October 24, 2017

Rural communities can compete for jobs if they look to lower risk

By: Jason Hagey   Comments: 0
Mark Sweeney, senior princiapl, McCallum Sweeney Consulting, discusses how employers consider site selection, as he gives lunch keynote remarks during AWB's Rural Jobs Summit at Big Bend Community College in Moses Lake on Oct. 24, 2017. (Photo: Brian Mittge/AWB)

Rural communities can compete with urban areas when it comes to attracting employers, but they need to understand their strengths and weaknesses and be prepared when opportunity arises.

“There is no perfect place, so don’t get disappointed,” Mark Sweeney, senior principal at McCallum Sweeney Consulting, told an audience Tuesday at AWB’s Rural Jobs Summit. “Rural areas can compete.”

Sweeney, who works as a site selector for major corporations, offered a behind-the-scenes look at the world of site selection and some practical advice for how rural communities can position themselves to retain and attract employers.

Sweeney was joined by Jeff Sayer, managing partner of Rectify Partners and the former Idaho commerce director, in presenting the luncheon keynote address at the day-long summit at Big Bend Community College in Moses Lake.

Employers have real choices about where to locate and competition is real, Sweeney said. One of the biggest factors they consider, he said, is risk.

“My clients are risk-averse,” he said.

Potential risks that can be heightened in rural communities include:

  • Real estate – If the location isn’t successful, will the company be able to sell it?
  • Labor – Is the workforce sufficient to support the business?
  • Growth potential – The community may be able to support the business now, but can it grow with the company?
Communities can position themselves to attract employers by identifying areas where their risks are high and taking action to reduce them.

“It really is a business analysis,” said Sayer, who reinforced Sweeney’s comments about how communities can prepare for attracting employers.

Jeff Sayer, the manager partner at Rectify Parnters, LLC, discusses his experience as Commerce Director for the state of Idaho as part of the lunch keynote during AWB's Rural Jobs Summit at Big Bend Community College in Moses Lake on Oct. 24, 2017. (Photo: Brian Mittge/AWB)
Sayer said he learned a lot during his four years as Idaho’s commerce director. When he started, Sayer said he was prepared to talk about taxes – and specifically the need to lower them – but quickly learned about the world of site selection and the check-list that site selectors use.

At the time, Idaho did not offer tax incentives, which Sayer came to realize was a liability. After looking around the country for best practices, Idaho ended up adopting a “tax reimbursement incentive” based on Utah’s example, he said. By using a company’s own tax revenue to pay a reimbursement incentive, it meant there was virtually no risk to the state.

After adopting the incentive program, the state started to win some projects.

It wasn’t just incentives, though, that led to the successful recruitment of Chobani, a New York-based yogurt maker that built a 1-million-square-foot operation in Twin Falls. Speed was a major factor, Sayer said. The company built the plant in just 320 days with cooperation from government officials.

“The governor promised, ‘I will stay two weeks ahead of you every step of the way,’” Sayer said.

Both speakers agreed it's a mistake for communities or states to assume their quality of life is sufficiently high that they don't need to compete for employers. Quality of life is relative and every community – from urban to rural – sincerely believes theirs is the best, Sweeney said.

Even the Garden of Eden had a bit of an "apple issue," he said, and a "reptile issue," too.