Thanks to increased manufacturing exports and talented human imports, the Charleston area economy has outperformed its regional peers in recent years, according to an “economic scorecard” being released today.
But the Lowcountry metropolis must cure longstanding problems, such as inadequate transportation infrastructure, before it is on par with the likes of high-tech meccas in the Raleigh area or Austin, Texas, the third annual report commissioned by the Charleston Regional Development Alliance concluded.
“We are doing well,” alliance CEO David Ginn said this week, before quickly adding that there’s a “long way to go.”
Bryan Derreberry, president and chief executive officer of the Charleston Metro Chamber of Commerce, said the idea behind the scorecard is to help chart the way forward for local leaders while showing potential corporate prospects that the region is serious about identifying and tackling its challenges.
He likened the intensifying global competition for top-notch businesses to a difficult kayak course.
“The minute we let up there’s somebody else riding those ‘Level 5’ rapids a little bit better than us,” Derreberry said.
Headlining the scorecard is Charleston’s 8.1 percent growth in gross regional product from 2005 to 2010. While that increase fell well short of the output of goods an services in the two “leading” metro areas of Raleigh and Austin, it was nearly twice the national average and easily outpaced all six of the selected comparative cities.
The region also has seen more than 20 percent growth over that five-year period, which was above the national average. Among the cities studied in the report, that rate was second only to Savannah, which Charleston officials said was boosted by the 2005 military-realignment process.
In a related development, Charleston had a greater increase in workers in the science, technology, engineering and mathematics fields than any of the comparative or larger “aspirational” metropolitan areas.
The new Boeing Co. 787 assembly plant and the Clemson University wind-turbine testing campus under construction in North Charleston should extend that trend, said Derreberry.
“We have a new calling card today as a community,” he said of the aerospace and wind industries.
Charleston’s oft-touted quality of life indices are one of the key drivers behind the economic upticks, according to the report, which was compiled from federal data by the chamber and Clemson’s Center for Economic Development. The area’s climate and air quality in 2011 were the best of the surveyed cities.
Threatening that quality of life and the Lowcountry’s surge, however, is a product of growth itself — traffic. The lack of affordable housing near where people work contributes to that problem, and both indices are only getting worse.
The report quotes Matt Weismiller, president of medical lighting designer and manufacturer Berchtold Corp., who said “traffic congestion is now negatively impacting our employees’ commute times and overall satisfaction with their work life.”
“If this region is to remain economically successful,” he said, “investments in a world-class transportation system must be a top priority.”
Mary Graham, the chamber’s senior vice president for business advocacy and one of the principal researchers behind the scorecard, said these include the completion of Interstate 526, which the state Department of Transportation voted down Wednesday, and bigger road linkages around Boeing’s complex.
Meanwhile, Charleston’s housing-affordability index for 2010 was well below the national average and was the lowest of any of the cities in the scorecard — and that means longer commutes, more traffic and sprawl.
“It has been an issue for years, and we took our eye off the ball during the recession,” Graham said.
She said the region also needs to keep an eye on its “innovation” indicators, like the amount of venture capital investment. Charleston companies have attracted more venture capital funding than its selected peers, but nothing near the investment in longtime innovation hotbeds like Raleigh and Austin.
Between 2009 and 2011, Charleston attracted $36.6 million, which is below the national average of $182.5 million and less than 10 percent of the venture capital investment in Raleigh and Austin.
“This is a great example of how far ahead they are of our community,” Graham said, arguing that the state government must do more to encourage private investment. “We’ve got a long way to go.”
The scorecard will be followed by a trip that development alliance and chamber representatives will take to Nashville in October to learn about their schools, infrastructure and innovation ecosystem.
“We’d love to tell you we’ll be done next year,” Derreberry said of the long-term structural changes that his group and the alliance are seeking to achieve for future generations. “We’re planting trees that we’ll never collect shade under.”
Reach Brendan Kearney at 937-5906 and follow him on Twitter at @kearney_ brendan.