Birmingham punished for being in Alabama

Metropolitan Birmingham
Metropolitan Birmingham (Wikipedia)

One of the greatest obstacles to metropolitan Birmingham’s growth is too many competing governments, but that’s not the only deterrent.

Being located in Alabama is also an obstacle.

The Birmingham Business Alliance (BBA) publishes a report that compares key economic figures of metropolitan Birmingham to eleven peer cities.

In my opinion, the most important of these key metrics is job growth.  And metropolitan Birmingham has no more jobs than they had before the recession.

The BBA points out that we have improved in the rankings from 12th (last) in 2001-2010 to 8th in 2010-2014.

That does sound like we’re doing better, but let’s take a closer look:

2010-2014 Annual Average Employment (Source: U.S. Bureau of Labor Statistics, March 18, 2015

Austin +17.2%
Nashville +14.9%
Raleigh +11.9%
Charlotte +11.7%
Atlanta +9.9%
Oklahoma City +9%
Louisville +8.2%
Birmingham +4%
Memphis +3.8%
Huntsville +3.5%
Montgomery +1.3%
Mobile -.1%
Alabama +2.8%

Note all the poor performing cities are in Alabama except Memphis. (Memphis defeated a government consolidation election in 2010 and suffers from many of the same governance issues as Birmingham).

And should we really be comparing ourselves to Huntsville, Montgomery, and Mobile–all in our Alabama family?  Are they really our peer cities?

Why haven’t Alabama cities been able to grow jobs?

There are the obvious reasons why Alabama cities are stagnant.  Our State suffers from poor education, low income, lack of support for public transportation, an outdated constitution, and unfair taxes.  (Note that citizens who live in Tennessee and Florida do not have to pay personal income taxes. If you are a CEO looking to move your company—no income tax is pretty compelling)

And there is one more critical factor.

Leslie Berlin explains in her book, The history of Silicon Valley and why it remains such a powerful economic generator, how Silicon Valley was born and why it continues to prosper.

Ms. Berlin says there are many reasons for Silicon Valley’s success, but one of the most critical is immigration…

 “It is impossible to overstate the importance of immigrants to the region and to the modern tech industry. Nearly 37 percent of the people in Silicon Valley today were born outside of the United States…Half of Silicon Valley households speak a language other than English in the home. Sixty-five percent of the people with Bachelor’s degrees working in science and engineering in the valley were born in another country…

 … From 1995 to 2005, more than half of all Silicon Valley startups had at least one founder who was born outside the United States.[13] Their businesses — companies like Google and eBay — have created American jobs and billions of dollars in American market capitalization.”

The people of Alabama have made it clear that many immigrants are not welcome.  I know the animosity is towards illegal immigration, but we often seem to give the impression that we don’t welcome people who don’t look, act, or think like us.

And that’s a shame because our north Alabama region has the makings of a Silicon Valley-like tech corridor. Birmingham is anchored by UAB; we have over 700 high tech companies (according to BBA); we have a vibrant Innovation Depot; and Huntsville, our neighbor to the north, is home to many high tech companies including HudsonAlpha.

Birmingham has many challenges and being located in Alabama is another one.

Let’s turn Birmingham around.  Click here to sign up for our newsletter.  There’s power in numbers. (Opt out at any time)

David Sher is the publisher of ComebackTown, a co-founder of Buzz12, a division of Intermark Group, and co-CEO of AmSher Compassionate Collections.  He’s past Chairman of the Birmingham Regional Chamber of Commerce (BBA), Operation New Birmingham (REV Birmingham), and the City Action Partnership (CAP).

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4 thoughts on “Birmingham punished for being in Alabama”

  1. *I hate to nitpick, but the choice of some of your wording seems like you’re insinuating that merely being located in the state of Alabama is why Birmingham, as opposed to more properly stating what I think you are trying to say that the lack of prosperity in Birmingham is largely due to the failed policies of elected city officials and elected state officials. 

    Birmingham hasn’t prospered because it’s elected officials are too busy jetting off to the Vatican or somewhere (it’s so bad that I distinctly remember a City Council meeting being called off because too many council members were off vacationing outside of the state) and seemingly don’t care about the denizens of the Magic City. The City has also decayed due to bickering over policies and the lack of home rule at the state-level.

  2. When it comes to economic development, one of the better explanations of late is provided in Why Nations Fail (2012) by Daron Acemoglu and James Robinson, which examines the question on a global scale, comparing adjacent territories with disparate economic growth rates. It’s no accident that the Alabama Constitution of 1901 makes a cameo appearance.  The explanation is worth reviewing, since the economic development pattern that is identified is still present.  One can save some time by trying to figure out who the key players are in each city.  In general, the harder that is to do, the higher the numbers are.

  3. We
    can’t move Birmingham to another state so we need to find solutions to our real
    problems. I suggest the real problem is two-fold. The first is lack of
    integrity in our elected officials. Two cases in point:

    1.    Governor Robert Bentley was
    twice elected on a “no new taxes” platform. Within a few weeks of his
    re-election he said we need to raise taxes by $500 to $700 million dollars.
    Recently he has stated the real problem is our 2-budget system and we need 1
    consolidated budget. Did these conditions exist prior to his first election?
    Yes! Why did he not raise these issues during either of his two election
    campaigns?

    2.    Dr. Ray Watts is Chairman
    Elect of the Birmingham Business Alliance. This is occurring after he killed
    UAB Football and two other sports. It is well documented that he was disingenuous
    in when and how the decision was made. It is also well documented that he
    received a no confidence vote from every group involved in running and
    supporting the university. How can a person lacking in integrity be a leader
    for any organization?

    David,
    you also stated, “Our State suffers from poor education, low income, lack of
    support for public transportation, an outdated constitution, and unfair taxes.”
    My question is, “Who is responsible for all of that?”

    Poor
    education, lack of support for public transportation, outdated constitution and
    unfair taxes are the responsibility of our elected officials. When they fail to
    tell the truth people lose confidence in their ability to lead effectively.

    Low
    income is the responsibility of the companies that do business in the area. If
    they want their people to have more disposable income and a higher standard of
    living let them pay their employees more money. Many of the CEOs in this area
    are making millions in salary, benefits, and stock options while their employees
    – who are essential to their success – remain underpaid.

    Illegal
    immigration takes away employment opportunities from American citizens. I doubt
    that anyone objects to legal immigrants that make a positive contribution to
    society and enhance our way of life. There are many doctors, scientists,
    computer scientists, etc., that live and prosper in our city and state.

    Secondly,
    I blame the media. There is a tendency to publicize the negative and ignore the
    positive. My challenge to the media is to go one day a week and publicize only
    positive news.  

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