Collins on jobs: STEM is the key
Urges shift away from distribution
Memphis has branded itself “America’s distribution center” for decades, building on its natural assets and the wild success of global shipper FedEx to attract new jobs.
But Memphis’ warehouses are aging, and in July, 44,000 of its residents were out of work and only about 20,000 jobs were available. Even more troubling, fewer than 600 of those available jobs required a degree, City Council member and mayoral candidate Harold Collins said.
As he runs over the numbers, sitting in the bare conference room of his Whitehaven headquarters, Collins looks exasperated. He sees young professionals — including his own children — thinking about leaving Memphis for greener pastures and wants to stop the bleeding.
Collins has articulated a provocative solution on the campaign trail: Shift the focus of the city and county’s economic de-
velopment agencies from recruiting transportation and logistics companies to chasing companies that create high-paying, highskill science, technology, engineering and math jobs — STEM, for short.
“The world is different now,” he said. “And so you have all of these college kids, high school graduates who are living in Memphis, who want to go home, who go to school. And we encourage them, ‘Go get your college degree, do what you need to do. Come back home and there will be a place for you.’ But the reality is, there isn’t one.”
Collins has latched onto a problem with which many cities across the nation are wrestling. But is a change in the “philosophy” and “mantra” of the Greater Memphis Chamber and the Economic Development Growth Engine really the answer? Not according to local and regional economic development experts, who said Collins’ proposed solution misses the point.
Interviews with local, regional and national experts and officials showed a consensus: Memphis needs STEM jobs.
“Everybody wants that,” said Mike Randle, publisher of regional economic development magazine Southern Business & Development.
In an October 2014 report, the Tennessee Department of Labor and Workforce Development said the state will experience “robust growth” of STEM jobs, and is expected to add 43,000 of the jobs between 2012 and 2022, bringing the total to 295,000.
STEM jobs are expected to grow at a rate of 1.6 percent during that time, compared to the expected average job creation rate of 1.2 percent.
That growth rate is even better for STEM jobs related to health care (2 percent), where Memphis has a head start thanks to nationally known institutions such as St. Jude Children’s Research Hospital.
Going after STEM jobs has another advantage: They pay a median salary of $63,000 in Tennessee, according to the state report. That’s more than double the median salary of $31,000 for all occupations.
But Collins differs with incumbent Mayor A C Wharton — and the experts — on how to pursue STEM jobs.
Mike Mullis, who owns site selection consulting company J.M. Mullis in Memphis, said transportation and logistics are in the top three most-desired industries “everywhere.”
“You don’t shift your emphasis,” he said matterof-factly.
Instead, Mullis said, the city should do what it’s doing already: Focus on building workforce development programs to meet the future STEM needs of the metro, while taking the economic development it can get.
Economic development isn’t a zero-sum game, he added. In most cases, prospects approach city agencies, so it’s not like the city chooses distribution over STEM jobs.
But in those other cases, Greater Memphis Chamber CEO Phil Trenary said, the shift in recruitment strategy happened a year and a half ago. Traditionally, 75 percent of Memphis’ economic development projects have been in logistics and distribution and 25 percent in other areas. But today, he said, that’s been reversed.
The city is currently pursuing 30 prospects, and all but three would create jobs with an average salary of more than $30,000, Trenary said.
The biggest challenge to job creation in Memphis isn’t recruitment strategy, he said. The No. 1 complaint from companies looking to grow in Memphis is that it doesn’t have a qualified workforce.
“We have to make that shift from the misperception that Memphis has workforce issues,” he said.
“We’re not facing issues our peer cities don’t face,” he added.
The city, while Wharton has been mayor, launched workforce initiatives to make itself more attractive for STEM jobs. The flagship program is the recently launched Greater Memphis Alliance for a Competitive Workforce, which was created to craft local education programs to meet employers’ needs.
The program should pay huge dividends in 10 years or so, and sets Memphis apart as a national leader in workforce development, Randle said.
“You don’t change the market,” he said, striking at the heart of Collins’ plan. “You change to the market.”
Giving a boots-onthe-ground perspective, Steve Guinn, who runs the Memphis branch of real estate firm Highwoods Properties and specializes in office real estate, said workforce issues are the main reason more and higher-paying office jobs aren’t being created in Memphis.
“I mean, it’s great to go after high-paying jobs, but you need the people,” he said.