Penn State researcher testifies on economic development policy

January 23, 2007

Washington, D. C. -- The U.S. government needs to move away from an economic development policy mainly focused on solely job creation to a policy that develops high-skill and high-wage jobs requiring more education and training for its citizens, says a Penn State economic geographer. National energy industries may be an area of growth and opportunity for such economic growth.

Amy Glasmeier, the E. Willard Miller professor of economic geography and planning at Penn State and the John D. Whisman Appalachian scholar, Appalachian Regional Commission, testified Tuesday (Jan. 23) before the U.S. House Transportation and Infrastructure Subcommittee on "Economic Development, Public Buildings and Emergency Management." Her comments focused on the state of economic development emphasizing four issues: the experience of federal efforts to reduce economic distress; the impact of reductions in federal funds for economic development over the last two decades; the challenges facing economic development practice today; and finally, regional development opportunities associated with the search for national energy independence.

"The emphasis on jobs over the last 30 years has brought to rural areas and distressed counties some degree of development," Glasmeier says. "But, technological change, corporate restructuring and global competition are now changing the nature of work in rural America and causing serious problems of displacement in many communities that were the beneficiaries of post-war rural industrialization. Job losses are mounting in communities where low-skill employment has bee dominant. From 1997 through 2003, more than a million and a half rural workers experienced unemployment due to fundamental changes in industries that were targets of recruitment over the last 40 years. The rate of this job loss is up sharply due to automation and supply acquisition from firms operating outside the U.S. In rural America, manufacturing is being hit hard with one in 10 displaced workers formerly employed in labor intensive industries. Looking ahead, the data show that workers with only a high school education, regardless of the industry in which they work, are especially vulnerable.

"Today's economic conditions require an integrative strategy that focuses on both people and place in response to a renewed era of industrial restructuring. Just creating jobs without planning for the skill needs of this new employment generates simply fosters new problems. After a long period of a mismatch between job growth and growing income inequality, the emphasis can and must shift away from a sole emphasis on jobs at any cost to one that recognizes not just the number of jobs but their quality, durability, longevity and developmental potential," she adds.

The full testimony is at www.live.psu.edu/story/21875 online.

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