EasternRegional Competitiveness

Forum

Atlanta - June 6 & 7, 2002

National GovernorsNational GovernorsAssociationAssociation

Clusters in Rural America

Don Macke

U.S.Forest Service

ILLINOIS

IDAHO

NORTH CAROLINA

OHIO

ARKANSAS

NEW HAMPSHIRE

WEST VIRGINIA

MISSOURI

MONTANA

MINNESOTAMAINE

NEBRASKA

NEVADA

TEXAS

NEW MEXICO

ARIZONA

COLORADO

WYOMING

UTAH

IOWA

OKLAHOMA

KANSAS KENTUCKY

WASHINGTON

NORTH DAKOTA

LOUISIANA

MISSISSIPPI

OREGON

MICHIGAN

MARYLAND

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Entrepreneurship & Rural America

Importance of Entrepreneurs

Pursues Opportunity Lives Proactively Leverages Resources Builds Networks Creates Value

GEM 2000: Entrepreneurship is strongly associated

with economic growth!

The level of entrepreneurial activity explains 70 percent of the difference in economic growth among nations.

All nations with high levels of entrepreneurial activity have above average rates of economic growth.

Only a few nations that have above average rates of economic growth have low levels of entrepreneurship.

NCOE Report:

High-growth companies are truly extraordinary in the economy; fewer than one in twenty U.S. businesses achieve high-growth rates.

High-growth companies are found in all regions of the country, often concentrated in the most surprising areas.

Most fast-growing, entrepreneurial companies are not in “high-tech” industries.

Most regions’ high-growth companies concentrate in certain specific industry sectors.

MICHIGAN

NORTH CAROLINA

OREGON

MISSISSIPPI

KENTUCKY

NEBRASKA

MAINE

WEST VIRGINIA

High Performing ESOs

Mini-Wrapup:

Entrepreneurs are Important EGCs are Critical ESOs make the Difference

Our Position. . ..

Weaker Rural Economic Performance is Due in Part to Lower Levels of

Entrepreneurial Activity?

Rural Challenges:

People are Entrepreneurial Fewer Entrepreneurs Far Fewer EGCs Inconsistent ESOs Dominance of Extractive Industries

GEM-Trends Entrepreneurs are Powerful Economic Drivers

Entrepreneurship Rates by Industry Grouping. . .

Extractive 4%

Transforming 30%

Business 21%

Consumer 45%

Opportunity:

Energizing

Rural Entrepreneurs

How?

Clusters & Energizing Rural Entrepreneurs

Why Clusters?

Many reasons It is a remarkably convenient way to organize

the rural landscape. Matches state’s sectoral approaches.

Rural Reality:

SectorPlace

Rural America’s Economy

Support

Activities

Natural

Resource

Industries

Processing

Industries

Elderly

& Retirees

America’s Playground

Corridor Industries

Government

Prisons Military Bases Federal Lands Indian Reservations Waste Sites

Health Care Housing Services Retail

Telecom

Highways Railroads

Second Homes Tourism Recreation

Forestry Mining Energy Agriculture Fisheries Waste

Resource Processing

Manufacturing

Retirement Homes

Rural Reality:

Increase in Primary Industry Output Decrease in Massive Restructuring Decrease in Secondary Industry Output

Central Nevada Story

U.S. Forest Service Center for Economic Development,

University of Nevada at Reno KCEL RUPRI Area Develop Interests

Central Nevada

EurekaLander

Layered Analysis:

1. Area’s Economic Clusters

2. Entrepreneurs within Clusters

3. GAP Analysis

4. Opportunity Identification

OpportunityKnowledge

Energizes Area

Entrepreneurs

Increased DealFlow

Cycle of Development

Central Nevada Clusters

M in in g

A lfa lfa H a y T ra n sp .

S erv ices

A rtisa n C ra fts L o ca l

S erv ices

G o v ern m en t O th er R etirem en t

Entrepreneurs:

Identify Them Focus on Them Customized Support Connect Them

Other Mini-Cluster Examples. . . .

NE - Niobrara Valley Delta - Recreational Tourism 4 Corners - Forest Products MI - Light Manufacturing ME - Furniture Making AZ - Retirement

Policy Considerations . . . .

Area Strategies Entrepreneurial Focus Mini-Cluster Focus Build & Support ESOs Public/Private Partnerships

For More Information. . . .

Center for Rural Entrepreneurship – http://www.ruraleship.org

Kauffman Center – http://www.entreworld.org

RUPRI - http://www.rupri.org