Across the country, regions and communities are creating networks and physical places where university researchers, businesses of all sizes, and capital come together, and emerging as a new foundation from which American innovation is rising. This is happening in places beyond the well-known tech hubs on the U.S. coasts—for example, in Tennessee, South Carolina, Indiana, Texas. Colorado, and Pennsylvania. We need to expand this innovation footprint even bigger and farther, and engage more Americans and U.S. regions in the innovation process.
Recently, the Council’s National Commission on Innovation and Competitiveness Frontiers issued a Call to Action undergirded by seven strategic pillars. Pillar 7’s recommendations call for Expanding Collaborative Innovation Networks. Several areas of action are high priorities:
First, U.S. leaders should seek to build innovation capacity in places where it is weak, and capitalize on places with higher capacity and entrepreneurial potential to boost regional and national competitiveness in technology fields. To lead this charge, the White House should establish a Regional Economic Development Council focused on strengthening U.S. innovation capabilities and capacity, and coordinating Federal, state, and local agency co-investment to achieve that goal. The Council should lead the development of a strategy to leverage private sector infrastructure, R&D, and workforce investments to maximize regional benefits and local impact. In addition, the Departments of Commerce, Defense, Agriculture, Energy, and Labor, and the National Science Foundation should expand their missions to explicitly support the growth of U.S. regional innovation ecosystems.
Second, we should develop new financing models to cultivate innovation ecosystems in underserved communities, particularly rural and urban communities that are disconnected from the innovation economy. Invest in advanced manufacturing “Enterprise Zones.” In addition, States could leverage the Department of the Treasury’s State Small Business Credit Initiative to offer small businesses and entrepreneurs equity/venture capital, loan participation, loan guarantees, and other capital access, and link this support to technology incubators and accelerators. Criteria and a certification process for “Innovation Districts” could be developed; certified districts could qualify for tax and other benefits, helping attract businesses to invest in R&D within designated areas. To achieve certification, economically distressed regions would be incentivized to strengthen partnerships among universities, industry, and government to foster technology commercialization and infrastructure development.
Third, facilitate broader access to facilities and infrastructure that can accelerate innovation. For example, take steps to strengthen the Defense Industrial Base, which now relies heavily on critical technologies in which commercial firms, high-tech start-ups, universities, and national laboratories have the leading-edge. We need shared secure spaces and research facilities in which defense systems program managers, researchers, and technology developers can conduct classified discussions and collaborative work with universities and commercial firms. In addition to federally-supported sites, systems integrators should explore the use of the authorities of the National Cooperative Research and Production Act to jointly fund and operate these secure facilities.
Fourth, prepare places for and support recovery from major technological, economic, competitive, and labor market disruptions. In times of rapid revolutionary technological change, high competitive pressure, and major economic transition—hallmarks of the era in which we live—the fortunes of places can change very quickly with plant closures, job losses, or changing skill needs. With multiple technology revolutions unfolding, and AI poised to disrupt the economy, industry, and society, more places could experience the fall-out from massive creative-destruction. These events can create losses that constitute an economic disaster. With state and Federal backing, we should leverage the Nation’s cooperative extension and technical assistance programs to help local communities prepare and execute plans for rapid recovery, economic transitions, and new job creation, for example, through R&D deployments. Funded by Federal and state governments, Economic Assistance Teams—with experts in industrial planning, finance, manufacturing, technology and innovation ecosystem development, and workforce development—would deploy to help communities experiencing serious and/or sudden economic declines and loss of economic engines. Also, participation on these teams would offer university students a chance to get real world experience.
Fifth, increase and share knowledge about fostering place-based innovation. Over the past few years, the Federal government awarded billions of dollars to develop regional technology, innovation, and energy hubs. These living laboratories presents a golden opportunity to gain deeper insights into place-based innovation. Greater study could reveal important lessons about what these coalitions did to win this funding and how they are evolving including: pre-selection and on-going planning; leadership; sources of cost-sharing; roles of state and local government, the private sector, universities, non-profits, and other coalitions; organizational and membership models; models for financial sustainability; physical assets and infrastructure involved; nature of workforce development activities; challenges, barriers, and how they were overcome; and successes and failures. In addition, such insight could help inform mission-related Federal R&D funders, many of which do not specialize in economic development, and may not consider how their investments could contribute to innovation ecosystem development.
Sixth, speed up the scaling of critical technologies. We must run faster than competitors in the race for 21st century global technology dominance; help businesses keep pace with technological and global market change; generate more economic and productivity growth; develop solutions to global challenges in climate, sustainability, food, energy, health, and water faster; and provide the U.S. military more powerful capabilities quickly. We should deepen and broaden regional access to early-stage and mezzanine financing for start-ups, business scale-up, and build-out of manufacturing operations; use pilots and demonstrations to move technologies more quickly toward deployment at scale; establish testing, piloting, and demonstration facilities and resource sharing among industry, academia, and government institutions to optimize capacity and catalyze technology deployment. The private sector should explore use of the National Cooperative Research and Production Act to co-fund and operate these facilities, with the potential of other co-funders, for example, from the Federal government. Pre-competitive consortia focused on critical technologies should engage downstream players that will ultimately be needed for commercialization and deployment at scale.
The Council on Competitiveness is doing its part through the “Competitiveness Conversations Across America.” We are convening in different regions of the country, bringing together leaders from industry, academia, labor, national laboratories, and other key stakeholders who are imagining and creating their innovation ecosystems of the future. Our goal is to uncover emerging “next” practices and policies and, in highlighting them, amplifying them for national scale-up.