What is Economic Resilience?

This post is the first half of a series discussing economic resilience. It offers some definitions of economic resilience and outlines resiliency initiatives. CEDR is spotlighting economic resiliency because it will be the focus of Georgia Tech’s 2017 Basic Economic Development Course — Economic Resilience: Building Capacity for Strong Communities (March 21, 2017-March 24, 2017). For more on the course, watch this short video or visit www.gt-bedc.org.

The National Association of Counties (NACO) describes economic resilience as a community’s ability to foresee, adapt to, and leverage changing conditions to their advantage. Similarly, the U.S. Economic Development Administration’s (EDA) Comprehensive Economic Development Strategy (CEDS) Content Guidelines note that resiliency has three primary attributes:

• The ability to recover quickly from a shock;
• The ability to withstand a shock; and
• The ability to avoid the shock altogether.

Shocks may include:

• Downturns in the national or global economy impacting demand for local goods and spending;
• Downturns of particular industries critical to local economic activities; and
• External impacts such as natural or man-made disasters, military base closures or a major employer, changing climate, etc.

Though the Great Recession is in the rearview mirror, it is during the relatively prosperous times that communities need to keep their focus on resiliency efforts. Communities should prepare because economic shocks are always waiting around the corner. Since shocks are inevitable, as EDA notes, a region’s long-term economic prosperity is linked to its ability to deal with disruptions to its economic base.

Economic developers play an important role in building a community’s economic resiliency. They must consider their role from the pre- and post-incident perspective. As a result, their strategies for economic resiliency fall into two camps defined below.

Steady-state Initiatives

These are pre-incident initiatives that focus on long-term efforts to improve the community’s ability to withstand or avoid shocks. Some examples include:

• Comprehensive planning efforts that incorporate a vision for resiliency;
• Implementing efforts to diversify the industrial base;
• Adapting business retention programs to assist firms with recovery following a shock;
• Developing a workforce that can shift between jobs and industries;
• Using geographic information systems (GIS) to map business establishment data and available development sites, integrated with hazard information to allow for rapid post-incident impact assessments;
• Ensuring redundancy in communication networks to protect commerce and public safety;
• Promoting business continuity by ensuring businesses understand their vulnerabilities, such as their supply chains, in the face of disruptions; and
• Employing safe development practices, such as locating structures outside of floodplains, preserving natural lands as buffers, and protecting existing development from extreme weather.

Responsive Initiatives

These are post-incident initiatives that focus on a community’s ability to react in the short-term to shocks and recovery needs. Some examples include:

• Pre-disaster recovery planning that defines key stakeholders, roles, responsibilities, and actions;
• Developing a system for regular communication, monitoring, and updating of business community needs for use after or during an incident;
• Establishing the capability to rapidly contact key officials (local, regional, state, and federal) to relate business sector needs and impact assessments; and
• Creating coordination mechanisms and leadership succession plans for short, middle, and long-term recovery needs.

Sources

Note this discussion draws from the 2016 Georgia Economic Outlook Report prepared for the EDA University Center program, operated by Georgia Tech’s EI².

National Association of Counties (NACO). (2013). Strategies to Bolster Economic Resilience. Retrieved from: http://www.naco.org/sites/default/files/documents/Strategies%20to%20Bolster%20Economic%20Resilience.pdf.

United States Economic Development Administration (EDA). (2016). Comprehensive Economic Development Strategy (CEDS) Content Guidelines. Retrieved from: https://www.eda.gov/ceds/.