November 19, 2020

How America’s Communities Can Recover from COVID-19

By Richard Florida, Joel Kotkin, and Ross DeVol

Lost in the politically charged debate over lockdowns versus reopening is the importance of developing robust strategies to guide longer-run economic recovery.

The economic, fiscal, social and health care costs of the COVID-19 pandemic are enormous, with the combined force of a national natural disaster and economic crisis. Lost in the politically charged debate over lockdowns versus reopening is the importance of developing robust strategies to guide longer-run economic recovery. With the federal government mired in political polarization, the development of such recovery strategies has fallen on local communities.

We were part of a process to develop the post-pandemic economic recovery strategy for Northwest Arkansas (NWA), a metropolitan area of more than half a million people, which is home to three major Fortune 500 firms and the University of Arkansas.
Working with a team of analysts at Heartland Forward, an economic think and do tank based in the region, we examined national and global trends reshaping our economy and geography, and took a deep dive into the region’s economy and key industries, its talent base, and quality of life based on arts, culture, and outdoor recreation amenities. Every community is different: Our strategy cannot simply be grafted onto other places. But our overall approach provides useful guideposts which communities – large and small, urban, suburban, and rural - can use to guide and inform their own recovery efforts.

Remote Work Makes Talent Key:
The shift to remote work is real. More companies are giving their employees the choice to work remotely. Roughly half of the workforce is currently working remotely, and that figure is likely to remain at least at 20 percent of the workforce after the pandemic. Across the nation, people have become unmoored by the COVID-19 crisis and are asking deep questions about how they want to live and work. With most companies cutting back and reducing their physical footprints, the driving force of local economic development has shifted to attracting and retaining talent to build their economies.

Our strategy seeks to leverage Northwest Arkansas’ affordability and appeal to families seeking more space and a less frenetic pace of life. We also recommended a focus on attracting remote workers, drawing from the example of Tulsa Remote—a successful program that has attracted hundreds of remote workers and thousands of applicants through a combination of small financial incentives—the availability of affordable housing and the creation of a community of remote workers. And we called for a Talent Moonshot, providing substantial cash grants to attract the best and brightest scientists, entrepreneurs, and creatives to the region. Communities can draw from these efforts to put talent attraction at the very center of their economic recovery strategies.

Grow the Economy and Jobs:
With the economy in recession and corporations shrinking their footprints, regions need to think carefully and develop comprehensive plans about how to grow their economies around leading clusters. In Northwest Arkansas, that means a focus on growing regional strengths in supply chains and logistics. Other regions need to define and promote their own strengths.

Bolster Small Business and Startup Ecosystems:
Startups and dynamic small businesses are the underlying growth engines of the US economy. But high-tech startups and their ecosystems are massively concentrated in the San Francisco Bay Area and East Coast Acela Corridor, which account for more than two-thirds of all venture capital investment in high-tech startups. Over the past several years, dynamic startup ecosystems have started to take root and grow in places like Pittsburgh, Kansas City, and Indianapolis, which Steve Case dubs “the rise of the rest.” In Northwest Arkansas, we recommended developing accessible small business loans, establishing an angel investor network, and bolstering industry-university research and commercialization partnerships. Other communities across the country must take steps to strengthen and develop their own startup ecosystems.

Prioritize Quality of Place
People are looking for great places to live and work. Northwest Arkansas is capitalizing on its affordability with signature investments in venues like the Crystal Bridges Museum of American Art and a leading-edge network of bike trails and open spaces. We called for the region to double down and expand these investments, and a new initiative to attract artists and creatives to the region is in the work.
The COVID-19 crisis tilts the balance toward locally sourced culture. With no Taylor Swift shows, no Rolling Stones concerts, no Coachellas, Bonnaroos, Lollapaloozas, or other mass culture events, communities have an opportunity to showcase local arts and culture. In Northwest Arkansas we recommended the region develop new platforms to promote local artists, musicians, performers, and chefs for neighborhood-based events in safer outdoor and socially distanced environments.

Build Complete Communities:
With people working remotely, the idea of commuting to the office has lost its appeal. People are getting used to living where they work. Urbanists have called for the making of this reknitting of work and life more permanent, by reshaping communities into more complete communities where people can better organize their daily lives. Organized around four separate communities – Bentonville, where Walmart is headquartered; Fayetteville, home to the University of Arkansas; Rogers, and Springdale -– Northwest Arkansas is well positioned to do just that. With less people working in offices, larger cities can transform some of the office towers in their central business districts into affordable housing, while suburbs and outlying areas can transform old office parks and abandoned malls into regional, socially distanced office centers.

Make Health and Resilience a Priority:
The COVID-19 crisis has put a premium on health and safety. People across the country and the world are looking for regions that will proactively address the crisis and enable them to remain healthy. Northwest Arkansas is creating a plan to invest $1.5 billion on a major new academic medical center which can put a "whole" health approach at the forefront of integrated medicine. Regions across the country must put health and safety front and center in their recovery strategies.

Put Inclusion and Equity at the Center:
The COVID-19 crisis has focused America’s attention on long-standing divides of race and class. The crisis hit hardest at the Black and Latino communities, with rates of illness, hospitalization, and death two to four times that of White Americans. Recent months have also seen a wave of political protest over issues of racial and economic injustice. Our recovery plan for Northwest Arkansas – which has emerged as a significant new destination for immigrants and minorities, particularly Latinos and members of the Marshallese community – puts inclusion and equity at its very center. Communities across the nation have the opportunity – and obligation – to do the same.

Our work in Northwest Arkansas represents a novel attempt to develop a comprehensive recovery strategy for the post-pandemic world. Most of all, we hope that communities across the nation and the world are inspired by our approach to develop recovery strategies of their own to rebuild themselves in the wake of the COVID-19 tragedy as more economically productive, inclusive, equitable and resilient places.

Florida, Kotkin and DeVol are co-authors of the Northwest Arkansas Economic Recovery Strategy. Florida is a professor at the University of Toronto, Kotkin is a Presidential fellow at Chapman University and DeVol is President and CEO of Heartland Forward, where Florida and Kotkin serve as senior fellows.