1	Regional Business Clusters & Economic Trends Inland Northwest Economic Adjustment Strategy October 2, 2003
2	Definition of “Clusters” “Geographically-bounded concentration of similar, related, or complementary businesses, with active channels for business transactions, communications, and dialogue, that share specialized infrastructure, labor markets, and services, and that are faced with common opportunities and threats.”
3	Cluster Study Methodology (4 States, 3 Reports) Data Used: NAICS (4-, 5-digit level), employment and revenue data Factors: high concentration of firms (Location Quotient, or LQ > 1), high wages, faster growth in employment than U.S. averages for specific industry Limitations: studies by different organizations using different methods of analysis; exclusion of non-employer firms; no in-depth analysis in ID
4	Oregon: 11 Clusters High Technology & Software Wood & Paper Products Food Processing & Agriculture Apparel & Sporting Goods Transportation Equipment Creative Services
5	Oregon: 11 Clusters Recreation-Related Metals/Machinery Nursery Products Professional Services Biomedical
6	Washington: 11 Clusters (6 in Report) Agriculture/Food Processing Forest Products Semiconductors Measuring Devices & Instruments Biotechnology Health Care
7	Washington: 11 Clusters (5 Others) International Trade Aerospace Aluminum Software/Internet Tourism
8	Idaho: 10 Clusters* Food Manufacturing Building Materials/Wood Products Computer & Electronics Transportation Information Construction/Heavy Equipment * Based on top-level analysis by Boise EDC
9	Idaho: 10 Clusters* Business Services and Support Veterinary Services Emerging Clusters: High Tech Instruments Outdoor Recreation Products * Based on top-level analysis by Boise EDC
10	Montana: 6 Clusters Wood-Based Products Agri-Food Products Experience Enterprise and Tourism Creative Enterprise Life Sciences Information Technology
11	Regional Cluster Themes Ag & Food Processing Wood-Based Products & Building Materials Info Tech, Electronics & Data Services Recreation & Tourism Biotechnology & Life Sciences Creative Enterprises Metals
12	Ag & Food Processing Cluster Farming, Ranching, Nursery Milling & Packing, Primary Processing Malt Beverages, Wineries & Bottled Drinks Prepared Meats, Fruits/Veg’s, Cheese, Processed Foods/Groceries, Baked Goods Refrigeration, Warehousing/Dist’n, Transp’n Machinery/Equip, Repair, Utensils, Research Wholesale, Retail, Restaurants, Exporting
13	Wood-Based Products Cluster Logging, Millwork, Planing, Log Imports Veneer, Plywood, Engineered Products Paper, Structural Parts, Flooring, Boxes, Posts & Poles, Log Homes, Pulp Prefab Homes, Furniture, Cabinets Machinery, CAD/CAM, Architects, Paints/Finishes Nurseries, Plant & Forest Management Services, Research, Pest Biocontrol, Irrigation Wholesale, Dist’n, Retail, Finance, Trans’n
14	Info Tech, Electronics & Data Cluster Hardware, Software, Communicatn’s Equip Measuring/Controlling Devices, Medical Instr., Search & Navigation Equip, Musical Instruments Semiconductors, Electronic Components Data Processing & Info Retrieval Services Engineering, Research, Testing Labs Machinery, Transformers, Broadcasting & Lighting Equip, Peripherals Facilities Management, Marketing, Distribution
15	Recreation-Related & Tourism Cluster Hospitality: Lodging/RV, Restaurants, Casinos, Outfitters & Guides, Visitor Info Services Products: Sporting Goods & Apparel, Galleries, Specialty Products & Foods/Beverages Attractions: Museums, Amusement, Parks, Festivals, Trails, Nat’l Forests, etc. Transp’n: Air, Car Rental, Coach, Rec Vehicles Promotion: Media, Tour Operators, Research Suppliers: Food & Bev, Furniture, Bed & Bath
16	Biotech/Biomed & Life Sciences Cluster Medical & Pharmaceutical Products, Bioinformatics Medical Devices & Equipment, Diagnostics Agricultural Applications: Crop, Veterinary Environmental Applications Research (Commercial, University) & Clinical Trials Food Security & Hazardous Substances Detection Labs, Contract Manufacturing, Compliance
17	Creative Enterprise Cluster Artists, Crafters, Entertainers, Writers, Performers, Musicians Production Companies, Entertain’t Venues Suppliers: Leather, Wool, Gems, Paper, Packaging, Fabrics, Lumber/Paint Equip: Kilns, Presses, Imaging, Sound, Software, Computers Services: Agents/Dealers, Ad Agencies, Studios, Printing, PR, Platemaking, Binding, Graphics
18	Metals Cluster Mining & Processing Fabricated Metal Products Electroplating, Polishing, Anodizing Foundaries Tools, Machinery, Cutlery, Mining Equip Valves, Pipe & Fittings Ornamental Metal Work
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20	Regional Economic Trends Decline in # of sawmills and mill jobs But NW production é (consolid’n, move west) Loss of family farms (consolidation) Growth in tech sector, innovation, research Growth in trade, services & health care Growth in tourism, conservation sector More small businesses/entrepreneurs Aging population, newcomers seeking QOL
21	Major Trends Affecting Biz Dev’t Global economy Knowledge-based economy E-manufacturing Shift to services Small business dominance Demographics: aging population, ethnic diversity Focus on workforce & education By 2006, 2 workers departing for every 1 coming in Shortage of 10 million workers by 2008 Quality of life: “Sense of Place” Regionalism
22	Trends: What’s New About the New Economy Increasing % of growing companies globally integrated, pressing for open international trade Increasingly digital and information driven Transformation to “e-businesses” that use Internet-platforms for integrating entire operation Innovation leading to highly customized information, services, & products (e.g., flexible production and mass customization; supply chain management)
23	Trends: What’s New About the New Economy Highly networked entrepreneurs who both collaborate & compete with one another Growth areas characterized by high concentrations of knowledge workers & an ability to attract & retain these workers Highly mobile & skilled labor force (“job churning”)
24	Assumptions: “Economic Development” is Happening When The standard of living is increasing A “real” increase in the level of average household income is occurring The local tax base is meeting the escalating cost of government services Business and industry is investing more in the community than they are “costing” the community
25	Assumptions: The Process is Facilitated Through Development of a skilled workforce Investment in the physical infrastructure Creation of new jobs at higher wages Improvement of the business environment Availability of marketable land and buildings Maintenance of the environment Improvement of the quality of life Marketing and promoting the region
26	Our INEAS Challenge Economic Adjustment that “Connects the Dots” between Sectors, Communities, Businesses and Markets Economic Development in Communities that Improves QOL Tangible Actions with Measurable Results Real economic growth (“Where’s the Beef?”) Focused Effort (Can’t be All Things to All People)