2023 was a year to remember and celebrate, and NCDS wants to thank all our clients and communities for another excellent year together. 

Economic Development Across the Nation

On a national level, NCDS noted chambers of commerce (CoCs) and economic development organizations (EDOs) facing familiar economic development challenges, yet significantly more pronounced than in previous years. 

While businesses experienced relief from Covid’s supply chain disruptions and a predicted recession that did not materialize, persistent inflation and soaring home values posed new hurdles, complicating population growth, long-term business investments, workforce recruitment, development, and more.

These factors can unsettle economic growth for some and be a boon for others, especially in light of the mass migration from large cities to smaller communities in the last couple years. Communities are now thinking outside the box to discover innovative and untested solutions to these persistent challenges. 

In this dynamic environment, it’s valuable to analyze the recent past and explore the key factors for economic development success in 2024.

Reflecting on 2023:

1. Workforce Challenges Persist 

2023 saw workforce challenges and comprehensive solutions emerge as its predominant theme  across the board. Communities and organizations alike expanded workforce recruitment initiatives to target earlier phases of the career lifecycle, including K-12 education with built-in career paths, technical education, talent attraction, apprenticeships, internships, and childcare, among others.

Communities with higher education institutions also trended toward retaining more graduates, reinforcing their local talent pool. While drawing a causal line from these initiatives to greater results can be difficult across disparate organizations, it’s worth noting that career-driven education and the internship and apprenticeship programs therein seem to offer a valuable geographic anchor to recent graduates. 

2. Innovative Workforce Solutions Continue to Emerge

Beyond the standard initiatives, communities nationwide experiencing extreme workforce deficiencies showed a unique open-mindedness to innovative solutions. Examples include:

• Investmenting in daycare facilities within industrial parks
• Repurposing vacant college dorms to accommodate summer interns
• Beyond traditional job fairs, communities organized events to make themselves more appealing to college students
• Offering relocation assistance to individuals with specific skills or in selected sectors
• Implementing red carpet tours and concierge services to welcome and integrate newcomers
• Career planning, job matching, and job boards
• Mixed use, “lifestyle-driven” developments to attract and house young talent

3. Increased Partnerships and Collaborations Strengthen Community Fabric

The complexity of workforce challenges prompted communities to forge partnerships and collaborations beyond the historical scope of chambers of commerce and economic development organizations (EDOs). New alliances with educational institutions, non-profits, and governmental agencies became more frequent as communities sought holistic solutions to a persistent workforce conundrum.

4. Mixed Implications for Funding

While stakeholders saw value in organizations thinking outside the box, the challenge lay in proving the success and impact of these creative solutions. Not all new ideas are good ideas, leading investors to take a cautious posture when return on investment looks more like a question mark than an exclamation point. 

Even if greenlit, workforce initiatives faced the aforementioned difficulty in showcasing direct causal relationships to their success, adding yet another layer of complexity to funding considerations.

2023 in a Nutshell

2023 struck us as a year of familiar problems to an unfamiliar degree. It’s difficult to remember a “normal” (non-covid) time in our economy when workforce supply and demand took this much innovation to normalize. 

As communities, municipalities, and organizations rely on more creativity to address human resource deficits, they’ll also need to emphasize proving their initiatives yield results to a cautious investor class. 

If your community is exploring new economic development strategies and partnerships, and is looking for a partner to reveal the unknowns, NCDS is always here for consultation. 

Looking Ahead to 2024

The future holds many variables that can make it difficult to predict which fundraising strategies will work, and which won’t. Ideally, your economic development — public, private, or both — has developed a foundation of trust in your community through a series of wins. When citizens think of you, what comes to mind?

We call it “transforming your organization into the place your community’s economic future is planned, directed, and executed.” By achieving this status, you have developed the real capital behind fundraising: trust. Only trust can open the door for new, untested ideas.

It’s easier said than done and takes some time to develop a solid track record of success. Whether you’re there or not, we believe a few key factors will help your organization achieve its goals in 2024: 

1. Winning Strategies: More Than Just New Ideas

The organizations poised for success in 2024 will be those offering creative solutions that are justifiable and measurable in the eyes of investors:

• Establish clear and defensible budget needs to implement your initiatives, especially if untested
• Spend extra time developing and maintaining strong relationships and partnerships that enhance the likelihood of success
• Implement bulletproof methods to "keep score" and monitor progress, demonstrating accountability
• Evolve your stakeholder engagement strategies such that they can visualize programs in action, even when immediate impact metrics may be elusive

2. Balancing Innovative Ideas with Proven, Traditional Methods

Ends don’t always justify the means in economic development, especially when the ends haven’t been proven yet. Traditional investors seek favorable and predictable environments to provide capital, not just excitement for new ideas. 

We recommend chambers and EDOs strike a balance between prioritizing out-of-the box workforce and talent initiatives while maintaining traditional business attraction and retention efforts. From time to time, communities face concerns from investors who worry about sending signals of being "closed for new business" when too much innovation is introduced too quickly. Don’t throw the proverbial baby out with the bathwater; find a balance between new and old that looks like future-focused stability to achieve success.

Find a Trusted Partner

As we move into 2024, the economic development landscape is marked by a commitment to creative problem-solving, collaborative partnerships, and a continuous focus on workforce challenges. Organizations that attentively address these topics with strategic planning and effective communication are poised to lead the way. 

As it stands, most of the growth momentum appears to be in favor of mid-sized cities and their many benefits. If you are looking to capture this momentum and boost the economic growth in your city, get in touch with us today. 

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