The next time someone calls the Midwest flyover states, attendees of the first-ever TrustBelt Conference will have the numbers and the anecdotes to swiftly educate the naysayers otherwise.
Economists, business owners, investors and more chimed in about why the Midwest is a good place to do business. Although not without its challenges, many discussions revolved around leveraging strengths, from location to the Midwest mindset, to further foster the growth of the region. Things are happening in the Midwest, and anything to the contrary is mostly a perception problem.
To kick off the three-day conference, Fate of the States author Meredith Whitney discussed the cyclical nature of the U.S. economy and how the Midwest is faring in the new post-recession cycle.
“From 2009 to date, retailers would tell you that spending within the Midwest is growing 30 percent faster than on the coasts,” Whitney says. The region also touts higher job growth, more investment in real estate, better home values, rising job creation and expanding salaries.
“This will only continue,” Whitney says.
Moody’s Economist Sophia Koropeckyj echoed Whitney’s findings in her discussion on closing the perception gap.
“The Midwest economy has not been in as good shape as it is now in 20 years,” Koropeckyj says. It has been through its fair share of restructuring, but is making a strong comeback. She says it’s time to put the past in the past and move forward on the strengths the region possesses now.
Co-founder of locally-based Drive Capital, Mark Kvamme, and Jim Winter, national director of industrial services at Cresa, joined Koropeckyj for a discussion about perceptions and regional strengths.
The seemingly national undersell of the Midwest, “It truly is purely, in my opinion, a perception problem,” Kvamme says. “What we have to do…we have to tell the message, we are not the flyover place, we are the center of where it is happening.”
Kvamme was based in Silicon Valley for his entire career before coming to Ohio four years ago. While initially met with skepticism, his colleagues still in the valley, “They are now beginning to change their tune [about the Midwest] a little bit,” Kvamme says.
The discussion determined that lower cost of living and higher quality of life make the region attractive. And, the two are advantages that could be used to potentially bring people into the region to promote growth.
Koropeckyj says that demographics are the Midwest’s biggest challenge. On the whole, the area is experiencing very slow growth. Fewer people are leaving the the region, but that’s a different story than people wanting to come to the region.
Another discussion during the conference talked about what there is to be done about these demographic challenges, and featured insights from two regionally-based entrepreneurs about how they are combating it.
Matt Scantland of locally-based CoverMyMeds and Ankur Gopal, CEO of Louisville-based tech company Interapt, both run highly successful businesses that show what is possible in the region.
For Scantland, he grew up in the area and hasn’t left, nor found a reason to do so. He finds that with his healthcare startup, a lot of the big players are already in the region, not making it unusual that CMM is based in the Midwest.
As for Interapt, “When you’re a company like ours, there’s not a ton of you in the area, it matters when you get the support, so we’ve got a lot of people rooting for us,” Gopal says. Businesses can turn that more uncommon location into an edge. For Gopal, he says it’s like being the cool guys in tech from Louisville.
Both Scantland and Gopal agree, finding the right talent can be an issue. However, Scantland makes the point that it’s hard to hire amazing people anywhere. He says talent in the Midwest might not have that high-growth experience, but that often means more retention and less turnover.
Several factors contribute to the lack of talent with the right skill sets. Koropeckyj narrows it down to employers being unwilling to raise wages to get good applicants and a cutback in training programs.
“Salary needs to be a non-issue,” Scantland says. CMM is one company that sees the benefit in closing the wage gap to get the right people. Koropeckyj predicts that more companies will do the same.
At Interapt, Gopal says that a few years ago, he wouldn’t have even considered hiring someone without a degree. But now, thanks to entities like coding schools, and the realization that driven individuals who might not have the perfect set of skills but are trainable are just as valuable, there are more ways to get talent.
While comparison to the coasts runs rampant, “We want to have what we have in the Midwest,” Gopal says. It’s not about trying to build or be the next Silicon Valley, it’s just trying to bring a strong work ethic and build a community.
The sense of community and the ability to make an impact, local governments that are excited about businesses and a good cost of living make the Midwest a strong place to build a business.