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Portland Tribune: Business Leaders Say Portland Recovering, Rest Of State Lags

Growing concern about the state’s long and uneven economic recovery marked the Oregon Business Plan Leadership Summit held Monday in Portland.

Elected officials and leaders from local businesses and the community were thankful that Oregon’s economy finally was beginning to climb out of the depths of the Great Recession. But the leaders also expressed concern that statewide incomes are still below the national average, and that rural Oregon is largely left out of the recovery.

“We are seeing the Portland metropolitan region doing better, but our partners in the rural parts of the state are really struggling economically and we need to help them,” said Sandra McDonough, president and chief executive officer of the Portland Business Alliance, during the summit’s breakfast session on issues in the Portland area.

A new focus of the plan was on the need to reduce Oregon’s poverty rate, which at 17.2 percent is still above the national average.

“We are now creating jobs, but too many of them are low-wage jobs,” Gov. John Kitzhaber told leaders gathered for the summit.

The annual meeting was organized by the Oregon Business Council, an association of more than 40 top business executives. It is held every year to update the council’s strategy for promoting economic growth — called the Oregon Business Plan timed this year before the 2014 Legislature that begins in February. Major speakers included Kitzhaber, Oregon U.S. Sens. Ron Wyden and Jeff Merkley, and the leaders of the Oregon House and state Senate.

Also speaking was Oregon First Lady Cylvia Hayes, founder and chief executive officer of 3EStrategies, who appeared on a summit panel about reducing Oregon’s poverty rate to 10 percent by 2020.

Key strategies ahead

Among other things, many of the speakers noted the growing importance of the high-tech sector in Oregon’s economy. A report released during the summit noted that information communication technology companies in Oregon are growing faster than the state and national economy. The firms account for around 58,000 jobs in 3,000 companies, generating about $6 billion in payroll a year.

The study was commissioned by the council, the Technology Association of Oregon, and Oregon State University.

“High-tech companies have led Oregon out of the Great Recession,” said Keith Larson, Intel Capital vice president.

Three key strategies in the plan are intended to continue and increase the economic recovery:

* Building the Columbia River Crossing and funding other needed infrastructure projects around the state. Several speakers expressed confidence the 2014 Legislature will approve a state-led version of the replacement Interstate 5 bridge and freeway improvement project.

* Better connecting educational opportunities to good-paying careers as part of the ongoing school reform initiatives by Kitzhaber. Additional funding for STEM classes (Science, Technology, Engineering and Math) was a recurring theme.

* Increasing jobs in natural resources fields such as agriculture and forestry to help end rural unemployment and poverty. A new idea was generating support for food-producing businesses, much like the focus on high-tech, sportswear and sustainable development clusters.

Work isn’t done

Despite the unanimity at the summit, some of the proposals are controversial. For example, a number of environmental organizations oppose the Columbia River Crossing, taking more water out of the Columbia River for agriculture in Eastern Oregon, and current proposals to increase logging.

Council leaders noted that the Legislature mostly approved the major strategies in its most recent business plan adopted during the 2013 legislative sessions. The plan called for reforming the Public Employees Retirement System, increasing education funding and financing the Columbia River Crossing.

“We had a good year, but our work is not done,” said John Carter, chairman of both Schnitzer Steel and the Oregon Business Plan.

PERS reforms face a legal challenge from a former public employee who argues that they violate the state’s contractual obligations with retirees. Many environmental organizations are opposed to both the CRC and proposals to increase logging and take more water from the Columbia River for agriculture.

Not everyone is convinced the Oregon Business Plan is effective. One critic is Lainie Block, a Portland lawyer and advocate for more career and technical training in the public schools. She notes that such programs have been reduced at Benson High School despite calls for them to be increased statewide in previous plans.

“Unfortunately, policies are being dictated from upon high by unqualified advisers without experience in public education best practices or skin in the game,” Block says of new education reform efforts.

Summit leaders acknowledged that some factors were beyond their control. Carter expressed concern about the extreme partisanship in Washington, D.C., that prevents Congress from increasing federal infrastructure investments. And others worried that Europe is either in recession or slowly recovering from it and that China’s growth is off its historic pace, reducing the demand for Oregon-made products.

Nevertheless, they note that manufacturing is continuing to improve and that Intel, which was called “our anchor employer,” is still investing heavily in its plants in Hillsboro and Washington County.

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