Detroit, What Color is Your Parachute?

Okay, Detroit as it stands isn't working. So what do we do about it?

For ideas, I turned to Robert Weissbourd, president of Chicago-based research firm RW Ventures, an expert on economic and urban development, and the chair of the Obama Campaign's urban policy committee. Here's a guy with the research, background and experience to discuss the potential for development – what could drive people, jobs, housing and retail into Detroit.

We have some things on our side – and one of them is a President who understands urban centers and has a sympathetic ear for Detroit, Weissbourd said.

“Detroit is the poster child for every (urban problem),” Weissbourd said. “It's almost off the curve. … That is why its situation is that much more important.”

So he offered a three-part backgrounder on why Detroit has to change – and then a blueprint for what the city's Big Thinkers need to do next. Not easy stuff, but no one ever said change was easy.

Some background: Weissbourd has done neighborhood and regional economic development research and practice for decades. He spent 10 years at ShoreBank, a premiere development finance institution, which was expanding into Detroit at that time. In that position, Weissbourd spent time investigating the city and its surroundings.

Weissbourd is author of an important piece of new research, Dynamic Neighborhoods – New Tools for Community and Economic Development, which draws upon 20 years of data from Chicago, Seattle, Cleveland and Dallas to offer a new approach, with specific tools, to understanding change in different types of neighborhoods and regions.

Weissbourd also worked on “The Changing Dynamics of Urban America,” a report his advisory firm created for the group CEOs for Cities. The report is a wide-ranging look at the nation's metropolitan areas and the paths these cities could take to focus their growth well into the 21st Century. Good stuff, here.

Onto the topic at hand…The world today and the place of cities has changed in ways which could favor Detroit, Weissbourd said. We are in a different place now than we were 25 or so years ago. Back then, population growth and income growth went together. Cities got bigger in order to become richer. Not so any more.

“Now, population growth and economic growth no longer go together. To be wealthy and productive, you don't have to be big,” Weissbourd said. Rather, the so-called knowledge economy has made it possible for cities to remain relatively small and still have a beefy economic standing.

Okay – that's part one. Small can be beautiful.

The second change is that the economy no longer takes care of itself. Formerly, cities that were slacking eventually caught up with their more successful brethren. That is because labor and capital went to places where they were needed. Here's the problem: People who work within a knowledge economy stick together. They benefit from living and working side by side. So they stay in areas where there is a high population of similar people working in complementary job pools. That's great for cities that have this productive combination of jobs and skills, Weissbourd said. And it makes it more important than ever to be deliberate and strategic about the best combinations of skills and jobs Detroit can develop and attract.

Part Two: To succeed, you need to develop and attract complementary jobs and skilled workers.

Here's the positive stuff. Some had thought that people would love to work remotely; they would find some mountaintop and do their jobs from there. But that hasn't happened. The opposite is true, Weissbourd said. This is where Detroit could benefit: People love cities. They want to live near a diverse downtown center. They want walkable neighborhoods and jobs near their homes.  They benefit – in terms of lower costs and higher productivity – from living and working in dense communities.  Firms benefit from this concentration too: both people and firms are moving back towards density – towards downtowns -- nationwide.

Part Three: Build a great central city, and they will come.

So what does Weissbourd's research tell us? Well, Detroit needs to define itself – what are we going to concentrate on? We need to find what we will be gtood at -- our “Next Big Things” and center ourselves on them. We need to have the right jobs around to attract human capital. For example, Chicago has become a city of headquarters, and businesses have popped up around that theme. So now there is a huge cluster of companies providing financial services, legal services, business supplies, messenger services, office cleaning…You get my drift.

In fact, Weissbourd is working with a group in Ohio which is strategically re-focusing their economic region. They too are facing many of the same issues we are – they are too closely tied to automotive companies and suppliers. But they are turning this into a competitive advantage. They have firms and a rich talent pool from the auto supply chain that can become part of new emerging industries that they are targeting. So they're thinking of focusing on the advanced health-care products, things like creating hip joints and the like for those aging Baby Boomers.

“When you think about it, making a ball bearing for a car isn't that fundamentally different than making a ball joint for a hip,” Weissbourd said. “What they're doing is taking a subset of the automotive industry and retraining them for advanced manufacturing. Detroit has all those same skill sets – if they can find the next industry, they can build on those skills.”

I've heard that one before, and it makes sense for Detroit and the region. I think we're working on that. Another important part of that lesson is this, Weissbourd noted: No more bribing companies to come here. No more smokestack chasing. We need to build and attract a new economy here. We need to reinvent and then commercialize our knowledge base. That's big-picture thinking.

Here's the challenge: You need business and government to agree to work together on this.  And it requires a cultural change.  In an old industrial era, the old-boy system worked. You didn't have to worry about attracting outsiders; you protected what you had, Weissbourd said. There was a lot of centralized command and control; low risk tolerance; bureaucracy and a focus on stability.  But that doesn't work now.  The economy moves faster, and with more churn.  Entrepreneurs want a place that's easier to crack open. They want an infrastructure that supports their efforts. That means you need more informal networks, access, easy ways for them to get connected to each other, to business opportunities and investors, Weissbourd said.

So cities that do this well tend to be cooperative (hear that, county executives and mayors?) but they also have to be inventive. You have to be willing to try a bunch of new things and expect lots of them to fail. But if just one sticks, it can become part of your city's new economy.

“(Detroit) is so far gone it has to and can take risks,” Weissbourd said. “If they're willing to do it, if they're willing to open up and say, ‘We've got nothing to lose,' then you'll find that there are real assets in Detroit – the people, the land, the emerging business opportunities – and you'll  have a chance.”

As far as the neighborhoods go, support and attract residents – as Weissbourd's Dynamic Neighborhoods report shows, neighborhoods are constantly in motion, and thrive through attracting new residents and businesses.  And millennials, immigrants, “bohemians,” and others are moving to places where the real estate is inexpensive, that are close to downtown, jobs and transit, and that are reasonably safe.   Let the artists move in. They'll bring the coffeehouses, the eateries. Then the neighborhoods will feel alive and vital. That brings back the middle-class families. Now, a bunch of retailers will move in to serve this new population. Ba-da-bing. You got a real-life city again.

“There's some big plays in Detroit that need to happen and need to complement each other,” Weissbourd said. “You need a long-term strategy (and) you need to be inclusive. You need to align market, government and civic activity.”

Find your specialties. Seek out what's next. Open up. Back it up. Work together toward it. Got it. We'll get to work, Mr. Weissbourd. Thanks!