2023 Economic Development Outlook: Vicki Pratt

Pratt’s 2023 Projection
Businesses are sitting on cash and hedging their bets regarding that next big capital investment. Plant managers say they’ve got continued production demands, while facing corporate resistance to invest or expand. Businesses are looking at ways to invest in automation and equipment to augment their capacity, especially in light of a prolonged lack of available workers.

What is Springfield and the chamber doing to attract new businesses and industry?
There are thousands of economic development organizations all trying to lure businesses based on their dot on the map. If you’re going to be noticed, you’ve got to do things that are unique and build relationships with decision influencers, site selectors and corporate real estate execs for making that next investment.

We want to make sure we don’t get eliminated or overlooked. We’ve got websites that we push out information on a regular basis. We have a very strong story to tell around food and beverage processing – everything from the consumer brand to the ingredients to the machinery and equipment to the processing for food products. Grow on what you’re already good at. Certainly, some of the big projects that have gotten a lot of attention, like the Amazon project – transportation, warehousing and logistics. If you’ve got an interstate and are in the center of the country, you’re probably competing for those.

Republic, with the Amazon center you mentioned, has experienced a boom in development, largely through chains and retail business. What is Republic doing differently?
It’s that patient capital investing over time. It’s investing in infrastructure. It’s sometimes hard for a municipality to justify making those types of investments without a project already identified. Republic decided early on. Development follows infrastructure: water lines, sewer lines and roads. If those are properly sized and are already there, you stand a much higher likelihood of winning those projects.

What does a successful regional economic development ecosystem look like?
You want rising household income levels over time. We’ve got to make sure there’s continuous growth, that jobs are stable and there are career ladders in the community. Everybody steps onto that ladder at a different place. You’ve got to have the housing that people can afford for whatever rung they step onto that ladder – a good mix for the person coming out of high school taking their first job to attracting health care professionals and C-level people. The ecosystem includes the educational system. The infrastructure has got to be there to support it. The cost of doing business and cost of living in a community is a huge factor as well.

New retail businesses seem to generate much excitement among consumers. From an economic development standpoint, what’s that relationship?
People love quality of life investments. But as a driver to raise household incomes over time, the average wage data from Bureau of Labor Statistics (for a) retail worker in the Springfield (metropolitan statistical area) is roughly $582 a week. Your average worker in manufacturing in the Springfield region is $885 per week. Now, which one of those is going to buy a house? I’m not saying we don’t need retail, but it’s just not a focus. If we keep adding stores, it’s not that we’re selling more groceries; it’s that every grocery store is selling less. Competition is a good thing. But for me in economic development of a 10-county region, focusing on retail is not the best use of my finite resources. We’re trying to focus on those types of investments that are going to create job opportunities that allow household income levels to grow well over time to support new housing and our schools and those things.