GLOBAL CITIES INITIATIVEA J O I N T P R OJ ECT O F B R O O K I N GS A N D J P M O R GA N C H AS E

Houston, TX / May 15, 2013@bruce_katz #globalcities

10.2 millionjobs needed

More Jobs

81 millionpoor or near poor in 2000

More Jobs & Better Jobs

107 millionpoor or near poor in 2011

More Jobs & Better Jobs

A vision for the next American economy

1 2 3

1

2 3

The next economy will be largely metropolitan

1 2 31

2

3

1 2 31 2

3 Metropolitan areas are driving innovation

METROINNOVATION

A vision for the next American economy

1 2 3

1

2 3

2009

Global GDP

19.9%US

21.0%BIC Countries

Source: International Monetary Fund, World Economic Outlook Database, April 2010

2015

Global GDP

26.5%BIC Countries

17.9%US

Source: International Monetary Fund, World Economic Outlook Database, April 2010

Global Metro Population

2009

50%

Global Metro Population

2030

60%

Source: UN Department of Economic-Social Affairs, World Urbanization Prospects, 2009

Economic Performance2011 - 2012

Highest Performing MetrosLowest Performing Metros

Source: Brookings, Global MetroMonitor, November 2012

Exports Share of GDP2010

13%

United States

29% 22%

15%

30%

Japan

China Canada India

European Union

15%

Source: Brookings analysis of WTO and EIU data, 2011

Transport Networks are Clogged and Congested

Can we get back into the export game?

billionUS manufactured exports 2010

$944

Japan

$680$944

United States GermanyFrance

$409

China

$1477

$1091

Top Manufacturing Exporting Countries2010, Billions

Source: World Trade Organization, 2011

$358

ServiceImports

ServiceExports

$518

US Service TradeBillions, 2010

$160 billiontrade surplus

Source: World Trade Organization, 2011 (Data reflect Commercial Services)

Can the U.S. play in thelow carbon revolution?

Sources: Brookings-Battelle Clean Economy Database (2011)

2.7 millionclean economy jobs

1.4 millionbiosciences jobs

4.8 millionIT jobs

2.4 millionfossil fuel jobs

2.7 millionclean economy jobs

Sources: Brookings-Battelle Clean Economy Database (2011), Brookings Analysis of Battelle, BLS, Moody’s Analytics data

$53.9 billionclean economy exports

Source: Brookings-Battelle Clean Economy Database (2011) and Moody’s Economy.com

$53.9 billionclean economy exports

NationalEconomy

$10,392

Export IntensityYearly Export Earnings per Job

$20,124

Clean Economy

Source: Brookings-Battelle Clean Economy Database (2011) and Moody’s Economy.com

35%manufacturingshare of engineers

68%manufacturing share of R&D

35%manufacturingshare of engineers

Source: EOP “A Framework for Revitalizing American Manufacturing” (2009)Brookings “Accelerating Advanced Manufacturing with New Research Centers” (2011)

90%manufacturing share of patents

68%manufacturing share of R&D

35%manufacturingshare of engineers

Can the U.S. be anInnovation Nation?

US Names China On Intellectual-Property Watchlist

China's insufficient protection of intellectual property rights remains a top priority for U.S. trade policy, given the "troubling" direction of recent government measures aimed at supporting domestic innovation, the U.S. Trade Representative's office said Monday.

China Begins to Lose

Edge as World’s Factory

FloorJanuary 16, 2013

BEIJING - China is losing its competitive

edge as a low-cost manufacturing base, new

data suggest, with makers of everything

from handbags to shirts to basic electronic

components relocating to cheaper locales.

The shift - illustrated in weakened foreign

investment in China - has pluses and

minuses for an economy key to global

growth.

Shale Gas Fuels U.S. Manufacturing RenaissanceJanuary 10, 2013

Abundant, affordable domestic natural gas is helping to revitalize energy-intensive industries like petrochemical manufacturing.

“Looking back 20 years, chemicals were out nation’s top export product. But as recently as five years ago, we were on the verge of becoming an importer. Now the industry is back.

January 19, 2013The number of firms known to have “reshored” manufacturing to America is well under 100. Doubtless many more are doing so quietly. Examples range from the tiny, such as ET Water Systems, to the enormous, such as General Electric, which last year moved manufacturing of washing machines. fridges, and heaters back from China.

Reshoring Manufacturing: Coming Home

11%wage premiumin exporting firms

Source: Istrate, Rothwell & Katz, Export Nation (2010)

Greater likelihood of health and retirement benefits in export-intense industries

The U.S. must get smart...

fast

Source: US Census Bureau, 2010 American Community Survey

Hispanics

19%

African Americans

Non-Hispanic Whites

Asians

25%39%

56%

Educational AttainmentAssociate’s Degree or Higher

United States

36%

Source: US Census Bureau, 2010 American Community Survey

Hispanics

19%

African Americans

25%

Educational AttainmentAssociate’s Degree or Higher

The next economy will be largely metropolitan

1 2 31

2

3

Source: Brookings analysis of US Bureau of Economic Analysis data

TexasAustin, Dallas, El Paso, Houston, McAllen, San

Antonio

Population GDP

71% 74%

TexasAustin, Dallas, El Paso, Houston, McAllen, San

Antonio

Population GDP

Corpus Christi, Brownsville, Killeen, Beaumont, Lubbock, Amarillo, Laredo, Waco, College Station, Longview, Tyler,

Abilene, Wichita Falls, Odessa, Midland, Sherman, Victoria, San Angelo, Texarkana

88% 89%

Service Exports

75%63%

Manufacturing Exports

Population

66%

Top 100 Metro ExportsShare of U.S. Totals

Source: Brookings, ExportNation 2012

Top 100 Metro Exports

Chemical Products

68% 76%

Business/Professional

Services

Computer/Electronic Products

78%

Population

66%

Share of U.S. Totals

Source: Brookings, ExportNation 2012

Top 100 Metro Trade Logistics

U.S. Air Cargo Weight

82% 88%

Foreign Waterborne

Cargo Weight

Airline Boardings

92%

Population

66%

Share of U.S. Totals

Source: Brookings analysis of US Census Bureau, FAA, and PIERS data (2009)

Aerial imagery: © DigitalGlobe, GeoEye, Sanborn, USGS, USDA FSA

217,527

US HoustonMetro

ManufacturingIntensity

8.5% 8.5%

Manufacturing JobsTop Manufacturing Sectors

Houston, TX Metro Manufacturing Dashboard

Fabricated Metals 20.9%Machinery 19.5%Chemicals 15.3%Computers & Electronics 8.4%Petroleum & Coal Products 5.8%

US HoustonMetro

Manufacturing Growth

2010 Q1 - 2011 Q4

2.7%

5.9%

Source: Brookings, Locating American Manufacturing 2012

$47.9 B

Top 100Metros

HoustonMetro

Export Intensity

9.8%

14.0%

Export VolumeGoods & Services Exports

71.9%goods share of exports

Houston, TX Metro Export Dashboard

307,000Export Jobs

28.1%services share

of exports

Top Services SectorsTop Services Sectors

Travel and Tourism 8.9%

Business Services 6.9%

Royalties 5.6%

Top Manufacturing SectorsTop Manufacturing Sectors

Chemicals 20.3%

Machinery 15.1%

Petroleum and Coal Products 14.9%

Source: Brookings, ExportNation 2012

Houston, TX Metro Export Dashboard

Source: Brookings, ExportNation 2012

Houston’s Top Export DestinationsBy 2010 Volume (in millions)

Canada

Mexico

Japan

United Kingdom

China

$7,491.5

$5,157.8

$2,635.4

$2,358.2

$2,289.5

Germany

Brazil

South Korea

Singapore

Netherlands

$1,853.3

$1,724.3

$1,678.4

$1,467.3

$1,323.4

Houston, TX Metro Global Aviation Dashboard

Source: Brookings “Global Gateways: International Aviation in Metropolitan America” (2012)

Share of Houston Passenger Air Travel to Major Global Regions

By 2011 Total Passengers

Houston’s Top Air Travel ConnectionsBy 2011 Total Passengers

Latin America/Caribbean

Western Europe

Developing Asia/Pacific

45.8%

Rest of World

19.6%

10.2%

24.4%

Mexico City 311,849

London

Calgary

Cancun

Monterrey

227,883

139,285

130,974

110,365

Houston, TX Workforce Dashboard

Sources: Brookings, State of Metropolitan America (2010), Geography of Immigrant Skills (2011), Demand for H-1B Immigrant Workers in US Metros (2012)

29%36%

16%

Job Openings

All Adults

Unemployed Workers

Bachelor’s Degree Attainment by Industry

46% 43%

Energy Healthcare

18%Houston

Employment

Immigrant Skills Gap

22.3%immigrant

share of population

11thof 100 metros

High SkilledLow Skilled Middle Skilled

42.6% 43%

30%28%35.1%

22.3%

Immigrant SkillsAge 25+

US Houston US Houston US Houston

Skills Gap

Job Openings Requiring, and

Adults Possessing, Bachelor’s Degrees

1 2 31 2

3 Metropolitan areas are driving innovation

METROINNOVATION

Innovate Locally

Market AssessmentTarget Sectors

8% 9%12%

Economic Profile15%

12%

13%

9%

Establish Goals & Strategies

Boost SME exportsIncrease global fluency

Double exports Support key sectors

Governments

Philanthropy

Firms

Universities

Collaborate to CompeteLos Angeles

Minneapolis-Saint Paul

PortlandSyracuse

Metropolitan Export Planning

Metropolitan Export Planning

Portland

Target industries: computers and electronics, clean technology & innovation

Goal: Double exports in the next five years

Strategies:

1. Leverage primary exporters in computer and electronics

2. Catalyze under-exporters in manufacturing

3. Improve the export pipeline for small business

4. “We Build Green Cities” - brand and market Greater Portland’s global edge

Metropolitan Export Planning

Portland

Target industries: computers and electronics, clean technology & innovation

Goal: Double exports in the next five years

City of PortlandMayor’s Office

Los Angeles

Metropolitan Export Planning

Strategies:

1. Establish the Los Angeles Regional Export Council

2. Target high-opportunity market segments

3. Market the Los Angeles region to the world

Target industries: aerospace, computers and electronics, pharmaceuticals, film and television, professional services

Goal: Double exports in the next five years & foster more globally-fluent, export-oriented business culture

University ofSouthern California

University of California Los Angeles

City ofLos Angeles

Los Angeles Regional Export Council

Los Angeles

Metropolitan Export Planning

Target industries: aerospace, computers and electronics, pharmaceuticals, film and television, professional services

Goal: Double exports in the next five years & foster more globally-fluent, export-oriented business culture

The United States Conference of Mayors

“Export Ready”Challenge

Houston

Build on Metropolitan Houston’s Strengths

Target industries

Goals

Network

Strategies

Metropolitan Export Planning Metropolitan Houston

Export Plan

Building a 21st Century Workforce for the Houston Region Goal: Develop comprehensive workforce

strategy to tackle challenges in the Greater Houston Region

GHP Workforce Development Taskforce

Houston

Innovate Locally Advocate Nationally

PennsylvaniaCenter for Trade & DevelopmentState Governments

22 foreign tradeoffices

firms assisted with exports1,350

new exports from assisted firms, 2010$483 m

FloridaEnterprise Florida

12 internationaloffices

$3 b state GDP added from export assistance & business development in 2011

State Governments ColoradoSpace Cluster

4 states joining Colorado to advocate for and promote space cluster initiatives

$20m competitive matching grants for early-stage tech development in CO

OhioThird Frontier & Edison Tech Centers

7 regional centers providing innovation & commercialization services

to foster innovation ecosystem in Ohio 2010-2016

$700 m

Reform Immigration for

CompetitivenessOpen NewMarkets

Free Trade AgreementFree Trade AgreementFree Trade Agreement

Federal Government

Modernize & Prioritize Trade

Corridors

National Freight Strategy

Trans-Pacific Partnership

Europe

ExportFinancing

InternationalMarket

Intelligence

International Trade AdministrationExport-Import Bank

Innovate Locally Network GloballyAdvocate Nationally

New York

Sao Paulo

Toronto

Lagos

Sydney

Tokyo

Shanghai

London

ParisFrankfurt

Detroit

Monterrey

Bogota

Johannesburg

Cologne

ChennaiHanoi

Chongqing

Houston

Singapore

Calgary

Rio de Janeiro

Daqing

Perth

Dubai

Stavanger

Xi’anDelhi

Antioch

Tyre

Samarkand

Lanzhou

Baghdad Tehran

GLOBAL CITIES INITIATIVEA J O I N T P R OJ ECT O F B R O O K I N GS A N D J P M O R GA N C H AS E

Houston, TX / May 15, 2013@bruce_katz #globalcities