Interview with Jay Williams, Assistant Secretary of Commerce for Economic Development

Jay Williams was the mayor of Youngstown, Ohio, from 2006 to 2011, at a time when Youngstown was attracting notoriety for making the unusual assertion that, rather than longing for its bygone glory days before the steel mills closed, it was going to embrace a vision of becoming a smaller, yet more vibrant city. (See Shelterforce’s “Small Is Beautiful, Again”, for more on this approach and how it affects low-income residents.) Williams is now assistant secretary of commerce for economic development, and administrator of the Economic Development Administration. Prior to joining the U.S. Department of Commerce, Williams served as the executive director of the Office of Recovery for Auto Communities and Workers, and he also served in the White House as deputy director for the White House Office of Intergovernmental Affairs. In this position, he led efforts to engage mayors, city council members, and county officials around the country.

Shelterforce spoke with Williams at the conference of the National Alliance of Economic Development Associations last fall in San Antonio.

Harold Simon: You left Youngstown [as mayor] three years ago, where you did some courageous things.

Jay Williams: We tried.

Harold Simon: What were things you learned that you would like brought to the federal government, or would like to see more communities do?

Jay Williams: It was interesting to understand the length of time that Youngstown struggled with its loss of its defining industry. There was an impact in terms of the actual measurable challenges of the community, whether it was decline in tax base, decline in population, [or] the challenges to the neighborhoods. But, [what] was often underestimated [was] the psychological impact that has on a community. The Harvard Group did a study, and a book was written, Waiting For the Future.

It took a community 25 years to realize that things were going to be different, that smaller didn’t mean inferior, [and] that we had a lot of assets that remained in the community. That was one of the lessons I tried to bring to the Auto Recovery Office, dealing with communities that were being reshaped by a defining entity. A lot of communities were stuck in that same vein of, “Well, it’ll come back. We don’t want to redevelop the property because, if we just wait long enough, something may come of it.” [In] two or three or five instances out of 100, one of the OEMs [original equipment manufacturers] did decide to reinvest [and] something did fill that void. But it was such an infrequent occurrence, [and yet] communities would hold onto that.

Part of what I hope[d] to bring were the lessons that you have to move on, and what that means in terms of the community’s perspective.

My election didn’t run on, “Hey, we’re going to be bigger, we’re going to go back to the good old days, and Youngstown’s going to hold 108,000 people.” It was, “A smaller community is OK. It’s more nimble, diverse. We are still relevant in terms of the region, but we have to do things different.”

[We] made some significant investments in Youngstown that people didn’t realize how relevant they [would be] to where the community is now.

Harold Simon: What kind of investments?

Jay Williams: Particularly the Youngstown Business Incubator. It was fledgling 15 [to] 20 years ago, doing traditional business incubation services that evolved into focusing on business-to-business technology companies. Two months ago [it] was named the number one university-affiliated incubator in the world [and] has been part of the transformation from a purely manufacturing community to one [in which] manufacturing is still very relevant, but now is involved in innovation, data, and IT.

That investment is demonstrative of EDA’s role in helping a community move along that economic continuum. As we travel the country and see communities and instances where EDA has made strategic investments, they can begin to share best practices of what works and what doesn’t work.

Harold Simon: Where do small and local business, cooperatives and ESOPs, fit in your view, either in Youngstown or more broadly in creating jobs and opportunity?

Jay Williams: From an economic development standpoint, there is an opportunity for significant growth, and it’s a lower barrier of entry for those individuals who want to become job creators. Where EDA comes in is [in] those communities that have decided that that is an approach they want to embrace. We can provide technical [and] planning assistance. Our role at EDA is working with the elected officials or the nonprofit entity that is a part of that larger strategy; we really don’t have [a] direct relationship with the entrepreneurs themselves.

The local community decides that they ultimately want an environment that is very appealing to small businesses, entrepreneurs, and we are agnostic with respect to the structure.

Harold Simon: States compete with each other for manufacturing companies, and very often, that competition doesn’t do, in the long run, what they thought it would do. Is there a role for the federal government in helping them think better?

Jay Williams: I think the IMCP [EDA’s Investing in Manufacturing Communities Partnership] approach is one that encourages collaboration within regions, not respective of state borders, because economies don’t exist neatly within state borders.

A good example is Northeast Ohio and sort of Southwest Pennsylvania; that’s a porous border. Another is the Cincinnati–Northern Kentucky area. Those are examples where I’ve seen states determine that it is not in their best interest to compete.

The Southwest/Southern Ohio region, which encompasses Dayton, Cincinnati, [and] Northern Kentucky, was listed or designated as one of the 12 IMCP communities. Those regions that decide that’s how they want to present themselves are going to be rewarded.

The decisions have to be made by local stakeholders, and to the extent that we can provide incentives or enhancements to do that, we’re not going to be punitive, but we want to make sure that those practices are rewarded and lifted up.

Harold Simon: There’s been a lot of talk about the knowledge economy, but you don’t necessarily have to have a four-year degree and a master’s to get a well-paying manufacturing job. Can you talk about the implications of green jobs and [their] potential to allow people who may not have engineering degrees to actually get the kind of jobs you were describing?

Jay Williams: The Secretary of Commerce, Penny Pritzker, for the first time in the history of the Commerce Department, has elevated those workforce skills as a priority within commerce. That is something that has historically been led by the Department of Labor through the Employment & Training Administration. But employers are saying that [accessing their new jobs] doesn’t require a four-year degree, or an advanced degree, or even a technical degree, but the demands and the skills that are necessary certainly exceed what you would typically get in a high school diploma.

This administration has been focusing investments on employer-driven training programs, training programs where the curriculum is designed around the needs of employers that are there from the very beginning, bringing in community colleges [and] technical schools. Now we’re seeing that permeate down into high school, and even junior high school. When we were in school, they used to call it “shop class.”

Part of that is getting away from this notion that it’s something to fall back to, but instead it’s something to aspire to, [and] creating [a] pipeline of opportunity for individuals to get skills that allow them to be gainfully employed.

Harold Simon: Can you say a few words about the notion of equity and how an economy that works for everyone is actually a stronger economy?

Jay Williams: A core part of the president’s agenda is making sure that we have an economy that provides ladders of opportunity. I think he [President Obama] said it best when he said a family shouldn’t have to work two and three jobs and still be at the poverty level, or just barely able to get their head above the poverty level.

Having an economy that provides a ladder of opportunity for those who are not in the middle class to climb into the middle class, and for those who are in the middle class to be there comfortably, and even take risks to become [an] entrepreneur, to perhaps even move up beyond that goes to [the fact that] while it’s not necessary for everyone to go to college, college still provides a great opportunity. [We need] college affordability, making sure [it] doesn’t become an elitist opportunity only for those who have the greatest amount of wealth or resources.

Manufacturing provides a great opportunity to climb into the middle class in a way that doesn’t require, necessarily, a four-year degree. [Comparing] individuals with very similar skill sets—one who happens to be working in manufacturing, one who happens to be working in another segment of the economy—the person working in manufacturing generally makes 15 to 20 percent more, [and] entry-level wages for manufacturing jobs are upwards of 30 percent more.

Harold Simon: How does thinking about people who have been excluded from a lot of the opportunities that other people have factor into the EDA’s work?

Jay Williams: Our work and our mission [are] geared toward economically distressed communities, so, by definition, when we talk about people [who] have been excluded, many of them are at the core of the areas where we work. But it’s not us saying, “This is what we think is best,” or “This is what we found to be most beneficial to these particular communities.” Communities have to make a determination of where their priorities are [and] how they want to provide inclusive opportunities. One of the great things about EDA is our flexibility. There’s a high degree of flexibility in resources that we provide [and] the programs that can be tailored to the priorities of those communities. [For example,] if a community decides it’s infrastructure they need, we have the ability to make those infrastructure investments.

One of the other things that we do well is [to] say, “These are communities that have experience, positive impacts, by taking this approach. Why don’t we connect you with them?”

Harold Simon: What would you like to see institutionalized in the EDA so that if another administration comes in, maybe [with] a different agenda, it’s part of the fabric of the organization that isn’t there now?

Jay Williams: The mission of EDA is communicated through the public works legislation that was the creating legislation of EDA. I think the best thing that we can do as current leadership is to focus on the inner workings of EDA, making sure that the things that go on behind the scenes work efficiently in terms of staffing [and] operational structure. This administration has elevated the work of EDA in ways that we haven’t seen in a long, long time. We’ve seen administrations in the past that wanted to do away with EDA, but [it] survived because [in] those communities that EDA works with, whether they have Democrat or Republican, very liberal or very conservative representatives, it is clear that creating economic opportunity by making investments that are ultimately leveraged by the private sector is something that enjoys widespread support.

Harold Simon: You’re someone who has found support on both sides of the aisle. You got wonderful accolades from both Republicans and Democrats.

Jay Williams: I appreciate my home state senators, Rob Portman, a Republican, and Sherrod Brown, a Democrat. EDA is about engaging local elected officials, engaging grassroots, and there isn’t a Democrat or Republican way to help create economic opportunity. When the testimony comes from the stakeholders, that’s the best thing you could ask for. Obviously I’m going to be very biased about the mission of EDA, but that’s much less relevant versus a testimony from a mayor, a council member, or [a] nonprofit that says, “but for EDA’s investment. . . .” And there are dozens of instances that we can point to that say we don’t have to tell our own story. We’ll let those who have benefited from EDA’s presence do that for us.

Excerpt from William’s speech to NACEDA, the National Alliance of Community Economic Development Associations:

For far too long, the federal government made workforce development investments that were training for the sake of training. “Here’s money, put on the training program, get your certificate, and we wish you well.” And what we were finding out is that the training that was going on wasn’t necessarily matching the skills that were needed by the employers. So the Obama administration made it a point that, when we’re making workforce investment decisions, that the employers need to be involved at the very beginning, saying these are the skills that are in need right now, and these are the skills that we project that we’ll need over the next several years.

So, bringing the employers into the equation, bringing the community colleges and other nonprofits into the equation, and then making federal investments in workforce programs has yielded a significant benefit. We have seen a transformation of our workforce development investments. It was manifest in the recent passage of the Workforce Innovation and Opportunity Act, and it’s something that, for the first time in the history of the U.S. Department of Commerce, Secretary Pritzker has raised as one of the priorities.

The last thing that I’ll touch on as a priority is we’re also working to help facilitate entrepreneurship. We can help facilitate and promote entrepreneurship through our investments in business incubators and business accelerators; that is something that EDA has also been involved in for a long period of time. As a matter of fact, within EDA, there’s an Office of Innovation and Entrepreneurship headed by a former entrepreneur who is charged with helping to direct our investments.

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