story by Roby Brock, a TCW content partner and owner of Talk Business
A new study of the state’s recent efforts to push forward with developing a more diversified knowledge-based workforce shows progress being made but key investments still needed for greater success.
The Battelle study, conducted by the nonprofit Battelle Institute for the Arkansas Research Alliance, highlighted economic gains made since 2008 through a concentrated effort of government and business leaders in Arkansas.
The report noted:
• 135 emerging knowledge economy companies, employing 1,259 workers in Arkansas, have participated in the state’s knowledge-based economy efforts since 2008.
• Knowledge sector workers average over $70,000 a year, more than double the $34,014 average annual wage of the private sector in Arkansas.
• Knowledge-based economy initiatives focused on research have received $61.2 million in state funding from 2008 to 2011 and leveraged an additional $191.8 million in non-state sources to further support their research activities.
• Arkansas’ economy is being bolstered by growth in high-wage, knowledge intensive industries with more than 6,000 direct jobs, which generated a total of 11,800 jobs.
“(Arkansas) has taken the opening kick-off and now has good field position,” said Mitch Horowitz, vice president and managing director of the Battelle Technology Partnership Practice.
The Battelle study suggested that “sustainable funding” – as much as $25 million — was vital for more advancement of knowledge-based jobs and businesses in Arkansas.
Researchers said attaining a higher level of per capita university research funding was crucial and it noted that in 2010 the per capita level of university research funding in Arkansas was $87 compared to $189 for the United States.
Gov. Mike Beebe told a packed conference room of Arkansas CEOs and university officials that he is working on a plan to add more state funding for university research and other recommendations from the study to his FY2014 budget. Beebe noted that he has already proposed $1 million in a line-item for general revenue spending for the initiative, but he would propose an unspecified additional amount from General Improvement Funds (GIF) and possibly other sources.
“I wouldn’t tell you this unless I had a plan. We may have a plan for a substantial portion ,” said Beebe. “I’m not prepared to talk about it now.”
Beebe did say he was having conversations with stakeholders and legislators on the plan and that it wouldn’t cover the total $25 million price tag, but could cover “a substantial portion.”
The Battelle report also said that with greater funding, the state could “accelerate the formation of emerging knowledge-based economy companies” and set a goal to increase 5,000 new jobs in the sector during the next 5 years.
“Achieving success in knowledge-based economic development is complex and challenging but it is imperative for a healthy economy,” said Jeff Gardner, Arkansas Research Alliance board chairman, and CEO and president of Little Rock-based Windstream Corp. “The Battelle study shows us where we are succeeding and demonstrates that strategic funding is essential in moving Arkansas forward.”
The Arkansas Research Alliance, which helped fund the Battelle study, is a 501(c)(3) nonprofit organization governed by a board of trustees comprised of chancellors from Arkansas research universities and CEOs from across the state. In 2007, the Arkansas legislature approved the appropriation of start-up operational funding for the ARA from the state’s general improvement fund.
Link here for the study.