Amy Liu Presentation at Global Cities Indianapolis

A Joint Project of Brookings and JPMorgan Chase

GLOBAL CITIES INITIATIVEA J O I N T P R OJ ECT O F B R O O K I N GS A N D J P M O R GA N C H AS E

Indianapolis, IN- February 19, 2015@amy_liuw #globalcities

Post-Recession Jobs Recovery by Metro AreaPre-Recession Peak to 2014Q2

RecoveredNot recovered

Portland+1.6%

Indianapolis+2.9%

Cleveland-3.8%

Economic Challenges Vary

Kansas City-1.2%

Metropolitan Policy Programat BROOKINGS

Change in Employment Ratio of Working-Age Population2007 to 2013

IncreasedDecreased 0 - 3 pointsDecreased 3 or more points

Economic Challenges Vary

Portland-2.3

Indianapolis-2.6 Cleveland

-1.7%

Kansas City-0.6%

Source: Ezell, Stephen and Robert Atkinson, 2012, “Fifty Ways to Leave Your Competitiveness Woes Behind,” ITIF.

Traded Manufacturing Job

=Local Jobs

Traded Sectors Are Key to High Quality Economic Growth

State and Local Leaders Need to Focus on the Real Sources of Job Growth

1.9%job creation from firm

attraction

98.1%job creation from firm expansion & startups

Source: Conway Data Inc., Brookings analysis of NETS data at youreconomy.org.

1 2 31 2 3

The Imperative for Global Engagement

Metros Are Centers of Global Trade and Investment

Metros Are Engaging Globally

79%share of global economic growth occurring outside the U.S., 2013-2018

The Bulk of Potential Demand for U.S. Products Comes from Outside of the U.S.

Source: World Economic Outlook, International Monetary Fund, 2014.

Middle Class Consumption

5.9%North America23.0%North America

11.8%China & India53.2%China & India

2050

Source: Homi Kharas, “The Emerging Middle Class in Developing Countries,” OECD, 2010.

2013


Share of GDP Growth

‘09-‘13

Share of Job Growth

‘09-‘13

Exports Create Jobs, Generates Income, and Supports High Wages


International Exports’ Economic Impact

Sources: Moody’s Analytics; Brookings “Export Nation”; J. Bradford Jensen, “Global Trade in Services,” Petersen Institute for International Economics, 2011; David Riker, “Do Jobs in Export Industries Still Pay More?” ITA, 2010.

Manuf. Trade Wage

Premium

Services Trade Wage

PremiumMetropolitan Policy Programat BROOKINGS

Firms Benefit From Exports

Exporting

U.S. Manufacturing Firms Revenue Growth 2005-2009

Non-Exporting

Source: U.S. International Trade Commission, 2010, “Small and Medium-Sized Enterprises: Characteristics and Performance,” Washington,

2012 Both Years2011

Number of Firms Exporting

302,000

199,000

293,000

Though Volatile, Global Investment Flows Are Growing

1984 1999 2012

FDI Flows (Capital)

$2 trillion

$1 trillion

Source: UNCTAD

Global

U.S.

$1.3 trillion

$168 billion

The U.S. Is Capturing a Smaller Share of Global Investment

12 percent

26 percent

45 percent

1984 1999 2012

U.S. Share of Global FDI (Capital)

Source: UNCTAD

FDI Bolsters Exports and Innovation

U.S. Manufacturing

Exports

U.S. Manufacturing Employment

2%

20%

Foreign-Owned FirmsGoods-Producing Industries, 2011

Source: Brookings, Metro FDI, 2014; Bureau of Economic Analysis

U.S. Corporate R&D

U.S. Employment

5%

19%

Foreign-Owned Firms 2011

Advanced Industries

Innovation Human Capital Infrastructure

Pharmaceuticals

Medical EquipmentMotor Vehicles & Parts

Aerospace

Manufacturing35

Software Computer Systems Design

Telecommunications R&D Consulting Services

Services12

Oil & Gas Extraction

Electricity Generation

Energy

3

Advanced Industries


Advanced Industries Support High Wages

Wages

*Advanced Industries spend over $450 on R&D per job annually and over 20 percent of jobs are in STEM occupations. Source:Brookings “Advanced Industries”, Mark Muro


$90,000 > $47,000average advanced industry wage

average wage

Skills

1 out of 2advanced industry jobs require

less than a 4-year degree

Advanced Industries Drive Value Creation and Productivity Growth

PatentsGDP

Advanced IndustriesShare of U.S. Totals

R&DJobs Exports

*Advanced Industries spend over $450 on R&D per job annually and over 20 percent of jobs are in STEM occupations. Source: Brookings Institution forthcoming.


Advanced Industries Drive Value Creation and Productivity Growth

Advanced IndustriesShare of U.S. Totals

*Advanced Industries spend over $450 on R&D per job annually and over 20 percent of jobs are in STEM occupations. Source: Brookings Institution forthcoming.


GDPJobs R&DPatentsExports

IndianapolisRegion


Non-STEM STEM

Talent Matters to Innovation and Opportunity

High schoolor equivalent

Associatesor some college

Bachelors Graduate

Source: Jonathan Rothwell, “The Hidden STEM Economy,” Brookings, 2012

Median Annual Wages by Education and OccupationIn 1,000s



Jobs in STEM Fields Are Accessible


STEM Jobs as a Share of All Jobs

Share of STEM JobsRequiring 4-Year Degree

Source: Jonathan Rothwell, “The Hidden STEM Economy,” Brookings, 2012

178,910STEM Jobs

Indianapolis Region

$149 b

Top 100Metros

IndianapolisRegion

International Trade Share

15.8% 13.3%

Total Goods Trade

24th out of top 100 metros

Top Global Country/Region Trading Partners

1 Chicago $9.2 b

2 Indiana (Rem.) $8.4 b

3 Cincinnati $4.6 b

4 New York City $3.5 b

5 St. Louis $3.3 b

6 China $3.2 b

7 Canada $2.9 b

8 Louisville $2.8 b

Indianapolis Region Freight Profile

Source: Brookings, Metro Freight (2013) & Global Gateways (2012)

Metros are centers of global trade and investment

1 2 31 2 3

Bachelor’s Degrees

74%

92%

PatentsPopulation

66%75%

Graduate Degrees

90%

Advanced Industries

Source: Brookings analysis of US Census Bureau, FAA, BLS, and BEA data

Largest Metros’ Share of U.S. Market Assets

Air Freight

82%

Services Exports

72%

GDP

75%

Metro Areas Hold the Bulk of the Assets That Will Drive Exports

Source: Brookings Export Nation 2013, Census

Metropolitan Areas

Indiana

81% 75%78%

Population GDP Exports

Metros Have a Critical Role to Play in Exports

Increase export pipeline through proactive outreach in existing networks

Coordinate federal, state, and local programs on the ground

Catalyze cultural shift by mainstreaming exports and trade

Metro

State

Federal

Bring credibility of the Governor’s office to global trade

Establish a state brand platform

Organize trade missions

Dedicate resources to global engagement

Open new markets through free trade agreements

Finance exports through Ex-Im and SBA

Provide on-the-ground expertise in U.S. and foreign markets

Produce export data to inform state and regional efforts

1 2 31 2 3

Metros are engaging globally in new ways

METROINNOVATION

27

Organize for Trade

GLOBAL CITIES INITIATIVEA Joint Project of Brookings and JP Morgan Chase

Research Exchange Convenings

Goal Catalyze a shift in economic growth policy and practice that results in more globally competitive metropolitan areas, positioning them for high-quality growth and better jobs for more workers in the 21st century economy.

The Exchange Is 28 U.S. Metro Areas at the Vanguard of Global Engagement

Exports: New Cohort BaltimoreFresnoHoustonKansas CityPhiladelphiaSalt LakeSeattleSt. Louis

Exports: Current AtlantaCharlestonChicagoColumbusDes MoinesIndianapolisJacksonvilleLouisville-LexingtonLos AngelesMilwaukeeMpls-St. PaulPhoenixPortlandSacramentoSan AntonioSan DiegoSyracuseTampa BayUpstate SCWichita

ColumbusMpls-St. PaulPortlandSan AntonioSan DiegoSeattle

FDI Pilot

Each Metro Area Is Leveraging its Unique Specializations and Global Brand

We Build Green Cities

Portland

Health and Wellness

Minneapolis - St. Paul

Life Sciences

San Diego

Services and Canada

Syracuse

31

Organize for Trade Invest in What Matters


SUNY AlbanyNanotech Campus

Columbus

Clemson UniversityInternational Center for Automotive Research

Organize for Trade Invest in What Matters Network Globally

Chicago

Mexico City2nd largestMexican immigrant population resides in Chicago metro area

130Chicago-based firms with operations in Mexico City

$1.7 billiontotal bilateral trade of locally produced products

290,000tourists and business travelers between Chicago and Mexico City per year

GLOBAL CITIES ECONOMIC PARTNERSHIP

Exports Should be Part of a Comprehensive Approach to Economic Development

Global Research & Advanced Industries

Human Capital & Immigrants

Exports & FDI

Freight & Infrastructure

GLOBAL CITIES INITIATIVEA J O I N T P R OJ ECT O F B R O O K I N GS A N D J P M O R GA N C H AS E

Indianapolis, IN- February 19, 2015@amy_liuw #globalcities

Amy Liu Presentation at Global Cities Indianapolis

Presentations & Public Speaking

Transcript of Amy Liu Presentation at Global Cities Indianapolis