1. Egils Milbergs
Executive Director
Washington Economic Development Commission
www.wedc.wa.gov
Four Pillars for Economic Growth
and Job Creation
MakingitinWashington
February1,2012

2. Commission Members

3. Data source: U.S. Bureau of Labor Statistics, Current Employment Statistics
Recovery: Non-farm Employment
Monthly difference with start of recession (Q4 2007)
-208.1
-250
-200
-150
-100
-50
0
50
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50
DifferencewithInitialPeriodEmployment
(ThousandsofWorkers)
Months of Recovery
2001 Recession (3 quarters) Since Q4 2007

4. Data source: U.S. Bureau of Labor Statistics, Current Employment Statistics
Non-farm Employment
Seattle-Bellevue-Tacoma Metropolitan Area
-118.9
-71.2
1,340
1,360
1,380
1,400
1,420
1,440
1,460
1,480
1,500
Aug-07
Oct-07
Dec-07
Feb-08
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
Jun-11
Aug-11
Oct-11
Dec-11
Line indicates employment level in April 2008 (recent max)

5. Key Performance Comparisons
(by range, state rank and trend)
5WEDC 1.4
$45,464
1.8%
$43,564
0.442
4.0%
86
Real per capita GDP, 2010
Non-farm employment
growth, Nov ‘11 3mma
Per capita personal
income, 2010 (current USD)
Gini Coefficient,
2005-2009
Computer and
mathematical occupations,
as % total workforce, 2010
Patents (all types) per 100k
residents
AK, DE, CT
ND, OK, UT
CT, MA, NJ
UT, AK, NH
VA, MD, WA
VT, WA, CA
Washington’s Rank
#14
#11
#14
#19
#3
#2
$29,318
0.8%
0.499
$31,046
4.6
-0.8%
$63,090
$54,877
4.9%
0.411
106.8
5.1%
(Scale in reverse)
(More than double 2005)

6. Data source: Washington State Employment Security Department.
Non-farm Absolute Gains and Losses, Year-over-Year
Seattle-Bellevue-Tacoma Metropolitan Area, November 2011 (1000s workers)
-0.63
-0.33
-0.33
-0.33
-0.03
1.30
1.77
1.83
3.73
8.63
Credit Intermediation and Related Activities
Insurance Carriers and Related Activities
Accounting, Tax Preparation, Bookkeeping and Payroll
Truck Transportation
Air Transportation
Administrative and Support Services
Architectural, Engineering and Related Services
Software Publishers
Computer Systems Design and Related Services
Transportation Equipment Mfg
LargestLossesLargestGains

7. The Good and the Bad
Reasons for Optimism
• Young, connected, smart people
• Strong anchor companies:
aerospace, food, information
technology, medical, non-profit
• Intellectual property hotspot
• Attractive place to live
• No income tax
• Pacific Rim location
• Potential defense opportunities
• Growing entrepreneurial sector
• Abundant energy sources
Reasons for Pessimism
• Global uncertainty
• Long term unemployed
• Skills mismatch
• Short on engineering talent
• Underperforming schools
• Poor transport infrastructure
• Lagging regions
• Income disparity
• Cost/complexity to start a new
business.
7WEDC 1.4

8. To accelerate job creation, WA must make
progress on four dimensions
Intellect
Investment
Infrastructure
International
Emphasize career transition, access to learning
resources and the skills that employers need.
Create innovation ecosystem to foster
new products, start-ups and manufacturing.
Design a 21st century infrastructure, an efficient
regulatory system and align to regional objectives.
Grow the global presence of Washington’s business.
8WEDC 1.4

9. Policy Specifics Around the Four Pillars
TALENT and
WORKFORCE
1. Channel talent
pipeline to
industry needs
2. Shift focus of UI
to support new
career prep.
3. Retain foreign
student
graduates
4. Navigate career
choices with
personalized
information
INVESTMENT
and
ENTREPRENEURSHIP
1. Recruit STARs
research teams
2. Provide
operational funds
for IPZs
3. Turn on FDI
4. Enhance tax policy
to close gaps in
commercialization
INFRASTRUCTURE
and REGULATIONS
1. Assess economic
development
outcomes.
2. Create Lean
Institute for
regulatory
efficiency
3. Align infrastructure
investments to
local priorities
4. Pilot self financing
of collaborative
innovation.
INTERNATIONAL
BUSINES
(Exports)
1. Optimize export
services to SMEs
2. Modernize
transportation
infrastructure for
freight mobility
3. Intensify
innovation
collaboration in the
Pacific Northwest.
SOURCE: Statement of Priorities for Kick-starting Job Creation, Washington Economic Development Commission, Nov 22 , 2011
9WEDC 1.4

10. Workforce Challenge
WA Economic Development Commission 10
Technical
Prof
Technical
Unskilled
Prof
Unskilled

11. Washington STAR Researchers
Michael Hochberg Birgitte Ahring
Chen-Ching Liu
Daniel Kirschen
UW
WSU – BSEL Center for Bioproducts and Bioenergy
Smart Grid
WSU
Hugh Hillhouse

12. Faces of Emerging Industries
Entrepreneurs-in-Residence
Lars Johansson
Ronald Berenson
Terri Butler
Henry Berg
Stephanie Amoss
Ken Myer
David Kaplan
David Croniser
Thomas Schulte
Bryan Zetlan
Lewis Rumpler
Peter Quinn
Karen Fleckner
Kevin Petersen
Jeff Canin
Chris Leyerle

13. Startup Weekend
WA Economic Development Commission 13

14. Whidbey Island
Naval Air
Puget Sound
Naval Shipyard
Joint Base
Lewis McChord
Madigan Medical Center
Naval Submarine
Base Bangor Spokane
Fairchild AFB
US Coast Guard
WA Nat’l Guard
US Army, Yakima
US Marine Corps
Opportunities in Defense Technology
191,000 jobs
$12.2 billion in output
$10.5 billion in labor income
$5.2 billion in defense contracts
Intelligence, Surveillance, and Recon
Special forces and special operations
Network-centric operations
Cyber security
Composite materials
 Unmanned systems – both air and sea
 Energy efficiency
Environmental stewardship
Health care for veterans
Naval Station
Everett
14

15. Transforming Infrastructure
Post “ICE” Age?
Internal Combustion Engine
15
Leave oil
before it
leaves us!
15WA Economic Development Commission

16. Innovation Partnership Zones
Bellingham Innovation Zone
Aerospace Convergence Zone
North Olympic IPZ
Tri-Cities Research District
South Lake Union Life Science IPZ
Spokane University District IPZ
Bothell Biomedical Manufacturing
Corridor
Central Washington Resource
Energy Collaborative
Grays Harbor Sustainable
Industries
Pullman –Clean Tech Industries
Walla Walla IPZ
Interactive Media and Digital Arts
King County Financial Services
Collaborative
Urban Clean Water Technology
Zone

17. WA Economic Development Commission 17
Washington’s Global
Health Ecosystem

18. T
S
R&D Assets
•University based research centers
•National Labs (gov’t)
•Corporate Labs
•Inventors (patent owners)
Transformers
•Entrepreneurs
•Start-ups
•Incubators
•Technology Development Initiatives
•Industry University Collaborations
T
Funders
•Government Policies/Programs/Incentives
•Venture Capital
•Angel/Seed Networks
•Corporate R&D
•IPOs
S
Support
•Regional Innovation Clusters
•Talent pool
•Professional (Legal, Accounting, HR , Mentors)
•Marketing and Branding
Innovation
Ecosystem
Not just ingredients but the
relationships
Adapted from Navi Radjou, Forrester Research18WA Economic Development Commission

19. Innovation Ecosystems Evolve
Growth
Transformational
Nascent
Emerging
None or few firms
Growth potential
Few to many firms
Fast growth
Some linkages
Accelerated
collaboration
Many linkages
Attraction of firms
Many nodes
Dense linkages
Region to Region
Next generation
STARS
IPZs
R&D
EIRs
Patents
Incubators
Innovation
Triggers
Tax
Incentives
Talent
Gap
Funding SBIR
19WA Economic Development Commission

21. 21
Fiscal constraints require new priorities
Some difficult choices for economic development
Reduce Create
Eliminate Invest
Tough
Trade-offs
Economic
Development
Programs
Outcomes
Jobs
Income
Distribution
Per capita GDP
growth
Quality of life
Tax revenues
WEDC 1.4

22. 22
Current Economic Development System
Many pieces, but how do they work together?
Dept of Commerce
18 Programs
Governor’s Office
Strategic Reserve Account
Employment
Security
Department
15 Programs
Dept. of Agriculture
5 Programs
Dept. of Social &
Health Service
3 Programs
WSDOT
2 Programs
OSPI /Early
Learning
3Programs
WA SBCTC
10 Programs
Workforce Training
Board
2 Programs
Washington State
University
5 Programs
University of WA
6 Programs
36 other state economic programs
Recreation &
Conservation Office
14 Programs
Innovate WA
8 Programs
Trade Associations
Economic
Development
Councils
Innovation
Partnership
Zones
City & County
Government
Federal
Labs
SBA
Dept. of
Agriculture
SBIR/STTR
Dept. of
Defense
Business and Local Economic Development Organizations
FederalPrograms
Dept of
Commerce
Associate
Development
Organizations
WEDC 1.4

23. PNWER Region (GDP/Pop.)
State/Prov. GDP* Population
Wash. 322,778 6,549,224
Alberta 291,300 3,735,086
B.C. 191,006 4,551,853
Oregon 161,573 3,782,991
Idaho 52,747 1,545,801
Alaska 47,912 686,293
Sask. 41,296 1,049,701
Montana 29,885 974,989
NW Terr. 4,124 41,464
Yukon 2,026 34,157
Total 1,144,647 22,901,559
*2009 population & GDP in $US Million
Data provided by PNWER – Pacific Northwest Economic Region
Pacific Northwest is an innovation powerhouse
If PNWER were a
separate country,
it would rank 14th in
total GDP
23WA Economic Development Commission
If PNWER were a
separate country,
it would rank 14th in
total GDP

24. 24WA Economic Development Commission