Sound economic development policy should consider productivity more than job creation. If a company is not productive, then it is not competitive, and it will not stay in existence for very long. However, advances in technology can displace employees. When that happens, productivity for the company increases, but the former workers still exist. This can be an opportunity.
The best approach for EDOs is to get ahead of the curve. Look for the trends. What advancements in technology are making certain professions easier/obsolete? What advances are encroaching into the areas that you see as your state or region’s economic strengths? You will want to look at the potential impact and try to determine the scenarios. If there will be a reduction of jobs in an industry, what will it look like? Data from your BRE visits will be the best source to gain this information.
Here are three things EDOs should consider when automation creates an excess of workers:
Identify what skills are in abundance amongst the population that are transferable and upgradeable. If there is a new technology that is reducing the need for CNC operators, can these employees be upgraded into CNC systems maintenance workers, and how many will be needed? After identifying the upgradeable skills, work with the workforce development entities within the region to build programs that increase the level of employees within that population.
Obviously, not all of the employees will be needed at this higher talent level. In addition, not all of them will be upgradeable. So, are there other industries or other businesses within the same industry that can use that talent? If businesses follow talent (as they do these days), then the reduction in jobs will present a marketable labor pool to attract new businesses.
Finally, encourage small business and entrepreneurial development. This is something that EDOs should always do. However, it is even more impactful when there is large displacement within an industry. The disruption in the economy is an opportunity to start new enterprises that can utilize the existing talent.
For more about talent and other economic development strategies, or to learn about Ady Advantage and the services we offer, visit our website at www.adyadvantage.com or give us a call at 608.663.9218. I or a member of my team would be happy to speak with you.