Tale of Two GRs
How the region’s thousands of displaced manufacturing employees can benefit from the new economy, however, remains to be seen.
There are probably a dozen cottage industries jostling for space in the West Michigan economy today. Biomedical, advanced manufacturing, sustainable business, information technology and digital animation are a few.
In his State of the City address last week, Mayor George Heartwell outlined a plan to support knowledge-based industry, asking for the legislature to adopt a tax incentive package to afford such companies the same luxuries the manufacturing sector has long enjoyed.
“This is the direction we’re going as a society, toward a knowledge economy,” he said in an interview prior to the speech. “Creating the new innovations and technologies that are coming out of research … That’s a great value to us, and we’ll help underwrite it the only way we can: tax abatements.”
Heartwell cited the region’s high rank in the world competitiveness index, a measure of an area’s knowledge base, as proof that Grand Rapids has potential as a research and development hub for the world. He also detailed plans to attract sustainable companies to the region.
A few months prior, Heartwell was met with another type of worker.
He had been speaking to an adult education class hosted by a local church. He was talking about life sciences, the medical and technical fields, and what he thought would be the future of Grand Rapids.
“And after the class, a fellow came up to me and said, ‘I’m 52 years old. I’m a die maker, my father was a die maker, and I was making $23 an hour,’” Heartwell said. “’I lost my job a year ago, and the company closed and I haven’t been employed since.’
“‘So, I take from what you said that I’m going to become a research scientist?’”
No, the mayor replied, “but you’ve got a lot of productive years ahead, and you’re simply going to have to learn new skills that can be applied to advanced manufacturing applications.”
There is an inherent flaw in the knowledge economy, according to George Erickcek, senior economist at the W.E. Upjohn Institute of Employment Research.
“I understand that as a community we all want an environment that is attractive to highly skilled individuals,” he said. “But at the same time, when I think about critical occupations, I think about highly productive, good-paying jobs that are within reach of the individuals who are unemployed or underemployed.
“The target for incentives should be the 45-year-old that has been in manufacturing for years and just lost his job because of productivity cuts.”
Attracting engineers, doctors and other highly skilled individuals does nothing for the workers made vulnerable through no fault of their own, he said. In fact, Grand Rapids’ efforts remind him of his home base of Kalamazoo. Not long ago, it was a knowledge economy.
“We did not know what it meant to have the research and discovery at Upjohn and the richness it provided our community,” he said of the pharmaceutical company consolidated into Pfizer.
That richness was not only in terms of income and intellectual capital; equally important were the spouses of Upjohn’s chemical engineers who were similarly educated and had a significant impact on the community, he said.
When Upjohn left via acquisition, those engineers slowly followed. Erickcek argues that when it concerns knowledge workers, efforts should focus on the firms, not on attracting individuals — a notion that is consistent with Heartwell’s plan.
Erickcek and Heartwell agreed upon the importance of retraining. The economist suggested health care or other career changes as possible solutions.
“As Spectrum Health grows, they are going to see a whole line of occupations opening up requiring different skills,” he said. “It will be pretty hard to train a manufacturing person to have a role in the VAI.”
Heartwell said he was discouraged by the state’s consistent trimming of resources for retraining.
“We’re not, as a nation or state, adequately investing in retraining our work force,” Heartwell said. Of equal concern, he assured, is K-12 education. “We have got to prepare our children with intellectual skills for problem solving.”
Erickcek also expressed concern about the career choices made at the postsecondary level, giving as an example a conversation he had when he dropped his car off for service.
“I was sitting next to this guy in a courtesy van, and he turns to me and says, ‘You know, if I knew being a dentist was just cleaning teeth all my life, I’d rather have driven a truck.’”
If universities push too hard to produce more engineers, accountants, doctors and other sorely needed knowledge occupations, they run the risk of “guiding people that 15 years later will decide they’re not happy.”