(Photo by Flickr user Cam Miller, used under a Creative Commons license)
This story is part of Grow PA, a reported series on economic development across 10 Pennsylvania counties underwritten by the Chamber of Commerce for Greater Philadelphia. Sign up for our weekly curated email here.
A new report from the Brookings Institution suggests Pittsburgh could recreate its heyday of steel, where it was an industry leader, around its current industries of tech and life sciences. But it will require a concerted effort across numerous sectors for the region to realize its potential as a global innovation city.
The city’s Oakland neighborhood has all the pieces to be a central innovation district, the report’s authors found, but needs a strategy to connect its capacity with the larger regional economy.
The report by the Bass Initiative on Innovation and Placemaking at Brookings was presented to an audience of local officials and business leaders at a conference in Pittsburgh last week. It was funded by the Heinz Endowments and the Henry L. Hillman Foundation, and took researchers about 18 months to prepare.
“You were a first mover around steel and that had dramatic multiplier effects across the economy,” said the report’s co-author, Brookings scholar Bruce Katz. “And we’re saying you can do it again.”
The conference was held at the Energy Innovation Center in Pittsburgh’s Hill District neighborhood, one of the most underprivileged areas of the city. Aside from the PPG Paints Arena, where the Penguins play hockey, there is little evidence in that neighborhood of the prosperity going on in other parts of Pittsburgh.
“Pittsburgh’s scientific and technical strengths have not fully translated into broad-based economic activity,” the report states. “In fact, if the region had the same share of high-tech employment as university research, it would employ 9,000 more in the software industry and 5,500 more workers in drug development,” as well as thousands of related jobs. “Instead the city currently has seven percent fewer jobs in high-wage high-tech advanced industries than it did in 2000.”
So how to right the ship, and make the connections between the burgeoning robotics industry and life sciences companies and the larger workforce in Pittsburgh?
The report outlined key steps for Pittsburgh to take.
Build and support Pittsburgh’s innovation clusters in advanced manufacturing, life sciences and autonomous systems.
The research centers and the regional economy could be connected more easily with a “focused technology approach,” the report states. Putting that focus on the robotics, advanced manufacturing, life sciences and autonomous systems sectors makes the most sense and plays to the region’s established strengths.
Pittsburgh Mayor Bill Peduto said at the conference he wants to see the creation of a fund that would be supported by the city, with matching funds from nonprofits and companies, to drive resources into the city’s growing tech sector and startup companies in low-income neighborhoods.
“We would work to fix up neighborhood business districts and help somebody who wants to start their own auto repair shop or their own barbershop to be able to get through those first few years when a company makes it or breaks it,” the mayor said.
Define, grow and connect the Oakland Innovation District. Oakland needs to be more clearly identified and marketed to include an emphasis on investments in Carnegie Mellon University, UPMC and the University of Pittsburgh.
Katz said Pittsburgh doesn’t do a great job selling its strengths to the world.
“This is the way the world thinks about innovation; they don’t think about countries or states or metropolitan areas, or even cities, they think about districts,” he said. “You have that now, and you need to play it out.”
University of Pittsburgh Chancellor Patrick Gallagher said it would take action on all sides to push such an initiative forward. “The universities can’t be in an ivory tower. They have to be embedded in the community.”
Improve the pipeline of high-growth entrepreneurs.
A global accelerator would attract “world-class startups” in the healthcare sector, the report states. Startup capital, or the lack of it, is a big obstacle for Pittsburgh’s young entrepreneurs. But that has to extend beyond just offering funding, Katz said.
“What startups need when they’re coming out of a university or just generally emerging is they need an ecosystem,” Katz said. “They need access to capital, they need access to mentoring. They usually need, like a co-working space; they need a community that basically is supporting them.”
Create a talent alliance within the Oakland Innovation District. Existing workforce development programs should work with employers and educational institutions to examine hard-to-fill jobs and develop training programs for underskilled workers in neighborhoods adjacent to Oakland.
UPMC CEO Jeffery Romoff, who was part of the panel discussion following Katz’s presentation of the report’s findings said UPMC has long practiced, and been criticized for, many of the practices that are “fashionable” in an innovative ecosystem.
“UPMC sees itself as the economic expression of the path forward,” Romoff said. “It views itself as the head of the innovation economy.”
As is the case with most economic development discussions in Pittsburgh of late, the conversation turned to Amazon, and its recent announcement that it plans to build a second headquarters outside of Seattle.
Pittsburgh leaders wasted no time making it clear they planned to lobby hard for Amazon to come here. However, most recognize there’s much work to be done before the city could support a company of that size and the additional 50,000 workers Amazon would house in its so-called HQ2.
Peduto said when he heard the news, he thought about the character of Quint from the movie Jaws.
“This is not like going down to the pond and chasing bluegills and tommycods,” he joked. But with cohesion between its tech sector and its workforce better aligned, the chances of attracting an Amazon are likely stronger.
In the final section of the report that looked to the future, the authors make reference to two Pittsburghs: One driven by university research and tech firms, and a larger one made up of families and workers in the low- and mid-level manufacturing jobs that continue to be a significant part of the Rust Belt workforce.
Unless these two connect, the current progress in Pittsburgh is not guaranteed to continue.
As the city’s population continues to shrink, Pittsburgh needs to act sooner than later to invest in its future, the report concludes. In an ideal future scenario, collaboration across sectors is critical to preventing the city and the region from becoming a “could have been.”
Despite its assets, the report finds, “Pittsburgh’s technological strengths have not yet translated into broad-based economic opportunity or growth.”