02 May 2013 // Thoughts

The Business of Culture: Attracting Talent, Inspiring Entrepreneurship

Yesterday, we examined Richard Florida’s theory in The Rise of the Creative Class Revisitedthat today’s creative, knowledge-based workers often value quality of place (including the range of cultural amenities) over job opportunities and salary as relocation considerations. Indeed, Anne Markusen and Ann Gadwa write in their work, “Creative Placemaking” that nowadays “jobs follow people, rather than the other way around.” They add: “Creative places are cultural industry crucibles where people, ideas and organizations come together, generating new products, industries, jobs and American exports. They nurture entrepreneurs and expand the ranks of self-employed artists and designers who market their creations far afield and often employ others in whole or in part.”

Tammy Riddle

I spoke with Tammy Riddle, Director of Economic Development at Cincinnati USA Partnership, and Erin Kidwell, COO of Girl Develop It!, to find out how Richard Florida’s theories hold up in the “real world.” Riddle is constantly marketing Cincinnati’s assets to prospective businesses, and Kidwell not only runs a start-up, but also serves on various arts boards. While they both generally agree with Florida, they each offered their own unique perspectives on business and talent attraction and retention.

“I think Florida’s concept is essentially true,” said Riddle. “Cities shouldn’t emphasize just the incentives when dealing with prospective businesses. But from my experience, most businesses want the business case first (not incentives): can they find the right talent at the right price, the right building, access new and existing customers… that kind of thing. Then I think the other livable factors come into play as they evaluate the ability to recruit talent to Cincinnati, or if they face relocating employees. Will they be able to retain them during the relocation process? Because relocating means requesting lifestyle changes of their employees, or potential employees. In that case, the quality of life becomes a much larger factor, and the access to cultural institutions becomes a major selling point.”

Erin Kidwell

When I asked Kidwell, whose Girl Develop It! teaches computer programming to women in 16 cities, about the impact of culture assets on entrepreneurship and start-up growth, she said that accelerators usually reside in areas with major cultural assets and creative capital. “GDI is located in accelerators, incubators and startups – all of which flourish in communities with tremendous creative capital. Anywhere you see creative components – arts and cultural centers and startup culture, here comes the neighborhood.” Speaking personally, she said that because she travels all over the country on a regular basis, she doesn’t need to live in Cincinnati: “ but we just happen to be in a city that has great quality of life and cost of living.” The formula she cites is thus: cultural assets create strong friendship networks (by virtue of their value as community gathering spaces), which create pride in the community and attachment to it. Attachment to the community predicts positive perceptions of the local economy. Positive perceptions of the local economy encourage people to invest and spend locally, supporting employment.

“We entertain businesses and site selection reps all the time,” Riddle adds. “People generally accept that Cincinnati is a large business center because of Procter & Gamble, Macy’s, Kroger, etc. Cincinnati’s museums and other quality of life assets are always what blow their mind. We tell them about these amenities, but they don’t get it until they visit. They don’t expect intangibles like 21c, the Contemporary Arts Center and Cincinnati Museum Center. Those museums are intrinsic to Cincinnati and give it its flavor.” While the business case (location of clients, low business costs, profitability) is the cake, the quality of life is the icing. Both Kidwell and Riddle agreed that the ability to attract and retain talent is crucial for company growth. Businesses will look for a pool of complex problem solvers to help them innovate, and they need a community with “territorial assets” to keep these creative professionals at their companies. “Businesses may not come for the quality of life,” said Riddle. “But they stay for it.”

Museums and other cultural assets directly and indirectly employ hundreds of thousands of workers each year. They foster a community climate that attracts dynamic knowledge workers and entrepreneurs, thus creating a talent pool attractive to businesses and business accelerators. Most importantly, they give companies and employees a reason to stay, spurring a self-perpetuating culture of innovation and economic growth.

Next week, we’ll cover the final (and perhaps most obvious) impact of museums on economic growth: local, national and international tourism.