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Good News For Communities Scared of Economic Decline

West Philadelphia, home of the University of Pennsylvania, turns out at an Obama rally. (Photo by Raybanbro66 under a creative commons license.)

An increasingly globalized economy leaves communities, especially inner city neighborhoods, anxious about losing major employers. White-collar headquarters and blue-collar factories alike can be easily uprooted, as folks in Seattle know. Boeing Aircraft, once the city’s economic engine accounting for one in six jobs in the region, has moved its corporate offices to Chicago and is shifting many of its assembly jobs to North Charleston, South Carolina.

But there’s good news in every city when it comes to jobs. Some of the biggest employers aren’t going anywhere.

How can we be sure? Because “anchor” institutions like colleges, medical centers and cultural institutions serve the people of a particular area. Try to imagine Ohio State University moving to Dallas or Massachusetts General Hospital to China.

Anchor institutions are the largest employer in 66 of the 100 largest U.S. inner cities, according to a study from the Initiative for a Competitive Inner City. And on average they’ve weathered the downturn of last six years better than other industries.

That’s why many cities are promoting an “Eds and Meds” strategy to keep jobs, and boost struggling neighborhoods. This strategy works because these institutions are non-profits, chartered to pursue social goals not profits for private owners. In a sense, as tax-exempt organizations legally bound to pursue social goals, they “belong” to the broader community.

“Colleges and hospitals are embedded in their community and have a real stake in seeing that it thrives,” explains Paul Pribbenow, president of Augsburg College in Minneapolis, which is one of a dozen anchor institutions that have signed on to a joint effort with the McKnight Foundation to strengthen central city neighborhoods in Minneapolis and St. Paul.

“For us, this is about our students. It contributes to their education, their safety and a vital urban environment where they live,” adds Pribbenow. “This is not just what we give to the community, it’s about our shared interests and mutual benefits.”

Eric Muschler, a McKnight Foundation Program Officer, sees plentiful potential for these kind of mutual benefits in three sectors: personnel, procurement and placemaking. Anchor institutions can train and hire more employees from surrounding neighborhoods, purchase more goods and services from businesses in the neighborhoods, and participate in programs to improve communities’ quality of life.

The promise of the anchor institution strategy to improve struggling communities has been successfully tested in inner city Philadelphia, Detroit, and Syracuse. For an account of Cleveland’s success, see this earlier article.

Philadelphia

The anchor strategy was pioneered in the tough streets of West Philadelphia after a University of Pennsylvania student and a research assistant were murdered in the mid-1990s. The university was not going to pack up its lab equipment and libraries and move after 120 years in the neighborhood. Instead, it redefined its relationship with the surrounding community from isolation to interaction.

Through the tenure of three presidents, the school has been involved in West Philadelphia by sponsoring a school and school-based health center, connecting to seven other public schools, launching an incentive program for employees to rent or buy in the neighborhood, reviving commercial districts, spending $110 million yearly with local businesses (12 percent of total spending), and partnering with the Pennsylvania Minority Enterprise Council, which resulted in the creation of over 600 full-time jobs over the last decade.

“You don’t just work in one area such as reducing crime—that won’t do it,” notes Ira Harkavy of Penn’s Netter Center, one of the architects of the schools’ anchor strategy. “The key is that it’s about relationships and mutual respect. The institutions must change as well as the community.”

Detroit

Detroit sports a cluster of 2 medical complexes and Wayne State University in the Midtown neighborhood, which has become the focus of inner city revitalization efforts. The Henry Ford Health System established a 5-year program in Detroit high schools that trains and certifies students for jobs in 10 health-care occupations for which they have trouble finding qualified workers. Midtown Detroit Inc. partnered with the three anchors to offer incentives for employees to buy or rent homes in the area, which was so successful that it’s now hard to find an apartment or condo in the area—a big surprise in a city notorious for abandoned properties. And another program focused on increasing anchors’ spending at city businesses paid off when the two hospitals convinced vendor Cardinal Health to move its medical products distribution center and 140 jobs from suburban Romulus to Midtown.

Syracuse

The anchor strategy in Syracuse targets a corridor stretching from Syracuse University through downtown and into the Near Westside, which is one of the 10 poorest census tracts in America. Syracuse University initiated the effort upon realizing that even with a high academic standing and nationally ranked sports teams its image suffers by being located in a city with a 34 percent poverty rate. The school has raised $56 million (including forgiveness of $13.8 million loan from the state of New York) for its plans to better connect downtown with the campus and transform the Near Westside into arts/technology/design hub.

Anchor strategies are not confined to cities with tough social and economic conditions. A set of Boston hospitals has established an admired training, employment and housing programs to boost surrounding neighborhoods, and other projects are underway in Phoenix, Atlanta, Cincinnati and Washington, D.C.

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