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By Andrew McLauchlin, Director, CGI Initiative for Collaborative Government
October 7, 2009
One of the questions bubbling among federal, state, and local government leaders and observers interested in the American Recovery and Reinvestment Act is: How can we sustain jobs over the long term after the stimulus money runs out?
One approach these leaders can consider is to invest in high-quality jobs in the communities that most need them. An example already under way is the creation of information technology centers of excellence in rural and disadvantaged regions. In a 2008 research report “Creating Jobs in America: Case Studies in Local Economic Development.” published by the CGI Initiative, George Mason University’s Dr. Darrene Hackler describes two examples of this approach in Russell County, Va., and Northeast Pennsylvania.
In another 2008 report the CGI Initiative published, Dr. Lester Salamon, Director of the Center for Civil Society Studies at Johns Hopkins University, recommended expanding on this model. He advocated “the creation of a National Technology Initiative to promote the development of skilled, technology-oriented jobs in disadvantaged American communities.” His recommendation was based on the need to build up U.S. information technology expertise as a matter of national security, as well as the imperative to create high-quality U.S. jobs.
To address this challenge, Dr. Salamon called for the creation of “at least a dozen economically competitive centers of information technology in disadvantaged rural and urban areas of the United States over the next 10 years, with similar objectives possible in other technology areas.”
Only weeks after the release of these two reports, the American economy entered a serious decline. Subsequently, in February 2009, the Recovery Act became law. Among its many areas of targeted stimulus, the Recovery Act includes billions of dollars to expand broadband connectivity across the United States and to train American workers for 21st century jobs. The Recovery Act investments in broadband put immediate force behind a recommendation by Dr. Salamon to close what he termed “the infrastructure gap.”
“To be economically competitive with overseas sites, new information technology locations in the United States will likely need to be developed in historically underdeveloped rural and central city areas, where wage levels even for technology-related jobs are typically 20–30% lower than in IT hot spots like California’s Silicon Valley,” Dr. Salamon wrote.
“These areas often lack the infrastructure of broadband connectivity needed to support modern IT businesses. A critical prerequisite for the kind of National Technology Initiative proposed here will, therefore, be to upgrade the technology infrastructure in these areas much as the Rural Electrification Administration did in electrifying rural America for modern agricultural production 70 years ago.”
At a time when communities are wrestling with how to spark and sustain economic growth beyond the Recovery Act, federal, state, and local leaders could do well to expand investment and leverage of IT centers in rural and disadvantaged regions. These centers not only have the ability to create jobs today, but also have high potential for long-term job sustainability.
For example, an IT center might first build up a state’s health IT capacity to help reduce health care costs and reduce inefficiencies as part of Recovery Act or health reform initiatives. In following years, that same IT center can provide additional software development and services to clients in the region, as well as to other organizations around the country, depending on where the demand for IT services is high. As a result, IT centers not only create jobs locally, they make those jobs sustainable by serving clients nationwide.
As localities look to apply grants provided either by the Recovery Act or the fiscal 2010 and 2011 budgets, and as federal policymakers and program officials consider creation and implementation of new initiatives (e.g., investments in new energy and green technologies), the IT center of excellence approach is a very viable option for achieving high-quality U.S. job creation, economic development, and improved citizen services. Local leaders also can look for ways to expand existing rural technology centers of excellence to create additional jobs at those centers, and add more jobs via new technology centers in other disadvantaged areas.
By investing taxpayer dollars in IT centers, governments can get a long-term and extended bounce from Recovery Act and future program investments, implement information systems they very much need to execute their missions, and build up America’s technology capacity to enhance national security in the process.
Disclaimer: The postings on this site are the opinions of the individual author, and do not necessarily represent CGI’s strategies, views, or opinions. CGI expressly disclaims all liability for actions taken or not taken based on the content of this blog.
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