Brookings report: St. Louis’ economy doing better than many older industrial cities | St. Louis Public Radio

Brookings report: St. Louis’ economy doing better than many older industrial cities

May 8, 2018

In a Brookings Institution study of 70 older industrial cities, St. Louis ranks among the ones with stronger economies that are making progress on the road toward renewal and reinvention.

“It’s been one of the stronger economies in terms of job creation, in terms of good job creation,” explained Alan Berube, a senior fellow at the Brookings Institution in Washington, D.C., and co-author of the study. 

“The jobs, on average, are getting better in the St. Louis economy, and incomes and employment are increasing at faster rates locally than they are in a lot of older industrial cities.”

The report, called “Renewing America’s Economic Promise through Older Industrial Cities,” places cities in four major groups based on their economic performance from 2000 to 2016:

  • Strong older industrial cities (16 ) are not growing particularly rapidly, but achieve high marks on prosperity and inclusion (ex: Pittsburgh, Pennsylvania. and Waterloo, Iowa)
  • Emerging older industrial cities (24) are regionally diverse and exhibit average marks among all urban counties on prosperity and inclusion (ex: Providence, Rhode Island, and Louisville, Kentucky)
  • Stabilizing older industrial cities (16) generally rank among the bottom third of all counties on measures of growth, prosperity, and inclusion (ex: Akron, Ohio, and Indianapolis, Indiana.)
  • Vulnerable older industrial cities (14) rank among the bottom 5 percent of all urban counties on a combined index of growth, prosperity, and inclusion (ex: Macon, Georgia, and Flint, Michigan)

Berube says several cities, including St. Louis, Pittsburgh and Baltimore, are strong because, “They are combining the things they knew how to do from the past into new kinds of sectors and industries.” The transition from a former industrial/manufacturing economy to the knowledge economy of the 21st century requires brains, not brawn.

“In a knowledge economy it’s about what your people know and how to do it. It’s not what your machines are good at. [St. Louis] does share this characteristic [with other strong cities]. It’s got talent, it’s got vestiges of its industrial past that are actually finding new forms of value in the modern economy,” Berube said.

While St. Louis was known for manufacturing automobiles, shoes and beer in its industrial era heyday, Berube points to the city’s diversified economy as one of its lasting strengths. St. Louis boasted a wide range of jobs in wholesale, retail and media in the past. Combined with the fact that it served as a transportation hub and home to many big corporate headquarters, St. Louis had a strong talent pool as traditional industry began to decline.

Like many of the cities profiled in the Brookings report, St. Louis became an “eds and meds” location, with strong universities and health care-related businesses. Berube said these newer industries along with the continued presence of strong agriculture businesses are “combining to make the city nationally a pretty prominent center of ag tech and bio sciences, which are big competitive advantages in the U.S. and on the global scale.”

Declining cities face similar challenges

The Brookings study finds one common trait that all older industrial cities share: segregation and racial disparity. Berube says economic disparity is a major obstacle that all cities must address if they are going to grow and transition beyond their manufacturing pasts. “Programs that focus on diversifying the next workforce and the workforce that is going to have access to the really good jobs, that’s an important thing to do because that kind of disparity can hold back economic growth.”

While the analysis of 70 cities concludes that there is no one model or magic formula to renew older industrial cities, Brookings researchers do provide examples of programs, city-state partnerships and investments that are working around the country.

LaunchCode, a St. Louis startup that teaches computer code to non-traditional students and helps them get apprenticeships that lead to permanent jobs is highlighted as a success story in the report.

Berube has some specific advice for St. Louis: “Missouri as a state ought to be looking at other states that are doing a better job of valuing their older industrial cities,” he said.

“Massachusetts has put a lot of investment in cities in terms of resources, but also placing government talent into its older industrial cities to help in their economic revival. Ohio has invested a lot into innovation, research and development in its major cities, and it has succeeded in getting universities to collaborate better with business.”

For many years, the practice of economic development focused on recruitment — cities competed to lure the biggest new company to set up shop in their town. It’s more complex than that now. Cities, according to the Brookings study, need to be more entrepreneurial and build on past strength, while inventing new industries that can employ a much more diverse workforce with the talents needed to fuel a digitized economy.

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