Technology-based economic development, or TBED, is an approach used to help create a climate where deep technology industries, emerging companies and entrepreneurs can thrive. This strategy is a standard, tried and true practice in economic development that can be found in city, state and national economies around the globe.
Investing in technology-based economic development is not just a luxury, but a necessity. For Utah to maintain accolades as one of the top states for business and entrepreneurship, we must innovate. If we fail to do so, other economies will gain a competitive advantage, while we lose out by complacency.
“The economies that are thriving in the United States all have a huge technology aspect to that growth,” said Lieutenant Governor Spencer Cox in a speech last year. “And if we want to have jobs for our kids and our grandkids, a high standard of living and giving people the opportunity to achieve the American dream, we have to be really good in this space…If you’re not innovating, if you’re not playing in this space, it’s really difficult to make a living right now.”
On the municipal level, we have seen Syracuse (drones), Milwaukee (water technologies) and San Diego (life sciences) develop specializations within deep technology industries to provide their economies with a competitive advantage in globally-relevant industries. Meanwhile, programs like Partnership for Regional Innovation Services to Manufacturers initiative (PRISM) in northeast Ohio focus on helping manufacturers in old commodities industries, like steel and automotive, create new technologies and business models to capitalize on opportunities in emerging markets like bio-sciences and clean tech. Countries like South Korea and Israel invest billions in translational research and pre-seed technology companies in the hopes of gaining a competitive edge in industries such as artificial intelligence and precision medicine.
State and other local economy innovation programs like the Utah Science Technology and Research Initiative (USTAR) provide a foundation and building blocks relevant to a robust network of startups in deep technology.
“It’s important for state government to support their local small companies,” said Greg Nielson, president and CEO of Nielson Scientific, a 3D microfabrication technology startup. “There are certain things that private support just can’t provide, like if you’re building something, if you’re trying to do something from physics or chemistry.”
Nielson attributes his ability to build his company in Utah to having a technology-based economic development program like USTAR.
“I have letters of support here from General Electric, from Panasonic, from Xerox, all of which were made possible because of USTAR.”
Additionally, if Utah as a state is not leading in innovative programs that build and ensure Utah has a robust deep technology ecosystem, we face a threat that promising technologies and startups may move elsewhere, meaning our state loses out on opportunities in new industries and technologies.
For example, NewPath Research is an early-stage company located in Salt Lake City that aims to provide new innovative technologies in manufacturing, such as making more advanced tools for semiconductor metrology. Mark Hagmann, the president and CTO of the company, recently noted that other states frequently look to recruit Utah companies to relocate elsewhere.
“Once I got a [federal research and development grant], I got two letters from state offices, one in Kentucky, saying ‘We’ll give you another $100,000 if you bring it to us,” Hagmann said.
Without a strong state commitment to technology-based economic development programs that promote innovation in deep technology, Utah may lose companies like NewPath Research to other states that offer matching grants and other economic development incentives.
However, should Utah take the right steps in technology-based economic development, the state will not only continue to maintain its innovation ecosystem, but emerge as the new model of fostering economic growth in deep technology sectors. Industry and political experts across the state agree that innovation policies are essential for the state’s success.
“Never in human history has the evidence been clearer — economies that invest in science and technology will be on the economic leaderboard of the future…Utah’s long-term prosperity will be fueled by smart investment in science, research and technology,” said Natalie Gochnour, associate dean of the David Eccles School of Business and executive director of the Kem C. Gardner Policy Institute at the University of Utah.
“[Technology-based economic development] efforts should continue, knowing that new opportunities may require further refinements to existing programs,” echoed Pat Jones, former Utah state senator, CEO of Women’s Leadership Institute.
This year will be an exciting time to evaluate current TBED programs like USTAR and build new best practices that ensure Utah remains an innovative leader in technology-based economic development.
“This summer, we [will] take any and all suggestions on a new model to support tech innovation,” said Senator Scott D. Sandall in a Senate Economic Development and Workforce Services Committee.
Business leaders, policy experts and entrepreneurs will also have the opportunity to explore Utah’s innovation ecosystem on Apr. 1 at the Utah Technology Innovation Summit, which will provide an opportunity to explore trends, challenges and opportunities in Utah’s innovation ecosystem.