Governor's group to study states' economies

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July 26, 2011 - 7:00pm

Governor Dave Heineman says it's clear what's most important in states across the country right now. "Job creation is the number one issue in America," he declares.


That's why Heineman, in his new role as chairman of the National Governors Association, has chosen "Growing State Economies" as his focus for the coming year. "Economic development is one of my top priorities," Heineman says. "We've developed an initiative that will help states target and refine their economic strategies to help create jobs."


PHOTOS

photo courtesy Gov. Dave Heineman's office

Nebraska Gov. Dave Heineman has taken over from Washington Gov. Christine Gregoire as chair of the National Governors Association.


Photo by Fred Knapp, NET News

Ian Anderson, foreground, with back to camera, and Allie Harman, right, work in Hudl's sales area.


Photo by Fred Knapp, NET News

Hudl CEO David Graff helped found a company that's grown to 41 employees in five years.

But how much of a difference do state policies really make? Heineman says Nebraska's economy shows they matter. Citing Nebraska's 4.1 percent unemployment rate, second-lowest in the country, he declares "Governors are in a position to lead, and make a difference." (For unemployment rates by state, click here)


Heineman says it's important for states to encourage so-called "gazelles" - new, fast-growing firms that can fuel job growth.


About a mile from the Capitol, in downtown Lincoln's old Haymarket District, one of those gazelles is up and running. It's a company called Hudl.

Hudl helps sports coaches around the country by doing things like putting their game videos online. That lets players study them at home, without coaches having to burn bunches of DVDs. Five years ago, CEO David Graff and two fellow graduate school students started the company, with the Cornhusker football program as their only customer.


Graff each of them put up $10,000, they hired an intern, and just started working. "It was a fun time. We knew we were building for Nebraska," he recalls.


But it didn't stop there. After Head Coach Bill Callahan was fired by Nebraska and became assistant coach for the New York Jets, that pro team became Hudl's second customer, and more colleges began to sign up as well.

But the real growth came from high schools. By last year, Graff says, the company had about 20 employees, and was serving about 2200 high schools with around 20 employees. And that growth has continued. "We've now got a team of 41 here in office. We've grown that 2200 figure to 6500 high schools around the country. And we've just completed the acquisition of our biggest competitor in this space," he says.


Hudl's growth so far has been fueled by private investors. It's not that Graff's opposed to state help if it's offered. The company's now taking advantage of a state program that offers free training through the Gallup organization. And it's planning to use the Nebraska Advantage program of tax breaks for companies that create jobs and invest. But Graff says ultimately, people's attitudes could prove more important than state policies.

"I think that what can be the most helpful is just to get started. I think that's the biggest barrier, more so than any state legislation or any barriers that people envision," Graff says. "A lot of times those barriers exist in people's minds because they're just not ready to make that leap. I think if a lot more people make that leap, they'll find that if they get started in Nebraska or they want to get started in Nebraska or wherever it is, they're going to be successful if it's a good idea."


Hudl's success so far may have had little to do with state government. But doesn't Nebraska's low unemployment, especially now, mean that overall, this state's policies are helping create jobs? Ken LeVasseur, an economist with the Bureau of Labor Statistics, says low unemployment in Nebraska is nothing new.

"We have statewide data for 35 and a half years now. And Nebraska has typically been one of the lowest unemployment rate states in the country, in good times or bad," LaVasseur says.


RELATED
DOCUMENTS

Click here for "Growing State Economies," a report from the National Governors Association


Click here for the 2011 "Enterprising States" report from the U.S. Chamber of Commerce

During those three and a half decades, Nebraska's unemployment has ranged from a low of 2.1 percent, in 1998, to a high of 6.7 percent, in 1983. Both the high and the low are the second lowest for any state during the period. (For a link to historical unemployment data, click here)LeVasseur says it's no coincidence that North Dakota and South Dakota flank Nebraska as the states with the lowest and third lowest current unemployment rates. And he suggests that could be related to prominence of agriculture in Plains States' economies.

"In the Midwest, with the large farms, often there is family or other related activity. So that there's often something to do so people are employed whether it's a wage and salary job or self-employed on a farm that they own or someone in the family owns," he says, adding "That tends to give us low unemployment rates because those people are working."


Still, Omaha Federation of Labor President Terry Moore says Heineman and the Legislature deserve credit for policies that have kept Nebraska's unemployment rate low. But Moore, too, says it's not just a recent development.


"I think we've been really blessed with a series of governors - back to Frank Morrison, Jim Exon, all the way through - we've had some pretty good governors that have really held economic development as their key part of what their job should be," says Moore. "And that is exactly where it's at and this governor has done so just as well."

Mark Schill, who consults with states and regions about economic development, says each has its own "economic DNA," and what works in one place might not apply in another.

Schill co-authored a recent report on states' economies for the U.S. Chamber of Commerce. He says having outsiders take a look and suggest options, like Heineman wants the governors to do, can be helpful.


"It certainly is helpful for someone that's not carrying any political baggage or doesn't have an axe to grind with the local economy to come in and say Here's what we see,'" says Schill. "Even if it comes down to interviewing a hundred people within a state or region they can take a step back and look at what they're finding and start piecing things together that maybe the folks on the ground may not have seen," he adds.


Under Heineman's initiative, governors will get profiles of their state's small business and economic environment, along with a report on policy options. Four regional summits will also be held, with entrepreneurs, business owners, researchers and other experts talking about barriers and best practices. They'll begin in Hartford, Conn. in October, continue in Nashville and Seattle, and conclude in Omaha next April.

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