When Bob Potts gives the elevator speech of what he does as research director of the Nevada Governor’s Office of Economic Development, he groups his work into two buckets: 1) data collection, analysis, and dissemination and 2) performance metrics.
In part 1 of EMSI’s webinar series for economic developers, Potts focused on both elements of his job and how he uses EMSI data and software to simultaneously speed up and deepen his research of the state’s economy.
You can listen to a video recording of part 1 below and access Potts’ slides (PDF). In part 2, EMSI’s John Pernsteiner will discuss how to apply these same and other research principles in your region (Update: View the video and summary of part 2.)
Potts’ presentation covered how he uses data from EMSI and other sources to do the following:
- Respond to requests for information (RFIs) from site selectors and consultants
- Approach strategic initiatives, like his analysis of advanced manufacturing in northern Nevada since the arrival of Tesla Motors
- Analyze subsector performance by looking at their concentration (location quotient) over time
- Find import substitution opportunities (filling holes in local supply chains)
- Give an economic outlook for the whole state or specific regions
He also walked through how he uses data to keep tabs on key performance metrics based on major economic development initiatives such as the recruitment of Tesla.
Nevada created the Governor’s Office of Economic Development in 2011 after Gov. Brian Sandoval was elected. Potts came on board in early 2012, and the immediate focus for him and his colleagues was to diversify the state’s economy. Long known for tourism, gaming, and entertainment (as well as for mining), Nevada focused its effort on five additional sectors after an in-depth Brookings/SRI International study.
The state also emphasizes supporting and recruiting businesses that supply “primary jobs”—those that bring money into the region based on the goods and services exported out of the region. This ties into diversifying Nevada’s economy, since most of the new money flowing in has been from tourists spending discretionary income.
“It’s our goal to figure out how we can help primary companies become profitable,” he said.
Advanced Manufacturing Analysis
With this as a backdrop, Potts explored how he can mix and match groups of occupations and industries with EMSI to quickly respond to RFIs and then turned his attention to advanced manufacturing in the northern part of the state. Tesla, with partner Panasonic, is expected to bring 6,500 jobs to the Reno area as it invests in a $5 billion advanced battery plant.
Since Tesla chose Nevada over a number of states last fall, Potts and his colleagues have turned their attention to developing a skilled workforce to support the growth in advanced manufacturing. But what industries compose advanced manufacturing? Potts compared it to defining blue-collar and white-collar jobs; it’s open for interpretation.
He settled on Brookings’ advanced industries definition based on R&D investment and the share of STEM-related workers. It included 35 manufacturing industries at the 4-digit NAICS level, which he broadened to 175 6-digit industries (including industries tied to Tesla that Potts added).
With raw QCEW data from the state and EMSI, Potts was able to determine the advanced manufacturing establishments and jobs in a four-county region in northern Nevada. He used EMSI to look at aggregate job counts, growth, earnings by county and for the four counties together. He also looked at the concentration of the largest-employing industries to see the region’s comparative advantages (see chart below).
Note: To put concentration in level terms, Potts took the job number for each industry shown and divided by the location quotient to come up with what the US equivalent would be.
Potts also used EMSI to look at the supply chain of advanced manufacturing industries in northern Nevada to see the amount spent on inputs supplied by local industries and how that compares to out-of-region spending. This information is valuable to take to existing companies in the area to explore opportunities for them to expand.
“Whenever we can do that, that’s import substitution,” Potts said. “Import substitution is the same thing as stopping the leaks in the economy so that our wealth doesn’t diminish, but it at least holds it own. Then we add primary jobs on top of that, and the wealth in the region expands, which again is the reason behind what we do.”
Potts titled his presentation Economic Research for Economic Development because he views data analysis as a means unto an end. He always tries to have the big picture in mind when he’s sifting through columns and rows of data. And the less time he has to spend collecting data, the more time he has to analyze and share it—which goes back to the core of how Potts views his job. With this in mind, he said EMSI’s data software is “a very important tool in my toolbox for how I do research specific to economic development.”
Here are other takeaways from Potts’ presentation:
- He highly recommended using the Census Bureau’s OnTheMap tool to look at commuting patterns—how many residents are leaving your region to work elsewhere and how many people are coming into your region for work.
- Near the end of his presentation, Potts gave a summary of an excellent economic outlook he produced for a company site visit to Clark County. It included trends on population, employment, unemployment, personal income, retail sales, as well as details on the company’s industry (see slides 33-62).
- Good researchers like Potts use a variety of data sources and get a variety of perspectives. In addition to traditional employment numbers, Potts uses EMSI’s job posting analytics to get an indicator of where hiring is headed.
Register for part 2 of our webinar series here.
The data highlighted by Potts is available in EMSI Developer, the latest in the line of data software provided by EMSI. Designed specifically for economic developers, it offers tools for strategic planning, recruitment, workforce analytics, and a regional dashboard—along with national data at the county and ZIP code levels. For more information, click here. Or, to schedule a demo, please contact us.