Recession and Economic Analysis

Build your economy by assessing community

May 4, 2009
Hard times present a fitting opportunity for communities to engage in useful self-reflection.

In this case, deep thinking on the regional economy could best be served by focusing on the fundamentals first, not the outcomes. I ask each person worried about their local economy to consider easy things.

Start by asking the hardest questions first. Put yourself in the shoes of a bright young college graduate who has never been to your town before. Do you have what this person might want? Are there any urbanization amenities? Is there a place to hang out on weekends? Do you have recreational opportunities? These are tough questions--find a college student who is home this summer to help you answer them.

It gets easier. Do you have the type of place a young family would want to move to? How good are your schools? If they are below average (and half are) then you are in trouble.

If you have any schools at the very bottom, that's a huge red flag to families. One bad school signals problems for much of the system and, rightly or wrongly, tags the whole community.

It is increasingly difficult for school systems to hide bad schools. Data is more consistent and available, and Internet searches of schools are now among the first thing anyone relocating to a community does.

The sad truth is that lots of Indiana cities and towns have much better economies than their school systems can support. Good schools are a necessary condition for economic development.

The general condition of a community also matters a lot for young families. There are entire book series on what that means, but let me simplify it in one sentence. If it is easy and safe to walk around, get to the grocery and school, and to deliver your kids to a safe play date, your neighborhood aids economic development efforts.

How are your institutions? In most places, the houses of worship are a bonus because they have stuck to an effective strategic plan for a long time.

How is government working? If your property taxes are significantly out of balance with the quality of schools and communities, then you have a problem. This may be hard to measure, but the signs of it are pretty straightforward.

Has your community moved out of the 1960s and privatized trash pickup? Do you have the right mix of public workers?

In the 1960s, we had lots of fire risk, but little crime. Today we have lots of crime and few fires. Has your community made the adjustment?

Is someone in your community using a computer to record land deeds, or is your town hall still employing Amish-friendly technology? The list goes on.

Today, all eyes are on the economy. So, during this recession, these problems are far more visible than in times past.

This focus on the economy also makes the remedies easier to implement. Honestly identifying the challenges in our communities is the first step.

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Hicks is director of the Center for Business and Economic Research at Ball State University. His column appears weekly. He can be reached at cber@bsu.edu. >
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