Author Archives: Shabaka Gibson

Advice for Policy Makers: Productivity Versus “Job” Creation

Economic development incentive policies have often centered on job retention and creation. Historically, this was in line with productivity (you need people to do the jobs to be productive) and politics (people vote, so if you protect or create jobs, then they will vote for you). Today, things are not as aligned.

With the growth of automation, the 1099 workforce (contractors, self-employees, outsourcers, etc.) and increased global competition, policymakers have to deal with a tricky question: Should the intent of economic development policy be to incentivize productivity or job creation? Besides, what does job creation look like these days anyway?

To answer the first question, policy makers, in particular, should take an approach to economic incentives that recognize the impact of productivity and competitiveness. 

So what about automation?

It is important to understand the impact that automation has on the economy. Automation in its purest form is nothing new. We have the word “sabotage” from the French workers who threw their sabots into the machines that were taking their jobs. However, we still have tons of fashion designers and apparel manufacturers working in the shoe industry. There are other examples of automation disrupting job markets but not destroying them, think about the auto industry circa 1980s. 

What’s important is the long-term effect on productivity. Society is always better off with a higher producing, automated workforce. The employees who have worked in those automated industries have not disappeared. They have elevated their level of input. For example, when software reduced the number of accountants companies needed to make calculations, accountants did not disappear. They went from building and calculating spreadsheets to analyzing them. In other words, their level of productivity elevated. This, in turn, took the automating technology (in this case spreadsheet software) and turned it into a tool whose mastery was necessary for success in the profession. As a result, general productivity in the profession and the companies increased.  




What about 1099ers? 

The 1099ers, also known as contractors, freelancers, temps or other individual contributors (IC) are a large and growing part of today’s economy. If you are not convinced of that, I can explain it further over an Uber ride. They add value to companies and the economy through the temporary nature of their productivity. Since the individual contributors are not employees of the companies, they add to productivity without adding to legacy costs. Thus, old ways of thinking of incentive policies will not work for them. Their temporary work and targeted value depend on continual patronage by companies and consumers who need their goods and services on a repeating basis. The value that they added to society is through the unique and highly specialized nature of their contribution to the economy. They are a part of the economy when they are producing value. When they are not productive, they automatically disconnect. Also, because it is impossible for ICs to benefit as free riders, their input into the economy more accurately mirrors the overall value of the goods and services that they provide. These individual contributors are the embodiment of Adam Smith’s invisible hand.

However, their value to the economy is often overlooked in favor of the traditional models of employment. From a policy perspective, there is a dangerous scenario where low paying, low skilled FTE jobs are valued higher by policy makers than high skilled, higher paying non-FTE positions. In this scenario, productivity is sacrificed for jobs that are less stable, less productive and easily transferrable. Incentivizing this scenario degrades the economy.

So, this brings me to the second question, what does job creation look like. For policy purposes, economic development incentives should take into consideration the following factors at a minimum: wage rate, level of skill needed (low skilled, semi-professional, professional), total number of jobs created, industry of the jobs created and permanency of the position.

From a policy perspective, all jobs should not be viewed the same. Some industries are highly temporary in nature – construction for example. However, the industry itself survives on doing project after project. If they complete a project on time, on budget and at a high quality, they can land another project. What they don’t do, is finish a project and keep constructing the same project. Construction workers are temps, for all intent and purposes. However, the construction industry is a stable industry. That work and those jobs should count for something.  

Policies that only look at permanent job creation are out of touch with today’s economy. Policymakers should view jobs by the value that they add. Incentive policies should not weigh low wage retail jobs higher than they weigh high-value engineering service consultants simply because the retail jobs are “permanent”.

Permanent jobs are important but in today’s economy, it is not the only source of productivity for companies. If a company is not productive then it is not competitive, and it will not stay in existence for very long. Smart policy makers should take this into consideration when designing incentives to strengthen and grow their economies.

For more about incentive policies or to learn about Ady Advantage and the services we offer, visit our website at or give us a call at 608.663.9218. I or a member of my team would be happy to speak with you.

Workforce Readiness Certifications as a Talent Development Tool

There has been a lot of effort recently to certify communities and workers as workforce ready. I applaud any effort that helps to improve the talent picture within a community. However, I believe that there is a deeper play for these certifications.

Workforce readiness gives an indication of an individual’s readiness to perform at a basic level. The certification tests tend to be given to high school juniors and seniors at the earliest, but more often, to post high school graduates who have not gone on to college, tech, or trade schools. I argue that if a community is going to use these certification tests, they should be given to students as early as the 8th or 9th grade. From there, these students now have time to work on their areas of deficiency. 

My rationale is pretty simple. If you give a workforce certification test to a young adult after they have left high school and they don’t qualify, they have limited options. They are no longer in the school system. Thus, the options are: 1. Society gives the young adult condolences on not being prepared to work or 2. The community has to invest additional resources to get that person to the most basic level of workforce readiness.

To be competitive for medium to higher wages, they will need more.

If the test is given at the 8th, 9th or as late as the 10th grade, there will be awareness. There will be time to work on the student’s workforce readiness while society is still obligated to spend resources on that student. In my opinion, the earlier, the better. Once individual workforce readiness has been established, it should be the basis from which a student increases their usefulness to employers – meaning tech, trade, 2-4 year college.   

Individual workforce ready certification is no substitute for individual trade certification, technical training, or higher degrees. However, workforce certifications can be used in a way that adds value to the education and workforce training process.

For more about talent strategies or to learn about Ady Advantage and the services we offer, visit our website at or give us a call at 608.663.9218. I or a member of my team would be happy to speak with you.

Building Defense Economies Resilient to the Defense Industry

The defense industry is notorious for its boom and bust cycles. Almost anything can affect it, including public policy, global affairs, technology, and funding. For some local economies that are heavy into the industry, this can, at times, cause economic uncertainty. Employment goes up and down, talent disperses, and the robustness of the local economy is at the mercy of the next congressional budget cycle.

Defense-based economies can find success and stability by diversifying vertically and horizontally through the industry. What do I mean by this? Every economic sector overlaps with others. Defense is a great example of this as it touches on everything, and that creates economic opportunities for communities.

To diversify vertically, look at what areas of defense your local businesses are currently serving. Also look at areas of the defense sector that could be served by the current assets in your community but are not. Try to attract growth opportunities that can take advantage of these assets as well as support the existing defense businesses. The goal would be to build a defense sector economy that is diversified on the supply chain front, from top to bottom.

Additionally, the workforce and other regional assets may be useful to other sectors/industries. Remember, defense doesn’t operate in a silo. It is a sector of the economy that cuts across multiple industries. Thus, understanding the full spectrum of industries in your area could yield non-defense related growth. The goal should be to have businesses with similar labor and other asset demands but do not depend solely on the defense industry. This would allow for workforce absorption during the bust cycles and add resiliency to the area’s economy.

Defense will always be an appealing target for many companies. But that target is often not as stable as many would like. By diversifying vertically within the industry and horizontally into industries with similar asset demands, a community can help shield itself against the pitfalls of defense spending cycles.

For more about defense community growth strategies or to learn about Ady Advantage and the services we offer, visit our website at or email us at [email protected]. I or a member of my team would be happy to speak with you. 

AS I SEE IT | Building Talent Attraction Strategies that Work

As most economic developers will tell you these days, businesses go to where the talent is located. So, many regions understand that business attraction often means talent attraction. Here are a few thoughts on building talent attraction strategies that work.
  1. Realistically identify your assets.  Similar to site selection, there are assets that communities can sell to potential talent. Sometimes it’s a great climate or access to outdoor amenities.  Other times it’s a sleek urban lifestyle, high density of jobs in a specific industry, low cost of living, or maybe just a favorable brand. Every place has something to offer. It is important that every community identifies its competitive advantages and is honest about its shortcomings.
  2. While identifying your assets, don’t forget that there are different layers to your strengths. People are dynamic, and their lives are layered. There are social, professional, and recreational aspects of people. Each aspect matters when trying to recruit talent. Looking at talent attraction in this manner allows communities to narrow their focus and make more relevant pitches to potential new residents.
  3. Don’t forget your students. I often hear that students at the local colleges and universities stay on or near campus, and then leave when they graduate. It’s important to understand that students don’t live in your community. They live in “student world.”  It’s this magical place where everything important is within a brisk 15-minute walk or an easy bus ride away. This isn’t their fault. They are focused, as they should be. Once school is over, they get the opportunity to join the rest of the world. Communities and regions should consider strategies that court them while they are students, not when they are about to graduate. In addition, since they are living in “student world,” they are not yours to retain. So, approach them with a mindset of talent attraction.
  4. Speaking of retention, my last thought is simple. Don’t forget to retain the talent after you attract it. There are a plethora of great strategies to attract talent to an area. But if a person doesn’t integrate into a community, then they are susceptible to being poached by another community. Some of this can be avoided by adequately targeting the right talent to recruit. Nonetheless, ensure that you help create a sense of ownership over time. A good talent attraction plan addresses community integration as part of the strategy.
For more about talent attraction and retention strategies or to learn about Ady Advantage and the services we offer, visit our website at or give us a call at 608.663.9218. I or a member of my team would be happy to speak with you.