ECONOMIC ANALYSIS OF KEY PRESIDENTIAL ELECTION ISSUES: THE COLUMBUS REGION ECONOMIC PERSPECTIVE Jung Kim | Columbus 2020 3 October 2016
ABOUT COLUMBUS 2020 Economic development organization for the 11-county Columbus Region Network of public and private sector partners Launched in 2010 to strengthen and diversify economic base: Build existing assets Attract new investment Create new business opportunities Continually improve Region as a business location
U.S. EXPORTS, 1960-2015 2,500,000 U.S. companies exported $2.2 trillion in goods and 2,000,000 services in 2015, down slightly from the past two years but still 1,500,000 far above historical levels $ million 1,000,000 500,000 0 1960 1962 1964 1966 1968 1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 Source: Census Bureau
U.S. NET FOREIGN DIRECT INVESTMENT 400,000 In 2015, the U.S. reached 350,000 record levels of FDI ($348bn) 300,000 250,000 $ million 200,000 150,000 100,000 50,000 0 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source: Bureau of Economic Analysis Note: Net FDI equals greenfield investment and acquisitions minus closures and dispositions back to domestic ownership.
COLUMBUS REGION EXPORTS Columbus Region export value (2015 USD) Goods Services 12,000 Columbus Region exports grew 56% 10,000 from $6.9bn in 8,000 2003 to $10.7bn in $ million 2015. 6,000 4,000 Services’ share of 2,000 exports rose from 30% to 41%. 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source: Brookings Institution
COLUMBUS REGION EXPORTS Columbus Region jobs supported by export activity 80,000 Export-supported 70,000 jobs in the 60,000 Columbus Region 50,000 grew 30% from 40,000 2003 to 2015, 30,000 compared to 9% overall job growth. 20,000 10,000 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source: Brookings Institution
COLUMBUS REGION EXPORTS Top 10 industries by export sales ($M) Transportation Equipment 2,269 993 Financial Services Chemical Manufacturing 867 Machinery Manufacturing 833 Travel & Tourism 673 Royalties 567 Tech Sector 520 Food Manufacturing 404 Freight & Heavy Industry 382 362 Electrical Equipment & Appliances Source: Brookings Institution
COLUMBUS REGION INDUSTRIES AND TPP Agriculture: Meat and soybean exporters in particular will benefit from reduced foreign tariffs. IT, Finance, Professional Services: More clarity for service (“knowledge industry”) exports, including short- term business visits. Apparel: Neutral to positive for U.S. retail brands and production source countries (e.g. Vietnam). Automotive: Reduction of NAFTA regional value content may provide more flexibility for OEMs but affect suppliers.
COLUMBUS REGION FDI Columbus Region firms by foreign HQ country Japan 130 The Columbus Region United Kingdom 53 has 451 foreign- owned firms that 51 Canada employ >60,000 Germany 41 workers. France 28 Switzerland 27 Japanese-owned Other Europe 69 firms employ >25,000 Other Asia 24 workers. 28 Other Source: Columbus 2020
COLUMBUS REGION FDI Columbus 2020 attraction projects pipeline International Domestic International projects comprise 80% about half of our active 70% attraction projects. 60% 50% 74% of FDI projects 40% announced from 2011 to 2016 30% YTD (August) are 20% manufacturing or science/ 10% technology , versus 45% of 0% Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 domestic projects. Source: Columbus 2020
COLUMBUS REGION FDI Employment by entry year of foreign-owned establishment 50,000 From 1991 to 2011, M&A 40,000 represented 58% of the Columbus Region’s 30,000 employment growth in 20,000 foreign-owned firms 10,000 - Source: Brookings Institution Columbus-based pharma acquired as Columbus-based company acquired in pure generic play in 1978. Now ~1,200 1980s and consolidated with 6 other employees in Columbus Region. U.S. acquisitions. Now a major 3PL HQ with ~2,000 employees in Region.
A VALUE CHAIN PERSPECTIVE ON TRADE AND INVESTMENT Automotive Apparel Parts can cross national borders Imports support thousands of within and outside NAFTA multiple HQ, office, IT and logistics times for cars assembled here or jobs in the Columbus Region elsewhere
A VALUE CHAIN PERSPECTIVE ON TRADE AND INVESTMENT Auto parts manufacturing value added per worker Ohio $134,235 México (nation) $21,362 Chihuahua $18,972 Coahuila $19,120 Guanajuato $22,682 Jalisco $20,722 México (state) $24,519 Nuevo León $27,481 Querétaro $18,671 San Luis Potosí $19,110 Sources: 2013 data from the U.S. Census Bureau, 2013 Annual Survey of Manufactures and Instituto Nacional de Estadística y Geografía, Censos Económicos 2014
A VALUE CHAIN PERSPECTIVE ON TRADE AND INVESTMENT Multinational manufacturing companies hire an extra 250 U.S. workers for every 100 employees they bring on in Mexico. (Source: Peterson Institute) Automation manager at Wisconsin plant who started career at $5.50/hour: “The robots do my [old] job, and I am managing people that manage them.” http://www.latimes.com/projects/la-fi-manufacturing- boom-mexico/#nt=oft07a-3gp1
IMMIGRATION IN COLUMBUS Age by nativity, Columbus MSA Under 5 years 5 to 17 years 18 to 24 years 25 to 44 years 45 to 54 years 55 to 64 years 65 to 74 years 75 years and over U.S.-born 63% of foreign-born residents in the Columbus metro are of prime working age (age 25 to 54), compared to 41% of their U.S. born counterparts Foreign-born Source: Census Bureau, American Community Survey 2015
IMMIGRATION IN COLUMBUS Entrepreneurship Immigrants represent 10.5% of Columbus metro business owners, versus 7.7% of the population. >40% of Fortune 500 companies were founded by immigrants or the children of immigrants (Partnership for a New American Economy). 51% of unicorn startups (>$1 billion valuation) had at least one immigrant founder (National Foundation for American Policy).
IMMIGRATION IN COLUMBUS Income range by nativity Educational attainment by nativity, adults age 25+ U.S.-born Foreign-born U.S.-born Foreign-born 30% 30% 25% 25% 20% 20% 15% 15% 10% 10% 5% 5% 0% 0% <$25K $25-35K $35-50K >$50K Less than High school Some college Bachelor's Graduate or high school graduate or associate's degree professional graduate (includes degree degree equivalency) Source: Census Bureau, American Community Survey 2015
IMMIGRATION IN COLUMBUS Poverty rate by nativity, year of entry into U.S. 35% 31% 30% 24% 25% 22% 20% 14% 14% 15% 10% 5% 0% U.S.-born All Entered U.S. Entered U.S. Entered U.S. 2010 or later 2000 to 2009 before 2000 Foreign-born Source: Census Bureau, American Community Survey 2015
THANK YOU Columbus 2020 150 S. Front St., Suite 200 Columbus, OH 43215 columbusregion.com | 614-225-6063
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