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Publication Spotlight: 2/2018

Take a look at a recent Maxine Goodman Levin School of Urban Affairs publication:

The Healing Economy: An Economic Development Framework for Cleveland by Richey Piiparinen, Jim Russell, and Valdis Krebs

Document Type: Report
Publication Date: January 2018
  • The Cleveland metro has the densest health science labor market in the nation, with 14.5% of the region’s workforce employed in high-skilled healthcare delivery. Cleveland is ahead of Philadelphia (14.1%) and Boston (14.1%).
  • Since 2002, healthcare and social assistance jobs in Cuyahoga County increased from approximately 104,500 to 131,700, with the aggregate income from those jobs growing from an inflation-adjusted $4.8 billion to $6.9 billion in 2016.
  • A significant amount of Cuyahoga County’s healthcare jobs are clustered in Cleveland’s Health Tech Corridor. In 2003, 26.4% of all healthcare and social assistance jobs in Cuyahoga County were in the Health Tech Corridor, increasing to 36.2% by 2015.
  • Total employment in the Health Tech Corridor increased from approximately 41,200 in 2002 to 75,000 in 2015—a gain of 82%. Also, about 1 out of every 20 jobs in Cuyahoga County were in the Health Tech Corridor in 2002, increasing to 1 out of 10 by 2015.
  • Much of the year-over-year job growth in the region is happening in the Health Tech Corridor. From 2014 to 2015, 25% of all job growth in the Cleveland metro occurred in the Health Tech Corridor, whereas 39% of Cuyahoga County’s job growth happened in the corridor.
  • The job growth in the Health Tech Corridor is associated with increased real estate valuations. Inflation-adjusted assessed values for all property types in the corridor went from $3.85 billion in 2009 to $4.72 billion in 2015—a gain of 23%.
  • The clustering of healthcare services in Cleveland—termed a “knowledge cluster” in the current analysis—relates to the fact healthcare has become tradable, or exportable. Cleveland not only brings patients into the region, but delivers services nationally and internationally.
  • While Cleveland excels as a “knowledge cluster” in healthcare, the region performs less well as a “knowledge hub”, described as the region’s ability to produce life science research. Cleveland ranked 22nd nationally in R&D funding from the National Institute of Health in 2016.
  • The current analysis suggests state- and local-level policies should supplement seeding “downstream” innovation that facilitates start-up formation and technology transfer with the funding of “upstream” innovation that attracts “star scientists”, particularly in frontier fields.
  • In delineating frontier fields, the analysis borrows from the Four Sector Theory of economic development, which illustrates how a given nation’s or region’s economy evolves from primary (agriculture), to secondary (industrial), to tertiary (services), to quaternary (information). Today, Cleveland is still economically restructuring from a secondary to tertiary economy. Yet many regions are in the midst of a second economic restructuring from secondary/tertiary to quaternary, in which economic value is the data capital derived from a good or service, rather than the good for service itself. This data capital is the “oil” for the next-wave of innovation, principally in the fields of artificial intelligence (AI) and machine learning.
  • The analysis speculates on a potential “long game” for Cleveland in terms of developing an R&D hub in a frontier field, looking specifically at healthcare analytics. Due to regional assets, Cleveland can be a global node in population health research, in effect developing a data capital and AI/machine learning ecosystem that creates leading knowledge in the social determinants of health and reduction of health disparities.
  • A systematic, Cleveland-based intervention to reduce health disparities can be exported globally, igniting a tradable healthcare model that goes beyond selling services outside the region. This is a new type of economic development model operating as a global-local feedback loop. Here, the global export is the health of the local community.

To see all Maxine Goodman Levin School of Urban Affairs publications go to our Engaged Scholarship page.