RICHARD FLORIDA Colleges and Universities Are the Hubs for The

RICHARD FLORIDA The Flight of the

THE UNITED STATES is currently undergoing a economy, we will not become more prosper- dramatic economic transformation, more dra- ous, unless we further develop all of our hu- matic even than the previous transformation man creative capabilities. from a farm-based economy to an industrial economy. This has been variously described as Two economies a transformation to an “information econ- At the turn of the last century, most Ameri- FEATURED TOPIC omy,” an “internet economy,” a “technology cans worked on farms. Less than 5 percent economy,” a “high- worked in what I have come to call the cre- tech economy,” a ative sector of the economy—science, tech- “knowledge economy,” or even a “post-indus- nology, innovation, art, culture, music, Colleges and trial society.” Those are all wonderful terms, design, entertainment, and the knowledge- universities are the but I prefer the term “creative economy” be- based professions. By 1950, a growing number cause, intuitively or emotionally, I find it of Americans, approximately 50 percent, hubs for the new more inclusive. Every single human being is worked in manufacturing. Fewer worked on microeconomics of creative. The great challenge of our age is to farms, and less than 10 percent worked in the regional growth tap and harness all of that creativity. creative sector of the economy. The real ex- We are shifting from an economy based on plosion occurred between 1980 and 2005. In physical inputs—land, capital, and labor—to that twenty-five-year period alone, twenty an economy based on intellectual inputs, or million new jobs were added in the creative human creativity. Although economic trans- sector of the economy. Now, over the course formations are always difficult and require of the next decade—according to data from great sacrifice, this shift is cause for tremen- the Bureau of Labor Statistics—ten million dous optimism. If we can emerge from the cur- new jobs will be added in the creative sector rent transformation in the right way, then for of the economy. the first time in human history our economic But our conception of the creative econ- future will depend upon the further develop- omy must be expanded beyond science, tech- ment of human beings. We will not grow our nology, and design to include all applications of creativity. The United States will lose half RICHARD FLORIDA is the Hirst Professor in the a million manufacturing jobs, but it will add School of Public Policy at George Mason another five million jobs in the service econ- University, a senior scientist with the Gallup omy. The economic futures of those of us who Organization, and a non-resident senior fellow are fortunate enough to participate in the at the Brookings Institution. He is author of creative sector, compared to those of us who The Rise of the Creative Class (Basic Books, toil in the service economy, are bifurcating. 2002) and The Flight of the Creative Class: We are creating two separate economies. The New Global Competition for Talent Seven-hundred-fifty-thousand new retail (HarperBusiness, 2005). See www.creativeclass.org sales jobs will be created. Many of the compa- for more information. nies now operating in the retail sector are taking

22 L IBERAL E DUCATION S UMMER 2006 Creative Class The New Global Competition for Talent

Annual Meeting FEATURED TOPIC Annual Meeting Richard Florida, 4L 24 mans, Best Buy, Weg- WholeFoods, Wal-Mart’s. Companieslike a strategyverydifferentfrom service sectoraswell. where 30percentofusnowwork,butinthe board—not justinthecreativeeconomy, but toupgradecreativeworkacrossthe design andinnovationtocreatenewproducts, The realchallengeofourtimeisnottouse harnessing thecreativityoftheirworkforce. companies. Butmostimportantly, theyare all sortsofhigh-technology best placestowork,alongwith magazine asbeingamongthe They arerecognizedby and providingbetterbenefits. tainer Storearepayingbetter IBERAL IKEA E , andtheCon- DUCATION S UMMER Fortune 2006 the creative economy the creative must beexpanded Our conceptionof design toinclude beyond technology, all applications of creativity science, and livelihood.Hecautions competition, andthreatensAmericanjobs world morehomogenous,hascreated talists fromIndiaandChinahasmadethe argues thatbringinginthreebillionnewcapi- of theplayingfieldaroundworld.He single biggestthreatofourtimeistheleveling is flat.Friedmanhascometobelievethatthe and potential. of hurdles,butthereisgreat economy. Therearealot we aremovingintoacreative argued recentlythattheworld Thomas Friedman(2005)has New York Times Globalization All ofusarecreative,and his own columnist daugh ters to study hard and do well because, somewhere The role of colleges and universities in India or China, there is a student who is Colleges and universities are the hubs for this studying hard and who will compete with new microeconomics of regional growth. The them directly for a job. In order to innovate in conventional view among economists is that this flat new world, he says, one no longer has the university is an engine of innovation: re- to emigrate. search leads to new ideas, which lead to new in- Working with Tim Gulden of the Univer- ventions, which lead either to an increase in sity of Maryland, I decided to take a look at the productivity of existing companies or, better the data. We plotted where people in the world yet, to the creation of spin-off companies. But, as live, where light emission maps show signifi- discussed in a new report called “The Univer- cant energy use, where economic activity sity in the Creative Economy”—which my col- FEATURED TOPIC takes place, and we did some fancy analytics leagues Gary Gates, Kevin Stolarick, and Brian with patenting data to show where innovation Knudsen wrote with me—the university is far occurs. We also looked at rates of scientific more important to the creative economy than and technological publishing in universities. that simple-minded view allows. That conven- We found that Friedman has got half of the tional view oversells the role of the university story absolutely right. Advances in technology because it oversells what we do least well. and communications, as well as trade and My theory of economic growth is simple. transport, certainly have made the world flatter I call it the “three Ts”: technology, talent, and in a sense. Many more places are now open for tolerance. All growing, exciting, talent-magnet business. But really, the world is not flat at all. regions do all three things well. They invest In fact, from population to production to in- in, exploit, and utilize technology. They also novation to science, the world is increasingly attract, utilize, and retain talent. But talent mountainous or spiky. We wrote a piece for does not just happen to come to a particular the Atlantic Monthly called “The World Is region. It is not just born in the region, and it Spiky” (2005), in fact. does not necessarily stay there. People are Here’s what we saw. The world is built around a dozen or two mega-regions. Sure, if you look at it from New York to Washington, PODCASTS DC, to Bangalore to Shanghai to Zurich to Paris to London, then everything from the top The articles published in the Featured Topic of the peak looks completely flat. But in order section are adapted from presentations made to make it in the world today, you had better by the authors at the 2006 annual meeting. scramble to get yourself onto one of those The original presentations were recorded and, peaks, because the distance between the peaks along with others from the annual meeting, and the valleys is growing wider every day. are available as podcasts from the AAC&U The motor force that is driving the world Web site. economy is not a tendency toward decentral- In addition to the annual meeting podcasts, ization. Rather, it is a simultaneous decen- several recorded presentations from recent tralizing and centralizing tendency. It is not a Network for Academic Renewal meetings are one-way street, it is a dialectic. The world is also available, including a recent address becoming flatter and spikier at the same time. on “Improving Undergraduate Education” The reason people concentrate is very sim- by Derek Bok. A full listing of AAC&U ple. It does not have to do with jobs and eco- podcasts is available online. (Instructions for nomic opportunity. It does not really have to those new to podcasts are provided.) do with amenities and lifestyle. When people concentrate in one place, they gain enormous www.aacu.org/podcast economic leverage or productivity advantage. When they cluster together—people, not just companies—they make each other more pro- ductive, they make each other more inven- tive, and they complement each other’s skills and talents. And all of this leads to robust economic growth.

S UMMER 2006 LIBERAL E DUCATION 25 FEATURED TOPIC Annual Meeting 6L 26 portant, themorecriticalwaycollegesand and employment.Yet whiletechnologyisim- search intechnologyaddstoregionalearnings inlargemetropolitanareas,re- Particularly sity inthecreativeage?Theuniver- universities themselves freely. they canleadtheliveswantandexpress want tocomeandcaneasilygetto,where region, youneedthekindofplacethatpeople It takesanopensystem.To createagrowth them, andthattakeswhatIcalltolerance. talented andcreativepeopleorto“grow” The mostimportantthingiseithertoattract highly mobile.Talent isnotastock,itflow. What, then,istheroleofcollegesand plays abigroleintechnology, ofcourse. IBERAL E DUCATION S UMMER 2006 Austin aretwoperfectexamplesofthat—places people and,often,companies.Bostonand versity, orifithasseveralofthem,attracts portantly, ifatownhasgreatcollegeoruni- greatundergraduates.Butmoreim- attracts graduate studentsandfaculty, thenitalso attracts greatgraduatestudents;ifithas or auniversityhasgreatfaculty, thenit directly, theyalsodoitindirectly. Ifacollege to theirpooloftalent. to connectpeopleoneanother, andtoadd their mostbasicfunctionsaretocreatetalent, leges anduniversitiesaretalentmachines; situated isthroughtheothertwo“Ts.” Col- universities affecttheregionsinwhichthey’re Colleges anduniversitiesnotonlydothis Colleges and universities tend to affect people’s life satisfaction where companies have lo- not necessarily through only 10 percent have a cated in large part because their own direct positive score on Stolarick’s universities have produced index. In other words, 90 large pools of talent for educational experiences percent of all metropolitan them to tap. And a college but through their regions in the United or university adds to the perceptions of their cities States are net exporters ambience of a region and of talent—they lose their allows it to attract people. creative young people. If you take the number of people in a partic- That is precisely the kind of migration we are ular college or university in any region in the experiencing in this country. It is not enough United States and compare it to the number of simply to have a strong college or university. FEATURED TOPIC people in that same region who have a college It is the relationship between the colleges degree, as my colleague Kevin Stolarick at and universities and the regions that creates Carnegie Mellon has done, you can create a maximal impact. “brain gain” index. Of the more than three Tolerance, the third “T,” is the key variable. hundred metropolitan regions in the country, The regions that are most open to different lifestyles and to people who think differently or who express their creativity differently have the kind of ecosystem that attracts talented and entrepreneurial people across the board. Colleges and universities have an enormous effect on tolerance because they help to create environments that are open to different lifestyles. They have become the new Ellis Islands of our country, attracting talented and skilled immigrants. Immigrants are powerful spurs to growth, and colleges and universities are focal points for attracting those immigrants to a particular region. Moreover, they are the kinds of places where talented people of all stripes interact. A stimulating intellectual environment creates the capacity to innovate and, in turn, to create regional success. Colleges and universities have to contribute to the regional absorptive capacity of a creative ecosystem. They need not only to generate in- novations but also to absorb them. In other words, although a college or university may be sending out the right signals—and the signal may be strong—the receiver in the region may be switched off. Getting that match between signal and receiver, between the college or university and the community, and creating a seamless web of connections between them is very important. By comparing measures of creativity to measures of the universities and colleges pre- sent in a region, you get what I’ve called a “creativity index.” The large metropolitan regions are obvious: Silicon Valley and the Bay Area, San Diego, Austin, Boston, Seattle, Chicago, Denver, and Los Angeles. The mid- side regions are interesting: Lansing, Madison, Albany, New York, and Ann Arbor. And the

S UMMER 2006 LIBERAL E DUCATION 27 FEATURED TOPIC Annual Meeting 8L 28 IBERAL E DUCATION S UMMER 2006 small regions are very interesting: Gainesville, their own direct educational experiences but Bryan (Texas), Bloomington, Corvallis, Iowa through their perceptions of their cities. City, Lafayette, and Charlottesville. The cre- When we looked at this by level of educa- ativity index suggests that although there are tion—people who did not go to college or many places where the signal is not being re- university, people who went to college or uni- ceived, there are many places of various sizes versity, and people who went to graduate where it is. school—we found that positive perceptions of Another thing the index suggests is that colleges and universities actually decrease certain big regions remain unaware of this. with the level of education. It’s almost linear: When people ask me about the future of De- people with no college or university education troit, for example, I respond by telling them are the people who value it the most. This is a FEATURED TOPIC that the future of Detroit has little to do with very interesting finding, and it may suggest a rebuilding the renaissance center. The future need to more actively build connections not of Detroit instead depends upon building a only to community leadership but also to the strong and fundamental connection to Ann Arbor. When people ask me about the future of Indianapolis, I point out that there are two fabulous college towns filled with students within a half-hour’s drive. Indianapolis needs to build an integrated super-region. The point is there’s considerable leverage in smaller and medium regions as well as in the big ones.

Life satisfaction I’m involved with the Gallup Organization in an ongoing study of subjective well-being, human happiness, and life satisfaction. I’ve worked with David Wilson and Darby Miller- Steiger and a cracker-jack team of Gallup’s polling people to survey three thousand people so far, and our group will survey tens of thou- sands of people before the study is completed. This is the first time that the role of place and community in people’s lives has been examined, and the preliminary findings are surprising. community more broadly—not just our con- Annual Meeting We’re finding that people’s perceptions of stituents, not just highly educated people like colleges and universities have a significant ef- us, but all those people who view the colleges fect on their satisfaction with their communi- and universities in their towns as pathways to ties. When asked to describe their ideal city, a better life. ■ people tend to identify quality of life issues, aesthetics, openness to diversity, and the pres- To respond to this article, e-mail [email protected], ence of great colleges and universities. All of with the author’s name on the subject line. these characteristics are important factors in determining people’s willingness to stay in their communities. The way people perceive REFERENCES colleges and universities has a lot to do with Friedman, T. 2005. The world is flat: A brief history of whether they want to stay in their city, and it the twenty-first century. New York: Farrar, Straus and Giroux. has a great deal to do with whether or not Florida, R. The world is spiky. 2005. The Atlantic they would recommend it to their friends or Monthly 296 (3): 48–51. relatives. In this regard, people’s views of colleges and universities are far more important than the more traditional “pocketbook” issues. Colleges and universities tend to affect people’s life satisfaction not necessarily through

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