The New North: From Concept to Reality

The New North:From Conceptto Reality

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How it Got Started

Networking Welch & Winters

The Bay Area WDB joins in

The project evolves

The Fox Valley WDB – “What’s happening?”

The

The concept of a regional plan emerges

The

The Plan is Launched!

October 2004

Key players/leaders emerge

The Governor speaks

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Private sector leadership

Money

A plan

A professional staff

Buy in

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The Keys to the New North

Is the New North plan a success?

• Basis for forming the New North Economic Partnership and all that followed

• Outside assessment – “We want a plan like the New North plan.”

• Stimulated economic development thinking within the New North region

• Led to other regional plans Centergy, Grow North, UP/Wisconsin Border Region

MN

IA

WI

MI

UP/WI Border Region

Regional Organizationand Thinking

Measuring Up:What has happened and where are we?

Leverage the regional brandAttract, develop and retain

diverse talentAdvance educational attainmentTarget growth opportunitiesBuild entrepreneurial climate

and small businessesIncorporate sustainability

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Key Strategies

Formation of the New North Inc. A strategy to work the plan Hiring a first rate executive

director The economic summits The branding initiative Targeted initiatives

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Key Events Since 2004

Some Leading EdgeThinking and Action

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The Wind Energy Cluster

Cellulosic Bio-Fuels Studies and Plans

Sustainability and Green Jobs

Looking Ahead:The New Normal Economy

Perspective &Attitude Adjustment

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There is and will be bad economic news for at least six more months.

The most successful Wisconsin industries – paper and dairy- came out of economic crisis

Many Wisconsin industries were initial failures - paper

T

Source: The National Bureau of Economic Research

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The Last 11 Recessions

What makes this recession different from the last five

major recessions?1. 28 years since last major downturn2. First recession experience for

1+ generation(s)3. The multiple sources of economic trouble &

risk4. The speed and depth of the economic

downturn5. The first major recession in

the age of the Internet

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2003 1.4 million 2004 1.85 million 2005 1.95 million 2006 2.07 million 2007 1.81 million 2008 .95 million

2009 .55 million

Housing = 4% GDPNormal Replace/Growth 1.3 million

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U.S. Housing Starts

2004 17.7 million 2005 16.9 million 2006 17.0 million 2007 16.1 million 2008 13.2 million 2009 (Est.) 9.9

millionDecline: 18% in 2008; 25% in 2009Autos = 3.5% of GDPPast declines: 21% in 1974;19.1% in 1980

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U.S. Auto Sales

The GlobalEconomy 2008

World Population (Market) 6.5 Billion

World Economy (GDP) $60.6 Trillion

U.S. Population 0.3 Billion

U.S. Economy $14.4 Trillion

EU Economy $18.4 Trillion

China’s Economy $4.3 Trillion

Source: 2006 Estimates IMF and World Bank

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Furloughs and wage freezes and give backs

Mercury Marine Milwaukee labor contracts State furloughs

Unemployment Housing glut/Housing cycle Consumer deleveraging Consumer savings rate> – to + New financial regulations Generational reality check

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Economic Excess/Overhang

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The Budget Deficit:A Threat to the Dollar

So what is the“New Normal”?

Savings Rate Spending Work Life Standard of Living

Consumer:

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Regulation Outsourcing Globalization Business Cycles

Business:

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So what is the“New Normal”?

Moving Ahead: Where do we gofrom here?

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In the New Normal economy, where is

the advantage?

A back to basics economy Huge global markets A versatile workforce Alignment with market

opportunities

A

Energy Fiber Protein

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Key Global Market Demand

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Some Economic Opportunities

Waste transformation & technology

Higher education & training International direct investment

Why waste transformation?

• New North is full of waste producers – meat packing, paper, dairy farms and processors, etc

• Waste transformation is green • Academic and private sector research

assets• Some proven models & pilots e.g.

Encap• The world’s largest fresh water clean

up project.

Higher Education and Workforce Training

• Large markets – global markets• UW, private colleges, proprietary,

and WTCS assets• Private sector training programs• Good paying jobs• Students as “educational tourists”

Foreign Direct Investment

• The record of foreign direct investment in the New North

• A different investing perspective and timeline

• An interest in R&D – Fincantieri, Kikkoman, Roche

• UW Task Force on International Investment

Focus on the plan: Most regions don’t have a strategic plan

Think globally: The markets increasingly are over there

Position for the next recovery: It will come and those with a good plan will prosper

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Parting Thoughts

David J. Ward, Ph.D., CEO

Phone: (608) 279-3393

Email: dward@northstareconomics.com

Fax: (608) 441-8064

Web: www.northstareconomics.com