Southwest Florida Key Industry Clusters

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Southwest Florida Key Industry Clusters SOUTHWEST FLORIDA KEY INDUSTRY CLUSTERS Prepared in partnership with: Regional Economic Research Institute • Florida Gulf Coast University Project Staff Christopher Westley, Director Veronica Kalich, Economist John Shannon, Economic Analyst Steven Scheff, Project Assistant Monique Carlone, Student Researcher Emily Reynolds, Student Researcher Alesa Whitehead, Student Researcher Report Information Florida Gulf Coast University’s Regional Economic Research Institute produced this report at the request of the Southwest Florida Economic Development Alliance. This work would not be possible without considerable cooperation from of Robert C. Beatty, Dean of the Lutgert College of Business, the Department of Economics and Finance, the RERI’s student researchers, and financial support from the Southwest Florida Community Foundation. The Regional Economic Research Institute studies, analyzes are reports on the Southwest Florida regional economy encompassing Collier, Lee, Charlotte, Hendry, and Glades counties. Established in 2005, it serves as a public service and economic development unit of the Dean’s Office of the Lutgert College of Business. Besides collecting and disseminating regional economic data, the RERI specializes in sampling design and analysis, including program evaluation, policy research, economic impacts, and workforce needs assessment. It also houses FGCU’s Industry Diversification Project and publishes the Southwest Florida Economic Almanac. The RERI involves FGCU students in every stage of its projects’ development, allowing them to develop professional skills and networks that add value to their degrees and, by extension, to their future employers. Regional Economic Research Institute Lutgert College of Business Florida Gulf Coast University 10501 FGCU Blvd, S. Fort Myers, FL 33965-6565 (239) 590-1000 http://www.fgcu.edu/cob/reri/ Photo Credits: Shutterstock, Lee County Economic Development, Southwest Economic Development Alliance 2 Southwest Florida Key Industry Clusters Table of Contents INTRODUCTION AND EXECUTIVE SUMMARY ............................................................................................................................. 4 BUSINESS SERVICES .......................................................................................................................................................... 10 CONSTRUCTION PRODUCTS AND SERVICES ............................................................................................................................ 20 DISTRIBUTION AND ELECTRONIC COMMERCE ......................................................................................................................... 32 EDUCATION AND KNOWLEDGE CREATION ............................................................................................................................. 45 FINANCIAL SERVICES ......................................................................................................................................................... 55 HEALTH AND WELLNESS .................................................................................................................................................... 66 HOSPITALITY AND TOURISM ............................................................................................................................................... 78 MARKETING, DESIGN, AND PUBLISHING ............................................................................................................................... 90 MEDICAL DEVICES .......................................................................................................................................................... 100 PERFORMING ARTS ........................................................................................................................................................ 108 TRANSPORTATION AND LOGISTICS ..................................................................................................................................... 116 Southwest Florida Economic Development Alliance 3 Introduction and Executive Summary Introduction and Executive Summary The first step in any attempt at any positive economic analysis is to apply empirical methods to draw out the data and see what they actually say. Ideally, once that function is completed, the results should then inform any normative or subjective opinions or policy proscriptions that follow. In the study of regional economies, ascertaining their composition, strengths, and weaknesses especially requires thoroughgoing empirical study that often takes the form of economics tools such as econometric modeling, economic impact studies, and cluster analyses. This last tool is employed in this first-of-its-kind study of the Southwest Florida economy. Cluster analysis groups similar entities based on characteristics that make them different from other groups. By identifying the various clusters that comprise a given universe—with universe defined as any closed system as defined for theoretical purposes—researchers can obtain a better understanding of it. When used for the purpose of regional economic analysis and economic development, cluster analysis often defines the universe in terms of an acknowledged geographic boundary. Within this boundary, clusters of industries, firms, and skills are identified and differentiated from other industries, firms, and skills. The more thorough the cluster analysis is, the more complete the understanding of the region’s economy. Ongoing cluster analysis provides a better understanding of changes in a regional economy over time, in which some clusters may grow or shrink in terms of dominance, while others enter or exit the regional economy as a whole. The present study analyses 11 industry clusters that characterize Southwest Florida, the geographic boundary comprised of Collier, Lee, Charlotte, Hendry, and Glades counties. The more concentrated industries (defined as industries with local concentrations that exceed that of the state) are assumed to provide output sufficient to satisfy the regional demand with excess that is “exported” outside of the region. Less concentrated regions, in contrast, are assumed to provide output in quantities less than the regional demand, thus resulting in a deficit that requires “imports” to the region. Some of the clusters considered here are disaggregated into two divisions, traded and local, to provide a more complete picture of these clusters’ presence and influence in Southwest Florida. Traded clusters refer to those portions of industries that serve other markets or regions. In Southwest Florida, this would refer to firms whose primary products or services cater to visitors and other non- full-time residents, as well as to firms that export products or services outside of the region outside the region. Local clusters refer to portions of industries that are found in every market and that primarily serve the local population. The clusters in this study that are disaggregated between traded and local are construction products and services, education and knowledge creation, financial services, and hospitality and tourism. Identifying these clusters serve to promote interconnections between the national and global economy with the regional economy by making opportunities to exploit and expand the specialization and division of labor clearer, for both the region’s exporting industries as well as to other regions that would import goods and services demanded in Southwest Florida—to recruiters, marketers, entrepreneurs, and policymakers. By expanding such interconnections, competition, output, and consumer choice grows, leading to lower prices and increased purchasing power of money. In other words, they make us richer, which in itself provides the basis for expanded investment for future growth. This report summarizes key points about each industry cluster, including a brief description and employment concentration ranking compared to the 21 other workforce regions in the state of Florida. In addition, location quotients are identified along with a brief assessment of the region’s competitive position and an assessment of the cluster’s educational and training support existing in the region and state. 4 Southwest Florida Key Industry Clusters 11 Major Industry Clusters Drive the Regional Economy BUSINESS SERVICES – Business services grew tremendously in Southwest Florida after Hertz Global Holdings relocated its world headquarters to Estero, in South Lee County. Employing some 15,423 people, business services provide professional employment opportunities to educated workers as well as careers for low-skilled workers. Jobs in this cluster vary, ranging from careers in finance and computer services to engineering and architecture. While overall employment in business services steadily declined between 2009 and 2015, its consulting services subcluster grew by 34 percent. CONSTRUCTION PRODUCTS AND SERVICES – The second-largest cluster in the region, Construction Products and Services employed 48,812 people in the region with significantly better short-term growth than the state of Florida as a whole. What is more, the annual wage growth rate between 2009 and 2015 for construction products and services has steadily increased, with an average growth rate of 3.9 percent in the Southwest Region. Both Lee and Collier counties have extremely high levels of employment specialization and employment share compared to the rest of the country. DISTRIBUTION AND ELECTRONIC
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