News

Know Our Strengths, Then Play to Them

Nov 4 2009

To attract new capital to New Orleans, we tend to market the city’s assets - its distinctive character, its beautiful architecture, its music. Meanwhile, the underlying deficiencies that keep investors away - crime, poverty, low literacy - continue unabated.

Last year, a consultant from Miami’s Beacon Council, a public-private economic development enterprise, advised the New Orleans City Council to put quality of life issues first and foremost in efforts to recruit outside investment. After all, the consultant said, corporations are made up of people and people come with families.

While the investment opportunity may look tantalizing to corporate leadership, it still has to pass “the spouse test.” Spouses of employees will want to be sure there are quality schools, nearby groceries and safe neighborhoods before they make the move.

To draw new money into the local economy and keep it here earning dividends, we must capitalize on our strengths. As a recent Travel and Leisure survey of America’s 30 Favorite Cities demonstrates, our music, food and architecture are certainly world-class. And in an increasingly homogenized world, entrepreneurs and skilled workers are more likely to invest and settle in communities that preserve their distinctive local character.

But character is not enough.

We must be a community with a well-educated labor pool, low crime, excellent schools and financially stable families.

In other words, we must have a healthy local economy firmly in place.

The Urban Conservancy, in partnership with urban retail analysis firm Civic Economics, recently released its study, Thinking Outside the Box: A Report on Independent Merchants and the New Orleans Economy.

Data collected from Magazine Street merchants on taxes, revenue, charitable giving and payroll shows local retailers, when compared with leading chain competitors, generate twice the annual sales, recirculate revenue within the local economy at twice the rate, and, on a per-square-foot basis, have four times the economic impact while consuming a fraction of the land.

Implications for New Orleans’ redevelopment are enormous. The study demonstrates that investing in locally owned businesses is a cost-effective way to grow the New Orleans economy and is compatible with development patterns in existing commercial districts.

The city can stimulate wealth creation and retention by developing a coordinated strategy that focuses on local businesses growth and retention as a prerequisite for business attraction.

Full retail occupancy along St. Claude Avenue, Freret, Canal, and Oak streets and our other commercial corridors is one indicator of success in stimulating local economic growth and stabilizing surrounding neighborhoods. Enforced procurement practices demonstrating New Orleans’ determination to build from within by sourcing with local vendors first and whenever possible will accelerate such a transformation. So will a more responsive City Hall that facilitates rather than impedes local business success.

Firms whose business models require continual expansion in order to avoid collapse will always invest in New Orleans, and every other population center with a pulse. We will never want for Walgreens, Family Dollar, or Dollar General stores. They need us far more than we need them. And residents tired of blighted and vacant commercial spaces will shrug their shoulders and say, “Oh, well. It’s better than what was there before.”

For the long-term health and vibrancy of our city, we need to attract firms that are investing in New Orleans because of its unique qualities, not in spite of them. Such firms will strengthen existing economic investment, not cannibalize it the way formula retailers requiring homogeneity and taxpayer-funded subsidies do.

Ultimately, however, the the robustness of our local economy is what matters most. Strong place-based businesses are key to the survivability, livability and prosperity of every community. And as quirky as New Orleans is, it is no exception to this rule.

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A condensed version of this article originally ran as a guest editorial in CityBusiness on October 5, 2009.

Filed under: Editorials | Rebuilding New Orleans