2025 – Building a Resilient Economy in Your Region

What’s on deck for 2025? While short-term recession fears for the United States have abated, local, and regional economic development continue to face alternating  challenges and opportunities.  Adopting a thoughtful, well-rounded economic development strategy can build resilience and growth in our  economies.

What does that look like? To build and sustain a competitive, attractive and dynamic regional economy, consider three strategic areas of focus : business retention and expansion, business attraction, and a strong focus on enabling and fostering entrepreneurship. While they all fit together, they each require their own set of development tactics.

Business retention and expansion – This may seem obvious, but it’s sometimes neglected in certain  regions, much to the peril of sustained economic prosperity and stability. Business retention and expansion – often called BR&E – represents a critically important, relationship-building, after-the-sale strategic effort.

After they’re established in a region, many executives put their heads down to sustain and grow their businesses or organizations. Sustaining a BRE initiative helps local and regional executives stay in touch with new and emerging opportunities in the region, and also provides a critical pipeline of information for economic development professionals and elected officials.

As a long-time professional in economic development, I have sometimes seen established businesses in a community inadvertently receive the short-end of attention and support. That’s not to say  local businesses are deliberately neglected, but the fact remains  it is easy to get caught up in the pursuit of  going after new businesses in a region. In the highly competitive world of economic development, unintended neglect can quietly erode a critical relationship and send a wrong message.

Established businesses with steady employment represent the bedrock of any economic development strategy. Local and regional economic development professionals can build on this by helping established businesses identify financial incentives, potential tax relief, needed infrastructure upgrades, and important workforce development and training options.

Making key visits and contacts with area executives to listen to and research their needs and challenges can yield a whole host of benefits.  It also builds reputation and brand for a community  as one who cares about business relationships and is willing to go the extra mile to create expansion opportunities for an existing company.

Business attraction – Because it’s generally a high-profile activity, business attraction often is the most publicly visible element of economic development outreach, and rightly so. Attracting new companies to move to a region to foster growth represents a key attribute of a successful strategy.

Brand development and marketing figure high in business attraction, as the region needs to have a believable reputation as a desirable place to do business. A standout brand directly helps position a region positively in an intensely competitive environment.

High-growth opportunities need to match, and relocation executives made aware of how assets in a region or county can align with business operations. Business relocation represents a costly and often challenging solution for a company, so the benefits need to clearly outweigh the myriad costs and barriers. Companies and their representatives (e.g. site selection professionals) must clearly understand and appreciate the potential benefits of bringing their operations to a new location.

These mean that key advantages of local workforce, education and retraining resources, affordable and available healthcare, natural resources like water, high-speed reliable broadband, a pro-business environment, manageable regulatory issues, and an established high quality of life must be appropriately well-positioned in the portfolio of opportunities available to a new business. Such decisions generally are not snap judgments, so marketing and targeted communications need to be strategic and ongoing. It’s no accident that positive media relations about a region typically score high in the decision tree for relocation or expansion.

Marketing is just one element of business attraction. Economic development professionals must partner with local and regional officials to ensure that attractive infrastructure, incentives, and other improvements for transportation and power match and are available – or least well into planning stages.

Entrepreneurship and growing your own – all effective economic development programs should include a focus on encouraging and supporting entrepreneurship, also known as economic gardening. Small business produces more direct job growth than any other sector in the American economy. Supporting entrepreneurship means helping small startups scale their operations and grow, and these companies tend to remain in the communities in which they launched.

This means working to provide support in learning about business management, financial issues like margins and investments, workforce training, tax management, and other critical issues.  Knox County is strategically aligned with outstanding economic partners, such as Vincennes University, which offers  important educational assets and talent that can partner with entrepreneurs. We  are  also most fortunate to have The Pantheon, a successful business innovation incubator and accelerator,  offering  coworking space for startups and those considering a new business.

Giving entrepreneurs an opportunity to establish and build a local successful business also counters the trend of “brain drain,” where graduates and young adult professionals migrate away from a local area. This is especially an issue in rural areas.

The key point? By planning, developing, and appropriately engaging in these three strategies – business retention and expansion, business attraction, and entrepreneurial support – local areas and regions can redefine and energize economic success . Such a balanced approach builds a truly resilient local economy. The fact remains that people – and companies – like winning.  Economic development professionals who successfully partner with local and regional officials to build an environment where people thrive score more wins and advance their regions.

Thoughtful planning and sustained execution can build a lasting legacy and a vibrant community capable of not only surviving but thriving.

By Chris Pfaff

A long-time economic development and defense industry professional, Chris Pfaff is Chief Executive Officer of Knox County Indiana Economic Development.

(The above was also published on Inside Indiana Business.)

More information: Michael Snyder, MEK