Preparing an Economic Development
Strategy in Ten Easy Steps
BY CHUCK ECKENSTAHLER AND CRAIG HULLINGER
Many of these questions can be answered by data obtained
primarily from the U.S. Census Bureau. This information can
provide a narrative and quantified description of who we are
Every local governmental official is now challenged with the
and who makes up the workforce. It can also identity their
need to promote jobs and new investment in their community.
education and job skills. According to business site locators,
The question asked is “How does our community accomplish
available workforce is one of the top criteria of any firm
seeking to expand or locate a new business operation.
This question is often answered by chamber of commerce
QUEST I ON 2 - WHAT I S OUR ECON OMY?
members, government employed professional economic
developers, and/or an assembled group of academics. These
It is usually simple to identify the major employers. This
individuals usually work with a large group of interested
typically includes school district and hospital. The city or
individuals offering their opinions of what programs and
county government and a few major businesses are also
activities should be undertaken by businesses and government
major employers. They account for a substantial number of
to stimulate the local economy.
jobs located in the community. However, there is a large
segment (some estimate 80%) of jobs that is provided by
The recommendations might include an improved effort to
smaller business that often-times is overlooked in this simple
retain existing businesses or an effort to attract new businesses.
tabulation. Small businesses are the primary generator of
Tasks could also include developing a business park or
improving education to provide more skilled employees. It may
also include efforts to improve our neighborhoods and
downtown business districts to attract young well-
educated adults who wish to live and work in an
attractive and exciting community.
The responses differ, typically having as many
variations as there are people discussing what should
be done. To the lay person, preparing the community
economic development strategy can be an
overwhelming and complex task; being something
Part of the City of Peoria’s Economic Development Plan, the Innovation Center on Main Street.
“best left to the professionals.”
Data from the U.S. Census, U.S. Department of Commerce and
The truth is that strategic economic development planning is
state employment agency can be useful in providing a narrative
rather simple. It is not rocket science. This article seeks to
and quantified description of the number and type of jobs in the
demystify preparation of an economic development strategy,
community. This data allows examination of the number of jobs
simplifying the process into ten easy tasks. By answering
and wage scale of the current jobs in the community. It can also
simple, easily understood questions, a group of people can
help identify the growth (or decline) of these jobs over time,
prepare a strategic plan organizing an economic development
which is important to know to determine what specific jobs the
program for their community.
community currently has and what types of jobs that the
community would like to attract.
QUESTION 1 - W H O ARE W E ?
QUEST I ON 3 - WHAT A RE OUR PROBLEM S AN D
A simple question! Yes, we know we are a community of, for
OPPORTUN I TI ES?
example, 5,000 people. That’s correct, but what do we know
about ourselves? How many people do we have in the workforce
This is a more difficult question answered by a detached
and what are their ages? What jobs do they do and how much
unemotional critical evaluation of “community
and what type of education do they have? How many are
unemployed or underemployed? How many kids are in school,
when will they graduate, how many will go on to college and
P R E PA R ING A N E CO NO MIC DE VE LO P ME NT STR ATE GY CO NTIN U E S ON PAG E 8
how many will obtain other advanced technical training?
MAY 2009 | ILLINOIS MUNICIPAL REVIEW | 7
PREPAR I N G AN EC ON OMI C DE VE L O PM E NT STRATE GY C O NTINUE S QUEST I ON 5 - WHAT DO WE WA N T TO BE - O UR
FUT URE VI SI ON ?
One way to answer this question is to complete what
researchers call a “SWOT” analysis. To complete a SWOT Of the ten questions, this question is the most difficult to
analysis, the community lists its economic Strengths, answer - what do we want to be?
Weaknesses, Opportunities and Threats.
This question is most often answered by a carefully worded
The completed list provides information identifying unique vision statement, prepared by the consensus of interests that
opportunities for existing business expansion and opportunities places into words a mental image of what the desired future
for recruiting new businesses. It also identifies weaknesses and should be. The phrase “Our Future Vision is that our
future threats which may discourage business expansion and community will be the premier regional location for
new business location, which may be remedied by specific business investment in 2015” is an example of a vision
community action. statement.
For example, the SWOT analysis might disclose that the This statement tells a big story. It proposes that the community
workforce has a concentration of skilled computer-operated will be the premier location for new business investment when
machine tool makers. This workforce can be offered to compared to surrounding areas. It also provides a means to
prospective businesses needing such workers. It may also measure comparative success by measuring economic indicators
disclose that the farmland designated for industrial such as 1) increased jobs, 2) an increase in number of
development has no water and sewer and is not “shovel ready” businesses, and 3) an increase in business tax base within the
for a business to immediately begin construction. community. It also gives a time period to measure success.
QUESTION 4 - W H AT ARE OU R S T RE N G T H S? QUEST I ON 6 - HOW DO WE G ET THERE?
Like a well-trained prize fighter, who patiently waits to use his With an understanding of our strengths, weaknesses and
“best punch” to win the fight, an economic development strategy opportunities plus a vision of what the community wants to be
must identify the community’s economic development “best in the future, answering this question may become clear. The
punch.” Completing the SWOT analysis helps identify unique answers become a list of specific actions that must be
economic strengths that can define the “economic development completed to either eliminate defined weaknesses, or maximize
knock-out punch” for use in the fight to create new employment identified strengths to capitalize on identified opportunities.
opportunities in the competitive global environment.
Identifying the “knock-out punch” is
sometimes easy. It might be a unique
geographic location affording superior
logistic transportation amenities. Or it
might be proximity to a nationally rated
university. Perhaps it might be a young
highly educated available workforce. It
could be an attractive recreational or
small town residential lifestyle that the
community offers to new residents.
Regardless of the type of strengths
identified, analysis of community
strengths is necessary to select those
specific opportunities that can be used to
create new jobs within the community.
The area just south of downtown Peoria is a mix of
old industrial lofts, one story industrial buildings, and
vacant lots. This area will become a vibrant mixed -
use residential and commercial neighborhood. Some
of the old industrial lofts will become condominiums
similar to the successful development of the buildings
on Water Street. The street level space can become
viable commercial and retail space.
8| ILLINOIS MUNICIPAL REVIEW | MAY 2009
The chart may also identify the need to involve other
organizations or recommend formation of new entities to carry
out specific work tasks. We might need a downtown
development organization to sponsor a downtown
redevelopment plan or a neighborhood redevelopment
organization to sponsor redevelopment programs.
QUEST I ON 8 - WHO I S RESPON SI BLE?
Part of the City of Peoria’s Economic Development Plan, construction begins on the
Methodist Medical Center. The key to successful implementation requires gaining
commitments from specific individuals to complete work tasks.
This “buy-in” of responsibility is critical to success.
For example, the lack of “shovel ready” sites can be remedied by
investment in utilities, roads and governmental approvals
In our model economic development strategy, the mayor, public
necessary to have the site ready for construction immediately
works director, city planner, economic development director,
upon receipt of a building permit. Another action may be a Tax
president of the community college and chamber of commerce
Increment Financing District or a Business Development District
director would be named as “responsible parties” and charged
or a Special Service Area to provide incentives for business
with the duty to complete one or more specific work tasks.
investment. Other actions may include completion of community
appearance projects, securing worker skill training programs for
QUEST I ON 9 - HOW M UCH DOES I T COST?
laid-off workers, or conducting a national marketing program to
recruit new businesses to locate in the community.
Undertaking an economic development program costs money,
typically more that any single organization has within its budget.
QUESTION 7 - W H AT RE S OU RCE S D O W E HAVE
Answering this question establishes a budget for each work task
and identifies who is to provide the funding for the task.
Every community has resources, typically scattered among a
QUEST I ON 10 - HOW DO WE K N OW WHEN WE
large number of separate organizations. The key to answering
G ET THERE?
this question is identifying these resources and involving
them in developing the economic development strategic plan
In every successful economic development program the progress
with agreements to “take-on” and fund specific work tasks.
towards completion of each work task is periodically reported. It
A chart can be prepared listing the specific work task identifying
gives the opportunity to celebrate success and to modify the tasks
the person or organization that is responsible for the task, when
if necessary to assure successful accomplishment.
the work is to be
completed and how EXAMPLE O F S TR ATEGI C PLAN WORK TASK CHART
Measurement tools to gauge progress are
it will be funded.
critical. Useful milestones to measure
E CO N O MIC D E V E LO PMENT STR ATEGIC PLA N
Preparing this chart
success should be included as part of the
W O RK TA SKS
early in the strategic
Funding Responsible Completion Measurement
also identifies work
Work Task Description Budget Source Party Date Tool Some strategies break the process down into
tasks that do not yet
a number of separate categories, such as
have a sponsor or
logistics, health care, energy, agri-business,
retail, etc. Other approaches include a much
quicker and simpler process, with the
In our example, a
development of a one-page strategy. This
work task to install
approach can sometimes be used as an
infrastructure for a “shovel ready site” may be assigned to the
interim until a full blown strategy can be developed.
city public works department. Obtaining necessary planning
and zoning approvals would be a task for the city planning
ON LI N E EX A M PLES
department. The city council could be assigned responsibility to
begin city council sponsorship of a TIF district for a future
The following Web pages show examples of recent economic
business using tool making machinery equipment. The
development strategies. Each effort is somewhat different, but
community college could be asked to sponsor a workforce
most of them follow most of the ten items.
retaining effort with the chamber of commerce assigned the
task of developing and implementing a marketing program.
P R E PA R ING A N E CO NO MIC DE VE LO P ME NT STR ATE GY CO NTINU E S ON PAG E 1 0
MAY 2009 | ILLINOIS MUNICIPAL REVIEW | 9