EMSI CASE STUDY (Full Archive)
In her 2013 State of the State address, Oklahoma Gov. Mary Fallin unveiled a long-term economic development plan that focuses on wealth-generating, job-producing industries. The foundation for the statewide strategy was an exhaustive data analysis – a months-long process that was simplified using EMSI Analyst.
Scenario: Governor Seeks Economic Development Initiative To Use as Policy Guide
Oklahoma has one of the strongest economies in the nation. Its manufacturing sector is experiencing a revival. Job growth is strong. The cost of living is low. All this is well and good, but Gov. Mary Fallin wanted to know how the state could accelerate its economic growth and prosperity.
After she took office in January 2011, Fallin started pushing for a statewide economic development initiative that could be used as a guide for policy, incentives, infrastructure upgrades, and more. First, though, she asked for a detailed examination of the state’s economy. “Gov. Fallin is very economic development-oriented; this is her issue,” says Deidre Myers, the director of policy, research, and economic analysis at the Oklahoma Department of Commerce. “She wanted to understand our economy, and she wanted to have a strategy that really worked.”
Challenge: Researchers Focus on Transparent Way To Look at State’s Economy
Myers knew any analysis and subsequent economic strategy would need to be transparent to fit the governor’s overarching goals, and it couldn’t be a drain on the state’s resources. Given those constraints, Myers and her team searched for the best way to analyze and fully understand the Oklahoma economy, and how that knowledge could be applied to a strategy for the state and the state’s workforce regions and other areas.
Myers ultimately proposed an in-depth analysis to find the state’s strongest economic systems, or what the state refers to as ecosystems,[1. Myers focused on economic systems rather than traditional cluster analysis because the state was working toward a policy strategy. “We wanted to think systematically,” she says. “So this is really about policy economics, and understanding that there are economic systems; there are industries that come together. They require the same kind of workforce, but they may not be cluster-oriented.”] that balanced three factors:
- Wealth generation (sales revenue, export share, and wages);
- Growth potential (new markets, industry trends, and number of establishments); and
- Competitive advantage (location quotient, physical assets, workforce).
Gov. Fallin and Secretary of Commerce Dave Lopez approved Myers’ idea of weighing 72 data variables across 669 industries – more than 48,000 data points in all. It was an imposing task, and Myers and her team needed a way to assemble all this labor market and economic information in a way that was uniform, trustworthy, and ready to be analyzed.
Solution: EMSI Analyst Cuts Down on Time, Pain of Data Gathering
Myers found the bulk of the data she and her team needed in one place: Analyst, EMSI’s web-based data tool. Myers has used EMSI data for more than five years for state- and county-level research and analysis. For this project, she used Analyst to gather the baseline industry information (at the five-digit NAICS level), as well as data on each industry’s sales, exports, wages, and multipliers in the input-output section of EMSI’s tool.
The advantage that EMSI gave us is that a vast majority of the data we wanted to use was in one spot, and it was already clean and formulated for us. So all we had to do was move it into our spreadsheet.” — Deidre Myers, Oklahoma Department of Commerce
When the industry analysis was complete, she used EMSI to explore the 100 occupations most critical to the success of the state’s five strongest ecosystems. These occupations were determined based on wages, a staffing matrix for those economic systems’ industries, and comparisons with the nation and other states’ growth. For those occupations and the state’s workforce in general, she also looked at the existing and required educational attainment to give policymakers a sense of how equipped the state was to fill these critical occupations.
“The advantage that EMSI gave us is that a vast majority of the data we wanted to use was in one spot,” Myers says, “and it was already clean and formulated for us. So all we had to do was move it into our spreadsheet.”
Outcome: State Chooses Five Ecosystems To Prioritize
The exhaustive research that Myers and her team completed yielded five clear economic systems that have outperformed the rest: aerospace & defense, energy, agriculture & bioscience, information & financial services, and transportation & distribution.
The state plans to align and prioritize resources to strengthen these five groups of industries. The ecosystems will be the focus of business retention, expansion, and recruitment (particularly to fill in gaps in the supply chain), as well as incentives, regulations, and infrastructure upgrades.
Just as importantly, the state is already working to bolster the workforce for the aforementioned 100 occupations most important to the five ecosystems. Myers’ research indicated that roughly half of the new jobs for those 100 occupations are expected to require a certificate or postsecondary training below a bachelor’s degree. With that in mind, the Oklahoma Senate has approved a bill that will expand the state’s major scholarship program, dubbed Oklahoma’s Promise, to cover 100% of tuition and expenses for students pursuing an associate’s degree directed at jobs in those five ecosystems.
The strategy is playing a key role in other proposed policy changes, too, namely changes to the state’s primary economic development incentives program to ensure that all the industries in the state’s main ecosystems qualify.
“It took a little time and effort, but I think we’re very happy with it,” Myers says of the plan and process the state took. “And the governor was definitely happy because it sets a strategy that is data-driven. It’s not subjective to political party. It is built on the assets, the competitive edge we have within the state. It is both urban and rural. And it also answers those people who claim incentives or any economic development program is corporate welfare, because we can show that we are not choosing these businesses or these industries. The market in Oklahoma has chosen these winners. We have identified these winners, and now what we’re going to do is make sure they have everything they need to be able to be successful. If there’s a hindrance, we want to make sure we get rid of it.”
More about Oklahoma’s strategy can be found here.
Myers participated in an interview about her research and the state’s strategy with Oklahoma Horizon TV. Watch here or below.
Economic Modeling Specialists Intl. (EMSI) provides industry-leading employment data and economic analysis via web tools and custom reports. EMSI has produced more than 1,200 comprehensive impact analyses for colleges and universities in the US and internationally, and its web tools — Analyst and Career Coach — are used by thousands of professionals in higher education, workforce and economic development, and the private sector. For more information, visit economicmodeling.com.