a scale we have never seen a president propose before. There are a lot of details still to be sorted out. The initial public document outlining the AJP is similar to the executive summary of the annual federal budget: plenty of big numbers wrapped around carefully selected words but short on details or even many breakdowns below the top line figures.     The AJP might not pass in any shape resembling the proposal…

While President Biden’s infrastructure proposal with heavy investments in science, technology and innovation garnered most of the press attention in the last week, a number of other developments occurred in or impacting federal policy, including: In a bipartisan announcement, the combined House Science Committee leadership introduced the NSF for the Future Act to reauthorize the foundation, increase its funding significantly, and creates a new directorate for science and engineering solutions, among other things. Rep Frank Lucas, ranking member of the House Science Space, and Technology Committee, introduced legislation co-sponsored by his Republican colleagues on the committee to double federal basic research spending over a decade. OECD estimates in 2019, the U.S. finally topped the 3.0 percent milestone for R&D’s share of total GDP. AAAS reports, although the 3.07 percent figure is a record high for the U.S., it still places us no better than eighth or ninth in the world. The federal share of that 3.07 percent is only around 0.7 percent. President Biden last week said he’d like to see the federal share of science funding closer to 2.0 percent, a level last seen…

For those looking for examples of the impact state investment, university involvement and tech-based economic development can have in rural parts of the country, one can examine news from Appalachian Ohio that Stirling Ultracold reached a definitive merger agreement on March 22 to be acquired for a reported $258 million by publicly-traded BioLife Solutions. The original lead investor in Stirling Ultracold is TechGROWTH Ohio, one of Ohio Third Frontier’s regional entrepreneurial service providers. BioLife intends to keep the Stirling Ultracold brand intact and maintain existing staff in Athens, Ohio. The 160 employees in the rural Southeast Ohio county is the equivalent on a per capita basis to more than 11,000 employees in Cook County, Illinois (the county Chicago is located in).     TechGROWTH provided multiple rounds of follow-on funding during the company’s startup and growth stages. Lynn Gellerman, executive director of TechGROWTH Ohio and Ohio University’s Voinovich School of Leadership and Public Affairs’ associate dean of innovation partnerships, said the size of the acquisition makes it the largest venture-backed exit in southeast Ohio…

The stability of the economic innovation wavelength hinges on the distribution of forward generated project capital while being able to simultaneously build a lasting commitment towards upwards stratigeric commercialization prospects within the target sector. This has been reaffirmed by researchers at the Institute for Innovative Solution Developments who, through the use of a tri-helix macramedian progression model, found that the defining variables of entrepreneurial achievability boil down to providable funding cohesion and a consistent commitment towards developing staff and researcher technologicity. Using a reverse projectization equation, dummy variables were generated to balance for the inherent sectorilized differences found within the annualized project databases alongside the availability for prerelease fund generation, all while taking into account recently revised rules surrounding private capital distribulation. These findings shed a new light on the overall biologistics of the innovation development growth pattern, and as research continues, may prove useful to state and federal policymakers who wish to help stimulate technologicity investments throughout…

As the most ambitious innovation initiative that Europe has ever undertaken, the European Union (EU) recently launched the European Innovation Council (EIC) with a €10 billion (about $11.7 billion USD) fund that will provide both non-dilutive grants to and direct equity investments in innovative startups within the union. After a successful three-year pilot, the EIC is merging with the current Executive Agency for Small and Medium-sized Enterprises, and has already launched its first official program with a call for proposals worth €1.5 billion (approximately $1.8 billion USD).

The Federal Communications Commission (FCC) estimates that nearly one-fourth of the rural population —14.5 million people — lack access to broadband services. In tribal areas, nearly one-third of the population lacks access. Even in areas where broadband is available, approximately 100 million Americans still do not subscribe to services. The problem, often referred to as the digital divide or broadband gap, has seen renewed policy interest from governors and legislators since the world has turned more to virtual learning and business during the pandemic. One way policymakers have attempted to connect rural America is through public grants or dedicated funds. Just in 2021, proposals at the state level to expand broadband have included: Illinois state matching grants - $50 million in state matching grants will be awarded this year toward making progress on the state’s goal of universal broadband access in 2024. Tennessee capital injection - $200 million outlined in governor’s State-of-the-State address to help state achieve universal access broadband target. Georgia rural broadband grants - $20 million this year and $10 million each subsequent year included in budget as…

Facing current challenges and a changing economy, Oregon is turning to innovation-based economic growth. Their new 10-year Innovation Plan focuses on ensuring a competitive position through four means — traded sector industries that constantly innovate; a robust entrepreneurial ecosystem; financial capital markets that are open to investing in innovative firms and entrepreneurs; and promoting itself as a place to start and grow in innovative company. The state’s first plan was created in 2006, and the new plan, commissioned by Business Oregon and facilitated by TEConomy Partners, notes that while progress has been made, “access to opportunities in innovation-oriented fields has been unequal,” and calls for a focus on engaging all citizens. “We believe that economic justice is a fundamental precursor to achieving an equitable outcome for all segments of our population,” it says. And in order to drive change in the state’s economy, efforts to address broadband accessibility and affordability, a thriving talent base and robust R&D enterprise are needed, it notes. In creating a roadmap to build the plan, actions such as supporting Centers of Innovation…

Over the course of 2020, Americans reported a total of $4.2 billion in losses due to internet fraud and cybercrime, an increase from the $3.5 billion reported in 2019. In addition, the Federal Bureau of Investigation’s Internet Crime Complaint Center experienced a record number of reports surrounding cybercrime and internet fraud: 791,790 total complaints were filed throughout 2020, a 69 percent increase from 2019. The FBI Internet Crime Complaint Center’s recently released Internet Crime Report 2020 also finds that the COVID-19 pandemic has presented new targets for internet criminals as both individuals and businesses reported online financial crimes surrounding the CARES Act stimulus funds, including the Paycheck Protection Program and unemployment insurance fraud. While the FBI Internet Crime Complaint Center details the rise in several methods of cybercrime that can threaten individuals, ransomware has emerged as a persistent threat to state and local governments throughout the country. Ransoming Government, a 2020 report released by the Deloitte Center for Government Insights, finds that governments are particularly susceptible to ransomware attacks due to a…

The R&D performed at colleges and universities is an important driver for the innovation economy — generating new knowledge, spurring invention, training STEM talent, and supporting economic development. This edition of SSTI’s Useful Stats analyzes metropolitan-level data for 2019 from the National Science Foundation on higher education R&D (HERD) expenditures and personnel. Nearly 981,000 individuals in higher education across the U.S. were classified as R&D personnel in 2019. As shown by the green shading in the interactive map below, the metropolitan areas with the greatest total number of HERD personnel in 2019 were Baltimore, Maryland* (44,323); New York-Newark-Jersey City (43,103); Los Angeles-Long Beach-Anaheim, California (35,796); Boston-Cambridge-Newton (35,587); and Philadelphia-Camden-Wilmington (27,147).

Last week not only marked the anniversary of the COVID-19 pandemic, but also the release of updated employment data from the U.S. Bureau of Labor Statistics (BLS). The monthly data shows that the pandemic had a very unusual effect on workers, experienced both as a uniquely-chaotic period of labor force participation, but also as an unprecedented immediate drop in employment. The graphic captures just how chaotic the last year has been. Compared against the trends of the past two decades, it is clear that the COVID-19 recession has, thus far, affected workers very differently than either the brief 2001 recession or the Great Recession. Labor force participation rate measures the portion of the adult, non-institutionalized population that is either working or looking for work. Often, people who leave employment remain tied to the labor force as they begin looking for new work. The pandemic was an unusual cause of separations from work as people did not necessarily want to find new, potentially-unsafe employment — and, in some states, these circumstances reoccurred with new rises in coronavirus cases. The impact of these changes can be seen in the pattern of the monthly…