Subscribe

A Publication of WTVP

What is the "jobless recovery?" The phrase itself was actually coined by economist Nick Perna in the last economic recovery of the early 1990s. The situation then was similar to the situation now-the economy showed signs of improvement, but employment numbers showed no corresponding job growth.

At the time this article was written, the February economic indicators had just been released, and the news outlets were streaming with expert commentaries and analyst statements galore. What effect will this jobless recovery have on elections? What do we do about outsourcing? How long will/can the jobless recovery last?

For every economist on the news predicting dire outlooks and pointing menacing fingers at the dangers of outsourcing, there's another expert interpreting the numbers in a different light. Many economists, including Alison Fraser of the Heritage Foundation, recent keynote speaker at the Employers' Association annual meeting, point to an increase in the use of contract employees as one discrepancy that might be skewing the numbers. These employees don't show up on the business payroll survey but would be picked up by the survey of households, which would list them as self-employed.

Others argue the jobs have been coming back-but under the radar screen-in the form of small start-ups.

In economic development terms, these trends are especially significant. The growth in the number of contract employees is indicative of a major shift in workplace trends. From engineers to skilled technicians, contract employment is on the rise in many industries.

The other trend mentioned-the genesis for a shift in the way many analysts propose we measure growth in the new economy-is small business development. The old notion that big box manufacturers are going to fall out of the sky and land in the tri-county area is yesterday's dream. Tomorrow's growth will be achieved through small business development.

In central Illinois, small business development takes place through one of two mechanisms. One is through the facilitation of local business growth. March's announcement regarding the Homeway Homes expansion is a good example of this type of growth. Homeway Homes, a new company affiliated with Schieler & Rassi Quality Builders in Goodfield, is a small, family-owned and -operated company that announced a $5 million expansion project generating 60 jobs initially and up to 150 over the course of five years. This entrepreneur-based business is going to have a tremendous economic impact in the rural area surrounding it-both through direct job generation and the multiplier effect and indirect economic impact.

We've also enabled the facilitation of local business growth through the commercialization of technology developed at the National Center for Agricultural Utilization Research and Caterpillar Inc. into new start-up companies: zuChem and Firefly Energy Inc., respectively.

Small business development also takes place through the attraction of promising start-ups. Today's entrepreneurial businesses often follow the financing and resources they need to fuel operations and the commercialization of new technology.

The creation of the Heartland Capital Network provides central Illinois with a system of funding mechanisms including access to venture capital, angel financing, public investment programs, and traditional private lending. The idea is that different types of development need different types of capital.

Aside from capital, small businesses also need resources and facilitation. Small business development services continue to grow to meet the needs of today's growing businesses. NEXT Steps networking meetings, NOVUS Entrepreneur Network, HITEC and Turner Center services, and the development services of the EDC-all of these services combine to form a winning system of powerful resources for small businesses, whatever their industry.

If a jobless recovery is characterized by overall economic improvement without the traditional corresponding job growth, then perhaps what we should be looking for is non-traditional job growth. The EDC has our sights set for the next level of employment recovery-job growth through small business development and start-ups. Small business growth provides one answer to economic recovery, and the EDC is committed to the small businesses that will drive growth and generate jobs for the future of the Illinois heartland. IBI

Search