Farmshoring in Virginia

Our Sponsors• Virginia Economic Development Partnership• Alexandria Economic Development Partnership• Arlington County Economic Development• Carroll-Galax-Grayson Regional Industrial Facilities

Authority• Harrisonburg Department of Economic Development• Lake Country Region Marketing Council • Loudoun County Department of Economic Development • Martinsville-Henry Economic Development Corporation• Smyth County Industrial Development Authority

A closer look at outsourcingGeographic

ScopeType Definition

International Near-Shoring AOL call-centers in Canada

Off-Shoring Branch facilities and contracting with businesses in Asia

Domestic Home-Shoring JetBlue’s reservation system

In-Sourcing Federal contractors consulting inside agencies

Off-Sourcing Federal contractors producing off-site

Farmshoring CGI-AMS in Lebanon, Virginia

What sorts of jobs are moving?• No face-to-face contacts with customers

• Information is the major component of the “product”

• Work via remote communications: Telco & Internet

• Low set-up barriers

• Low social networking requirements

• High wage differentials compared to the receiving country• Tasks reducible to a set of instructions with a measurable output

Where did we look?

Washington region industries with outsourcing potential

Other industries with farmshoring potential

Urban-rural linkagesthrough outsourcing

Urban-rural linkages throughinternal capacities & external demand

Exogenous Endogenous- Aerospace- Information technology- Electronics manufacturing- Healthcare information- Biotech / Pharmaceuticals

- Wind power- Specialty agriculture

Domestic outsourcing criteriaSending jurisdictions Receiving jurisdictions

- Industry growth & concentration- Occupations at-risk- Occupational requirements- Cost considerations- Location considerations- Security concerns- Firm-level considerations- Agglomeration- Unmet demand- Match with rural resources- Infrastructure requirements- Local supplier presence

- Cost- Workforce- Infrastructure- Housing stock- Business climate- Geographic location- Demographics- Unique advantages and amenities- Cultural compatibility- Safety and security

Is rural Virginia ready?

Recommendations for the stateStrategy Tactics

Be the matchmaker:Understand community assets and limitations, function as an intermediary, and provide support to all participants.

- Broker linkages between people, communities, and industries- Continue and expand funding for rural broadband initiatives- Grant localities flexibility to act appropriately when the private sector fails to meet infrastructure needs- Support targeted training and targeted recruiting of workers- Assist sending and receiving communities in researching their readiness and suitability for domestic outsourcing

Recommendations for urban areasStrategy Tactics

Focus on efficiencies:Domestic outsourcing is beneficial to your community by helping your industries’ bottom lines through increased efficiencies

- Anticipate outsourcing in your industries by understanding internal dynamics and needs- Help industries realize potential synergies with Virginia communities- Connect with representatives of low-cost regions of Virginia – know what they have to offer

Recommendations for rural areasStrategy Tactics

Be realistic and prepared to work hard:This is not a magic bullet – it is another strategy in your portfolio and will require time and effort to realize

-Short term: Pursue outsourcing opportunities that fit local assets and limitations-Long term: Address local limitations; cultivate additional workforce and infrastructure assets- Consider both the exogenous and endogenous routes to domestic outsourcing- Connect with representatives of sending jurisdictions, possibly through brokered exchanges- Develop plans for retention of outsourced business functions

Our deliverables and outcomes

• Student presentation, technical report

• Faculty finalized summary policy report

• Virginia APA Award• Presentations to

diverse practice and academic audiences

• Scholarly articles• Practitioner issues

roundtable• “Drill-down” projects

Lessons learnedStrategy Tactics

Thought leadership = uniquely situated convener + trusted analytical resource

Learning-Joint course

Discovery-Collaborative research project

Engagement-Unique venue for policy discussion

For more informationHeike Mayer, Ph.D.Assistant ProfessorActing DirectorUrban Affairs and Planning ProgramVirginia Tech - Alexandria Center1021 Prince Street, Suite 200Alexandria, VA 22314Phone: (703) 706-8122E-mail: heikem@vt.eduWeb: http://uap.ncr.vt.edu/people/hmayer.html

John Provo, Ph.D.Senior Economic Development SpecialistOffice of Economic Development (0373)Outreach and International AffairsVirginia Tech702 University City Blvd.Blacksburg, VA 24061Phone: (540) 231-4004E-mail: jprovo@vt.eduWeb: http://www.econdev.vt.edu

Students who participated in the studio: Amit Agarwal, Kael Anderson, Samantha Archibald, Suzie Battista, Christy Blake, Anita Bullock, Mary Ellis, Shana Johnson, Aurash Khawarzad, David Kroeger, Jonathan Logan, Seth Peery, Valerie Peterson, Meghan Shilling, Melissa Tompkins

Graduate students in the Master of Urban and Regional Planning Program at Virginia Tech