The country is stuck in a liquidity paralysis. The Tea Party's debt exorcisers are pushing their case too hard at the wrong time. President Obama continues to have a big challenge to get the country moving again.
Yet there may be hope at the state and local level. The stimulus was not as effective as hoped, in part because state and local officials were expected to move faster than they were able. However, state and local officials and local entrepreneurs are now responding to the need for new jobs in interesting ways.
For example, last week New York City Mayor Bloomberg visited the Entrepreneur Space in Queens, New York. With him were and Rep. Carolyn Maloney (former Chair of the Joint Economic Committee of Congress) and other locally elected officials. The main stories were in the Queens Gazette or on the Mayor's website.
This visit deserves national attention at a time when job creation is Job 1. Bloomberg knows a thing or two about how to create jobs. Back in 1981, when incubators were few and the Fed had whipped up a severe inflation-fighting recession, Michael Bloomberg started to parlay his $10 million Salamon Brothers severance and shares into a giant company. Last I checked, Bloomberg L.P., still headquartered in New York, as of April 2011 employs more than 13,000 people in 166 locations around the world. Also, by bringing more transparency to capital markets, the company argues with some basis that it has contributed to growth of jobs outside of New York (though more transparency did not offset the meltdown in the nation's financial regulatory system).
Mr. Bloomberg's skill at building a business empire from scratch inspired scared New Yorkers to vote for him after 9/11. NYC elected an entrepreneur as mayor with the expectation that a successful business leader would surely would help the city hold on to its jobs and create new ones.
What the mayor is doing now, ten years after 9/11, is recognizing the importance of entrepreneurs and the fact that few of them have the capital and training he began with 30 years ago. To assist NYC's new entrepreneurs, in 2009 Mayor Bloomberg launched nine business incubators thoughout NYC, hosting more than 500 start-up businesses and more than 800 jobs. The incubatees have raised $39 million in private capital so far. Many are graduating from their incubators.
The city's tech startups, concentrated in Chelsea and Union Square, are getting serious attention from venture capitalists.In 2010, data from both Thomson Reuters and Dow Jones show New York City with substantially more VC deals than Boston, making NYC second only to the Bay Area. The hot areas for VC funding are web-focused tech companies. Just as demand from Wall Street drove growth of NYC's tech companies in the 1990s, today the driver, says Dave Broadwin of Foley Hoag, is the advertising industry.
Green startups are also popping up all over the city, in the areas of organic produce, provenance-tracking food vendors, energy-efficiency programs and alternative-energy options. Green Spaces, a green incubator that started in Brooklyn, has cloned itself in Manhattan. It is now exporting its incubator skills, backing the Green Route Festival this Saturday in Denver.
The Entrepreneur Space in Queens is a good example of an incubator that incorporates these trends. It is pioneering in shared spaces, allowing local food-oriented companies access to the technology of commercial-grade kitchens for a fee. It provides four such kitchens, meeting Health Department standards and operating 24 hours-a-day for the use of 120 local businesses. The companies produce organic dog biscuits, ethnic foods and a variety of pies, cakes and cookies. The kitchens are also used by catering services. The public-private Entrepreneur Space partnership includes incubator services funded by New York City in the form of low-cost workstations, mentoring programs and job training.
Excerpts from comments by the Mayor and Rep. Maloney follow:
When we launched the first business incubator in 2009 to make it easier for entrepreneurs to turn their ideas into local businesses and jobs, we pledged to open more if it was successful. Now, we're identifying opportunities to expand the program even further. We want New York City to be the most welcoming city in the country for people who want to start a business.
I agree wholeheartedly with President Obama that Congress needs to get moving to support job creation: We need to reauthorize the cut in payroll taxes we approved in the last Congress. I'd like to commend Mayor Bloomberg on the success of New York's business incubators. This kind of innovation is one of the reasons New York is doing better than the national average.
Congratulations to the mayor and the other officials working on the incubators. Local efforts do not replace an effective and timely national jobs program. However, whatever NYC can do to encourage entrepreneurship in tech development, sustainable living and any other promising industry is a valuable contribution towards solving the job shortage and an example for other cities and states!