Resiliency, competitiveness, and innovation in Arlington, Virginia.

• Author: Hackler, Darrene

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This article is adapted from a research report commissioned by Arlington Economic Development in support of Arlington's economic sustainability initiative.

By all indications, Arlington, Virginia, is emerging from the great recession of 2008 with a very different profile than many cities in the United States. In the second quarter of 2009, the official end to the recession, the city's unemployment was a little more than 4 percent, far below the U.S. average of 9 percent. In 2009, Arlington had a population of only 206,405, but close to 220,000 jobs. According to the U.S. Census Bureau, net employment in Arlington actually increased by 4,573 in the 12-month period between March 2008 and 2009, a period when the United States as a whole shed more than 6.3 million jobs. This was a feat, even in the Washington D.C. region, with its concentration of federal government jobs, since neighboring Alexandria, Fairfax, and Prince William County all lost jobs during this period. According to Arlington officials, the city weathered the economic downturn so well because its economic base was diverse. This was accomplished by nurturing long-term economic sustainability, along with a commitment to "placemaking," a multi-faceted approach to improving a neighborhood, city, or region by emphasizing input from the people who live and work there.

In 2009, the Arlington County Board adopted its first economic development strategy, Arlington's Framework for Prosperity, which cautioned that Arlington could not remain a world-class community "without a commitment to aggressively mitigate threats and leverage growth opportunities." (1) The Arlington Economic Development Commission conceptualized this idea as "economic sustainability," but it wanted to understand the dynamics and interrelated factors that could produce ongoing economic prosperity. As a result, Arlington developed a framework that interweaves three economic values: resiliency, competitiveness, and innovation.

RESILIENCY AND ECONOMIC SUSTAINABILITY

Resiliency is more than being ready for long-term threats. It indicates that a system can recover to some workable point despite changes and hardships. In particular, resiliency suggests that economic prosperity is more likely in diversified economies than in one-company towns. From a local development perspective, "economic development can be pathological if the economic change erodes the community base or increases the vulnerability to macroeconomic fluctuations. Development programs must be designed to harbor the core community values while offering new economic opportunities." (2) Attention to resilience in economic development planning can preserve the region's economic and social integrity because it generates sustainable development "that is resistant to social degradation as well as insulated from macroeconomic fluctuations." (3)

The World Bank's Eco2 Cities Initiative also recognizes the need for long-term economic resilience in cities, in tandem with ecological care for future generations. (4) The initiative stresses that the economies of cities must not center on productivity and gross domestic product because "short-term and excessive pursuit of productivity often displaces fundamental social and cultural considerations and may undermine longer-term economic resilience." (5) Therefore, an economy would ideally have an industrial mix and diversification coming from the support of local and regional clusters. Regional clusters, one of today's prevailing economic competition models, are essentially functional innovation "ecosystems" where inventors, investors, manufacturers, suppliers, universities, and local and state governments can establish a dense network of relationships. The networks create cost and innovation advantages for cluster members by providing preferred access to markets and smoothing the exchange of technical and competitive information that can accelerate the pace of innovation, from research and development to commercialization. (6)

To build a diverse and resilient economy, the Eco2 Cities Initiative suggests that governments guide all budget decisions by assigning economic values to ecological assets and services, including the economic and social consequences of their depletion and destruction. The initiative's recommended investment and policy framework (7) makes a priority of sustainability and resilience because the approach requires longer time horizons and lifecycle cost...