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In a report released last week, a Toronto group says that creative industries may soon overtake ICT and business services as the fastest growing sector in the region's economy. In order to preserve this momentum and ensure that other industries benefit from the presence of a strong creative sector, the authors recommend enlisting regional leaders to create programs that support creative people, creative enterprises, affordable spaces for creative work, and a shared community vision.

"More than one-third of the nation's loss of manufacturing jobs between 2000-2005 occurred in seven Great Lakes states: Illinois, Indiana, Michigan, New York, Ohio, Pennsylvania, and Wisconsin," write Howard Wial and Alec Friedhoff in a new paper from the Metropolitan Policy Program of the Brookings Institution.

Also released this week, and related to the negative change of U.S. manufacturing employment, is a new working paper by members of the National Bureau of Economic Research. Outsourcing Jobs? Multinationals and US Employment, by Ann Harrison and Margaret McMillan, examines the labor market decisions of U.S. multinationals at home and abroad for the years 1977 to 1999. Using firm level data collected by the U.S. Bureau of Economic Analysis, the authors econometric model reveals changes in the employment and operations of U.S.

Based on the two versions of the FY 2007 budget working their ways respectively through the House and Senate, the National Science Foundation (NSF) appears to be positioned to receive its first significant increase in funding in many years. Both chambers' versions of the NSF appropriations provide increases above the FY06 appropriations in excess of 7 percent, with the full House approving an increase of 7.9 percent in June.

Last week, North Carolina Gov. Mike Easley signed the budget agreement passed by the state's General Assembly for fiscal years 2006-07. The budget contains many adjustments favoring K-12 and higher education and several allocations for technology-based growth initiatives.

It caught the attention of quite a few people when it was first proposed in early 2001, but Maine's investment in 2002 to provide every seventh and eighth grader with a new laptop - approximately 32,000 students and 4,000 teachers - continues to provide a useful example of the size and type of commitment and risk that elected leaders have to be willing to make to transform the outlook for a state or regional economy. It took strong leadership and determination from then-Gov.

The Department of Education's Committee on the Future of Higher Education has released a second draft of its report on the state of American colleges and universities. As reported in the July 10 issue of the Digest, the document originally released by the committee harshly criticized the U.S. higher education system for wasteful spending, lack of academic rigor, and failure to serve the needs of the national economy.

While much of the attention in the national dialogue on competitiveness and innovation has focused on federal R&D investments and science and tech education, a 62-year-old independent organization of business and education leaders says our attention should be much earlier in the education process. A new report by the Committee on Economic Development (CED) asserts economic development leaders should make quality preschools a top priority.

Maine Gov. Mark Baldacci has unveiled a new handbook intended to help communities to capitalize upon their cultural resources to spur economic growth. Maine's Creative Economy Community Handbook: Maine State Government Resources for Communities offers advice for community leaders interested in building a creative and dynamic workforce. The guidelines it gives for designing a strategic plan could benefit communities across the country interested in similar initiatives.

As the authors of the recent Swedish report, The Internationalization of Corporate R&D, pointed out, industrial R&D may increasingly be found concentrated around public and private research institutions with strong research capabilities related to the specific corporation's interests.

Proponents for a higher skilled workforce may be concerned with troubling new statistics regarding high school graduation rates. A new report from the EPE (Editorial Projects in Education) Research Center and Education Week shows that more than 30 percent of the nations ninth-graders fail to go on to graduate from public high schools.

Nearly $300 Million Tagged for TBED
It took moving into a special session and negotiating a late deal between lawmakers and Gov. Brad Henry last week for the Oklahoma legislature to pass several bills related to the state's budget for fiscal year 2007, which begins this weekend.

Making the single largest TBED related investment in its history, the Arizona legislature approved and Gov. Janet Napolitano signed the state's FY 2006-07 budget, which includes $35 million for the new Arizona 21st Century Competitive Initiative Fund. HB 2477 is the successor in concept to the Innovation Arizona fund proposed by Gov.

Summer is road construction season for much of the country. A necessary inconvenience for maintaining our transportation system because connectivity is a fundamental requirement for commerce. For two parties to exchange goods, services or knowledge, they have to be able to find each other. The location and capacity of transportation infrastructures - sea ports, railways and interstate highways - very much determines the opportunity for and extent of economic growth.

A new National Science Foundation (NSF) report shows graduate enrollment in S&E increased by 4.2 percent from 2002, reaching a record high of 474,203 students in fall 2003. Graduate Students and Postdoctorates in S&E: Fall 2003 presents the distribution of graduate students in science and engineering (S&E) by academic fields, demographics, institution and state. Data contained in the report represent estimates of S&E enrollment from 12,261 graduate departments at 591 institutions in the U.S. and outlying areas.

SSTI, a growing nonprofit organization serving the nation's tech-based economic development (TBED) community, seeks a policy analyst to research and prepare reports, articles and papers on TBED and assist with SSTI events. Excellent research abilities, strong writing and verbal skills and solid understanding of government are required. Candidates must have ability to work independently or as part of a committed team and be dedicated to creating a quality product.

This week's Funding Supplement will be sent on Thursday, June 29. With the Fourth of July holiday, neither the SSTI Weekly Digest or Funding Supplement will be published next week.

The fifth installment to Walkin' the Tech Talkin' Gov Walk (see the April 17, May 8, June 5 and June 12 issues of the Digest) covers the outcome of the 2006 Massachusetts legislative sess

Four short years ago, 37 states were in fiscal crisis, many making several rounds of deep spending cuts to cope with the most dramatic reduction in revenues in 20 years. In all, more than $15 billion were shaved from state budgets. Twenty-one states experienced negative revenue growth in FY 2003, forcing even deeper cuts. The fiscal winter of '02-'03 slowed many states' strategies for supporting growth in their knowledge-based economies.

A $1.46 million grant from the Economic Development Administration to the Sirti Foundation is making possible a $3 million loan fund to technology companies within a 10-county region of Eastern Washington. The program provides another example of the non-traditional use of EDA funds to support tech-based economic development strategies. In addition, the deal structure may serve as a model to help other public agencies encourage TBED activities typically outside the scope or possibility of many public entities.

Despite industry claims to the contrary, the recovery of the U.S. information technology (IT) sector has not created enough new jobs for IT workers, according to a new report from the Washington Alliance of Technology Workers. Information Technology Labor Markets: Rebounding, but Slowly reveals that the recent increase in IT spending has not led to a full recovery in the labor market.

The federal government distributed $26.7 billion to universities in the U.S. in fiscal year 2003 - a 9.4 percent increase from the FY 2002 total of $24.4 billion, a recently released National Science Foundation report reveals. Federal Science and Engineering Support to Universities, Colleges, and Nonprofit Institutions: Fiscal Year 2003 details federal science & engineering (S&E) activities to the nation's institutions of higher education.

Southern Growth Policies Board, in partnership with the National Institute of Standards and Technology (NIST), has designed a survey to identify the needs of small and medium-sized manufacturers in the area of information technology. The 20-question survey takes only a few minutes to complete and the results will be used to develop new programs to help small and medium-sized manufacturers.

The fourth installment to Walkin' the Tech Talkin' Gov Walk (see the April 17 , May 8 and June 5 issues of the Digest) covers the outcomes of the 2006 legislative sessions within Colorado, Iowa, Minnesota and Vermont.

Does increasing a university or community college's involvement in tech-based economic development - through technology incubators or early-stage capital programs - detract from the nonprofit, educational purpose of the institution? Fortunately, for many state and regional TBED strategies, the Internal Revenue Service (IRS) says no. The IRS recently released a ruling affirming the nonprofit status of a college foundation planning to unveil a new high-tech incubator and pre-seed capital fund.