Regional Performance Over Time: Lessons from the Front Lines of Growth
When the great recession hit the Bend-Redmond area of Oregon, it hit hard. The region, a popular tourist destination and a desirable place to live or have a second home thanks to its natural beauty and outdoor lifestyle, had been enjoying a huge boom in construction. Real estate prices were inflated to unsustainable levels, and at its peak, construction employment made up 11 percent of total private-sector jobs. Then the recession halved home values and construction came to an abrupt halt. With the flow of tourists slowing, and local small businesses losing their lines of credit and closing, it looked like a long climb back to prosperity — one that could have taken decades.
Instead, the region has rebounded quickly. As we found in our August 2016 report "Regional Performance Over Time: Thriving and Reviving Amid Economic Challenges," the Bend-Redmond Metropolitan Statistical Area (MSA) has outperformed its peer regions and recovered from the recession faster than other tourism-heavy "retreats." Employment is growing, housing prices have recovered, and construction has restarted, although at a more measured pace.
After hitting a low of 147 on our Best-Performing Cities index in 2011, the Bend-Redmond MSA has since climbed back to eighth place on the 2015 index. Central Oregon has adopted a collaborative, regional approach to economic development, with cities coordinating their efforts to attract and retain businesses. Although its economy still is concentrated in tourism, the Bend region has made progress in diversification, attracting data centers, for example. Meanwhile, tourism has benefited from strong growth in major metros along the West Coast, notably Seattle, Wash., and Portland, Ore.
Earlier this month, the regional economics research team here at the Milken Institute spent four days interviewing stakeholders in the Bend-Redmond region, trying to build a clearer picture of how this feat was achieved. We spoke with established and early-stage businesses, local government, civic groups, economic development organizations, and higher education institutions in our quest to identify the strategies and characteristics that set the region apart. We walked around Bend’s attractive downtown and attended Economic Development for Central Oregon's (EDCO) "Pub Talk" to see first-hand how the region’s entrepreneurs regularly network and share information. We learned about the community and the culture behind the impressive statistics. We also heard about the challenges that face the region as it tries to find a balance the demands of growth and the factors that create its high quality of life.
After supplementing our in-person interviews with more calls and research, we will summarize our findings in a case study early next year and publish them as part two of our ongoing "Regional Performance Over Time" series. Then we’ll be off to study the next region that has outperformed its peers, eventually collating a set of common themes and strategies that have aided economic recoveries in a variety of settings. These best practices should help inform policymakers in other regions looking to plan not just for growth, but also for recovery.