Economic Imperatives
Greater Phoenix is where innovation-enabling assets are concentrated in the state, accounting for around 70% of the state’s population, jobs, and economic output. Our region must set an accelerated course to solidify the nascent innovation-driven economy that takes on the global challenges of climate change, disruptive technologies, and shared prosperity. GPEC is convening business, community, civic and policy leaders to facilitate a dialogue towards this end.
The economic imperatives presented below are initial thematic areas of focus for envisioning the region’s 2030 future, focused on driving future competitiveness and opportunities for inclusive economic policies. Dialogue around these imperatives are taking hold in business leadership organizations, boardrooms, and city council and legislative chambers.
01 | Advance Career Technical Education (CTE), STEM and engineering pathways.
Over the next ten years, STEM occupations will grow two times faster than all occupations and it is critical that our market meets the needs of the expanding economy. To facilitate the successful technological adoption and fuel future growth in Greater Phoenix, industries are demanding quality labor with technical skills and technological know-how. This rising employer demand can be met with a coordinated system of multiple pathways to STEM careers from early childhood education to community colleges and universities.
02 | Meet the needs of Title 1 schools.
Title 1 is a federal program that provides supplemental funding to schools with higher concentration of students from low-income families. Title 1 schools have 40% or more students enrolled in the free and reduced lunch program. When Title 1 schools are sufficiently resourced, and education-innovation is embraced, they can deliver the workforce of the future and enable all students to capitalize on the opportunities of the new economy. There is overwhelming evidence that quality pre-kindergarten contributes to student success in K-12.
Brookings reviewed studies from across the country and concluded:
“Children’s early learning trajectories depend on the quality of their learning experiences not only before and during their pre-k year, but also following the pre-k year. Classroom experiences early in elementary school can serve as charging stations for sustaining and amplifying pre-k learning gains. One good bet for powering up later learning is elementary school classrooms that provide individualization and differentiation in instructional content and strategies.”
03 | Expand and foster a robust entrepreneurial ecosystem.
Greater Phoenix’s entrepreneurial advantage needs to be bolstered by an ecosystem of industries, investors, mentors, universities and research centers, and the public sector all playing a supporting role in scaling up businesses in high-tech growth sectors. Public policies and regulations will create a testing ground to support new and existing companies, and allow them to grow, create more jobs and generate higher revenues. For Greater Phoenix companies to unlock investment capital needed to scale, there needs to be a sharper focus on product development and validation.
04 | Accelerate industry and university collaborations.
The fourth industrial revolution will fundamentally change the way we live, work and relate to one another. This is an opportunity for Greater Phoenix to lead the technology domains where we have expertise and industrial capacity. Recent semiconductor investments by TSMC and Intel represent a transformative moment for our region. We can leverage these private-sector investments to accelerate the shift to an innovation-driven economy enabled by an expanded engineering education and rapid technology transfers.
Our region needs to continue investing in talent development, applied research and testing, and physical lab and engineering infrastructure. We need to incentivize university-industry collaborations to accelerate the pace of commercialization and growth of the new economy.
05 | Capitalize on environmental resiliency practices.
The realities of climate change, community resilience and economic growth are intersecting in significant ways in Greater Phoenix and around the world. Only by inventing, testing and applying innovative solutions in the broad spectrum of environmental pillars can our region emerge as a leader in the new economy. We need to leverage federal investments in the clean energy transition, coordinate with the state to support clean energy policies, and create “sandboxes” to test, validate and scale climate change technologies. We also need to align public and private resources to leverage climate technology advancements to invent, test and adopt solutions in support of the environment.
06 | Continue the strong history of water planning and conservation.
The recent and historic tier 1 shortage declaration along the Colorado River will impact 8% of the state’s total water use. While Greater Phoenix has capitalized on growth for decades, the future depends on the region’s smart use of water and natural resources. Greater Phoenix communities need to continue maximizing efficiency in utilizing natural resources. Long-term planning and conservation, the invention and adoption of sustainable technologies and cross-sector cooperation will drive the region’s sustained growth and prosperity.
07 | Induce smart growth principles and expand community tools for infrastructure and redevelopment.
Arizona is the 11th-most urbanized state in the country. In the next decade, urbanization will continue to intensify, but differently from the past. Telecommuting and new modes of mobility and delivery, such as drones and self-driving cars, will shape the future of our urban growth. Climate change and rising infrastructure costs will influence behaviors and affordability will drive us to rethink the concept of smart growth.
Our communities need new development tools to align broad development trends and meet local needs. These expanded development resources include creative financing and public-private partnerships for infrastructure improvements, in-fill development, affordable housing, site remediation and small business lending and financing.
08 | Continue modernizing Arizona’s tax system.
Arizona’s state and local tax system is fundamentally interdependent on economic growth.
Education, healthcare and infrastructure investments make communities more competitive and returns on these public investments are realized through sustained economic growth. State and local taxes keep our communities resilient and are vital to our region’s competitiveness.
09 | Strengthen the middle class.
National income growth of top and bottom quintiles outpaced the middle classes by more than double.
Middle-class Arizonans feel the impacts of weak income growth and a rapidly changing economy driven by technology and innovation. The region’s resilience is tied to the strengths of its middle class. A resilient future is achievable when more disadvantaged Arizonans move into the middle-income tier through stable careers with job security, benefits, continuing education and professional growth. And through access to affordable housing, family-sustaining wages and the opportunity to build intergenerational wealth.
10 | Unlock the potential of changing demographics of the region.
Our region must embrace its increasing diversity and create more access to capital in startup and growth companies, advance education access and opportunity, and enrich community building across diverse stakeholder groups.
Greater Phoenix had the third-largest population gain in the country between 2010 and 2019. Racial minorities were responsible for 68% of that growth. Our rapid population growth and changing demography favorably position our labor market for long-term growth. This demographic shift will infuse diversity of perspectives and values into the cultural DNA of our region.
We need to address national and global misperceptions about the region and realign them with the demographic changes underway.