The New North From Concept to Reality

The New North: From Concept to Reality

How it Got Started v The Fox Valley WDB – “What’s happening? ” v v The New North Measuring Up Looking Ahead Moving Ahead v Networking Welch & Winters v The Bay Area WDB joins in v The project evolves v The concept of a regional plan emerges

The Plan is Launched! v October 2004 v v The New North Measuring Up Looking Ahead Moving Ahead v Key players/leaders emerge v The Governor speaks

The Keys to the New North v Private sector leadership v v The New North Measuring Up Looking Ahead Moving Ahead v Money v A plan v A professional staff v Buy in

Is the New North plan a success? • Basis 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

Regional Organization and Thinking MI WI MN IA UP/WI Border Region

Measuring Up: What has happened and where are we?

Key Strategies v v The New North Measuring Up Looking Ahead Moving Ahead v. Leverage the regional brand v. Attract, develop and retain diverse talent v. Advance educational attainment v. Target growth opportunities v. Build entrepreneurial climate and small businesses v. Incorporate sustainability

Key Events Since 2004 v v The New North Measuring Up Looking Ahead Moving Ahead v Formation of the New North Inc. v A strategy to work the plan v Hiring a first rate executive director v The economic summits v The branding initiative v Targeted initiatives

Some Leading Edge Thinking and Action v The Wind Energy Cluster v v The New North Measuring Up Looking Ahead Moving Ahead v Sustainability and Green Jobs v Cellulosic Bio. Fuels Studies and Plans

Looking Ahead: The New Normal Economy

Perspective & Attitude Adjustment v v The New North Measuring Up Looking Ahead Moving Ahead v There is and will be bad T economic news for at least six more months. v The most successful Wisconsin industries – paper and dairycame out of economic crisis v Many Wisconsin industries were initial failures - paper

The Last 11 Recessions Duration of U. S. Recessions in Months Dec 07 - ? Mar 01 - Nov 01 Jul 90 - Mar 91 Jul 81 - Nov 82 v v The New North Measuring Up Looking Ahead Moving Ahead Jan 80 - Jul 80 Nov 73 - Mar 75 Dec 69 - Nov 70 Apr 60 - Feb 61 Aug 57 - Apr 58 Jul 53 - May 54 Nov 48 - Oct 49 0 5 10 Source: The National Bureau of Economic Research 15 20 25

What makes this recession different from the last five major recessions? v v The New North Measuring Up Looking Ahead Moving Ahead 1. 28 years since last major downturn 2. First recession experience for 1+ generation(s) 3. The multiple sources of economic trouble & risk 4. The speed and depth of the economic downturn 5. The first major recession in the age of the Internet

U. S. Housing Starts v v The New North Measuring Up Looking Ahead Moving Ahead v v v 2003 2004 2005 2006 2007 2008 1. 4 million 1. 85 million 1. 95 million 2. 07 million 1. 81 million. 95 million v 2009 . 55 million Housing = 4% GDP Normal Replace/ Growth 1. 3 million

U. S. Auto Sales v v The New North Measuring Up Looking Ahead Moving Ahead v v v 2004 2005 2006 2007 2008 2009 (Est. ) 17. 7 million 16. 9 million 17. 0 million 16. 1 million 13. 2 million 9. 9 million Decline: 18% in 2008; 25% in 2009 Autos = 3. 5% of GDP Past declines: 21% in 1974; 19. 1% in 1980

The Global Economy 2008 World Population (Market) v v The New North Measuring Up Looking Ahead Moving Ahead 6. 5 Billion U. S. Population 0. 3 Billion World Economy (GDP) $60. 6 Trillion U. S. Economy $14. 4 Trillion EU Economy $18. 4 Trillion China’s Economy $4. 3 Trillion Source: 2006 Estimates IMF and World Bank

Economic Excess/Overhang v Furloughs and wage freezes and give backs v v The New North Measuring Up Looking Ahead Moving Ahead v v v v v Mercury Marine Milwaukee labor contracts State furloughs Unemployment Housing glut/Housing cycle Consumer deleveraging Consumer savings rate> – to + New financial regulations Generational reality check

The Budget Deficit: A Threat to the Dollar v v The New North Measuring Up Looking Ahead Moving Ahead

So what is the “New Normal”? Consumer: v v The New North Measuring Up Looking Ahead Moving Ahead v Savings Rate v Spending v Work Life v Standard of Living ä æ

So what is the “New Normal”? Business: v v The New North Measuring Up Looking Ahead Moving Ahead v Regulation v Outsourcing v Globalization v Business Cycles ä æ ä ä

Moving Ahead: Where do we go from here?

In the New Normal economy, where is the advantage? v v The New North Measuring Up Looking Ahead Moving Ahead v A back to basics economy v Huge global markets v A versatile workforce v. A Alignment with market opportunities

Key Global Market Demand v v The New North Measuring Up Looking Ahead Moving Ahead v Energy v Fiber v Protein

Some Economic Opportunities v v The New North Measuring Up Looking Ahead Moving Ahead v Waste transformation & technology v Higher education & training v 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

Parting Thoughts v Focus on the plan: Most regions don’t have a strategic plan v v The New North Measuring Up Looking Ahead Moving Ahead v Think globally: The markets increasingly are over there v Position for the next recovery: It will come and those with a good plan will prosper

v David J. Ward, Ph. D. , CEO v Phone: (608) 279 -3393 v Email: dward@northstareconomics. com v Fax: (608) 441 -8064 v Web: www. northstareconomics. com