Let’s all take a deep breath and chant together, “we all love both FedEx and Memphis.”
In the last post, I dared to ask if it was okay to think about life after FedEx, a company that has given many of us jobs, insurance and tuition reimbursement. My intent was not to cast dispersions of any kind toward FedEx. Nor was it intended to diminish the importance of other great employers like AutoZone, International Paper, First Horizon or Graceland.
We must simply realize that reliance on any single industry is unwise. We must recognize that 10% to 20% of our community works in logistics. Many other jobs are directly related. And many of the jobs left (like carpenters & plumbers, lawyers & accountants, dentists & waiters) provide services largely to people working in logistics. I don’t suggest killing the goose that laid the golden egg but if an economic hiccup were to send the logistics industry in a different direction, how would this community handle it?
Also, please note that almost 20,000 young people will be looking for something to do each year for the foreseeable future. If trends hold, some will go to work in fields already prevalent here, the best educated will leave the region, many will not be skilled enough to do either and the cycle of life in Memphis may continue only in a more complicated, expensive and possibly desperate direction.
FedEx and others have funded projects like the FedEx Institute of Technology at the University of Memphis and the business incubator at Emerge Memphis. Pitt Hyde, founder of AutoZone, is one of the chief supporters of advancing bio-sciences in Memphis beyond the known commodity of St. Jude. It is no secret that a more diverse economy would be good and I don’t doubt that our corporate leaders know that. I only ask if we are doing the right things at the right times with the right players and are we doing enough?
Sustainability movement recognizes the importance of business
Santa Monica, California’s Office of Sustainability and Environment promotes diversity as a means to achieve stability. The office has partnered with Housing & Community Development and Public Works to commission the Santa Monica Strategy for a Sustainable Local Economy. The group measures output by business sector and is trying to ensure that no single sector exceeds 25% or any three sectors together exceed 50% of economic activity.
Sustainable Emerald Coast has Environmental Stewardship as only one piece of a four-prong development and growth strategy. This Florida panhandle region has a committee charged specifically with Economic Diversity and Prosperity. They recognize the need to build on aviation, aerospace and defense industries that dominate the area but have created almost 50 economic diversity implementation strategies ranging from basic workforce development to visionary land-use planning to trendy eco-tourism development.
The diversity struggle never ends
Raleigh, North Carolina and its related Research Triangle have been working to diversify its economy for years by strategically courting pharmaceutical and technology companies. They have been so successful that some rating companies are noting stability in the region should be carefully watched because of their dependence on the very high-tech industries they strived for.
New York City, long the symbol of every manner of diversity, has recently struggled with the problem Memphians would love to have… rapidly escalating real estate prices and a waiting list of buyers. But this phenomenon led some to fear that it was creating a streetscape dominated by those in the financial sector at the expense of other industries and the creative class. The U.S. economy may restructure this without much planning but New Yorkers know that their appeal lies in their abundance of options.
Large diversified economies create stability and weather downturns much better than other areas. They create dynamic markets that interest investors with capital. These economies help our governments with tax revenue predictability. Lenders spread their resources through multiple industries with differing cycles and become more willing to fund expansions and start-ups.
Finally, diversity in our business world (like in our cultural make up) could just help us become a more interesting place.
