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Mark Schill: GF’s Prosperity Job 1: Expand ‘productive sectors’

GRAND FORKS — Times are good in Grand Forks. Sales tax collections are up year-over-year, Grand Forks County added jobs at twice the rate of the nation since 2001, and our metropolitan area was first in the nation for per capita personal income growth last year.

This growth has occurred while our economy was dragging two significant economic anchors. For the first part of the decade, our community was exporting a significant amount of disposable income to the federal government in flood recovery loan payments.

And even though the Grand Forks Air Force base remains open, we shed more than 1,200 good-paying military jobs between 2003 and 2011.

I recently ranked the economic performance of the 196 metropolitan areas with fewer than 250,000 people since the year 2000 for Grand Forks placed 35th.

Call it collective cynicism or midwesterners’ self-deprecation, but it is our nature to discount our success. “Who could be living in all of those new apartments?” “If it wasn’t for the oil boom, we wouldn’t be growing at all.”

The oil boom helps, but Grand Forks is growing on its own merits. This is a well-run, fundamentally sound community. High demand is causing housing prices to rise. The region is home to 16 percent more 25- to 29-year-olds than the national average. Our workforce under age 45 is more educated than the nation. In the past year, Grand Forks ranked in the top 15 percent to 20 percent of all 381 metropolitan areas for population growth and net gain from domestic migration. People are moving here.

But the regional economy is at a crossroads. Our metropolitan area has a 30 percent higher-than-average concentration of retail jobs, and we’re also 30 percent above average in hotels, 28 percent above in health care, 7 percent above in construction and 3 percent above in restaurants.

Health care and construction offer better-paying jobs, but these industries largely depend on local consumer activity. They depend on the health of the local economy.

What drives regional growth? It’s the productive primary-sector industries or those that export services or goods. Grand Forks lags the nation in its concentration of nearly all of the critical productive sectors. Our most critical deficiencies are in professional and technical services (58 percent below the nation), business headquarters (78 percent below), finance (45 percent below) and manufacturing (29 percent below).

Grand Forks as a consumer economy makes sense. It is a regional center, a college town and a haven for Canadian shoppers. These are good things and add to the amenities our community offers.

But long-term prosperity for our citizens depends on the productive sectors. This is where the efforts of groups such as the Grand Forks Region Economic Development Corp. are critical. The EDC’s job is to help grow our productive economy. Signs point to this work paying off, with EDC partners growing jobs and wages by 65 percent over the past decade. We should support this work.

Considering the circumstances, our community has done well overall the past 15 years. We weathered the flood and the shrinking of the Air Force base. Those were crisis situations forced upon us, requiring a certain style of leadership. We overcame those challenges.

Navigating our future requires us to shift gears, be more investment-oriented and be more risk-tolerant. Before every future community investment, we should ask ourselves: “What will this project do to improve production?”

Do we want to be a consumer city or a producer city?

Schill is a Grand Forks resident and native and a community strategy consultant with Praxis Strategy Group.