Health-tech/High-tech Shakes the Rust Off

January 10, 2017
Health-tech/High-tech Shakes the Rust Off

Growing healthcare, technology, and advanced manufacturing industries add dimension to Cleveland's Rust Belt image.

   
   

Manufacturing was the cornerstone of Cleveland’s booming economy from the late 19th to the mid 20th centuries. We earned our Rust Belt image and have learned to embrace it. But manufacturing is not the sole economic driver that it once was. Frankly, our heavy reliance on this dirty, hard work was partly to blame for our economic decline that began in the 1970s.

In contrast, today’s Cleveland is a city where advanced manufacturing is growing faster than the national average and the healthcare and healthcare IT industries are driving economic growth. Cleveland is a city that has not only regained national respect, but has earned the serious consideration of people seeking relevant and stable careers in the 21st century.

The past: Industrial manufacturing explodes, maintains momentum, then collapses

Cleveland has an illustrious history full of industrial giants such as oil mogul John D. Rockefeller and iron magnate Samuel Mather. Oil and iron solidified Cleveland's reputation as the heart of the Rust Belt.

Diverse industries related to oil and iron (such as industrial equipment and steel production) enabled the city to prosper. Yet by 1969, manufacturing had peaked and began to decline. In the early 1980s, one-third of manufacturing jobs disappeared.

As a result, Cleveland's image took a hit. Some people still have the misguided impression that this city is a dead zone for modern industries prospering in the 21st century. Nothing is further from the truth.

With roots going as far back to the mid-1800s, the healthcare industry has always had a strong presence in Greater Cleveland. Cleveland has the most concentrated area of hospitals and medical research centers in the nation. Cleveland Clinic and University Hospitals alone are the city's largest employers with a combined workforce of more than 46,000. Cleveland Clinic's main campus is essentially a city within itself, requiring its own zip code, and their physical expansion shows no signs of slowing down.

To capitalize on the healthcare industry and anything related to it, a stretch of Downtown called the Health Tech Corridor now exists. If you're looking for a career in bioscience or a meeting or convention location for this industry, this is your first stop. The 1,600-acre Health Tech Corridor is Cleveland's biomedical mecca, boasting three major healthcare institutions aside from Cleveland Clinic, four universities and colleges, more than 130 biomedical and other technology companies and eight incubators, all leasing space and providing business development services such as consultation. Led by Director Jeff Epstein, the Health Tech Corridor partners with the City of Cleveland, the Cleveland Foundation, and BioEnterprise.

Bioscience Entrepreneurship, an important facet of the healthcare industry, has helped revitalize Cleveland's tepid economy. According to Team NEO, between 1990 and 2012, the region experienced a 41 percent decline in manufacturing employment. Over the same period, however, healthcare employment saw a 55 percent increase.

That gain has stimulated growth in other careers: Professional, scientific and technical service jobs grew 27 percent. And from 2003 to 2012, exports for medical equipment devices jumped 112 percent, more than any other segment of Northeast Ohio's economy.

BioEnterprise CEO Aram Nerpouni said that the Northeast Ohio healthcare industry has attracted more than $2 billion in growth funding during the past 13 years, with more than half raised in the last five years.

Lower risk, higher return: Healthcare IT

Healthcare IT is another healthcare-related industry ripe for entrepreneurship. This industry has doubled the money they raised in 2014. Growth was so impressive, BioEnterprise CEO Aram Nerpouni called 2015 "the year of Healthcare IT."

Healthcare IT creates solutions that help the healthcare industry to comply with the Affordable Care Act, which helps them cut costs and avoid Medicare payment penalties. Additionally, Healthcare IT companies need less capital, grow quickly and make money much faster than biotech or device companies. Electronic records or analyzing data are good examples of Healthcare IT.

Many investors find Healthcare IT companies attractive because they present lower risk than traditional healthcare ventures. Healthcare IT doesn't have to contend with regulatory mandates, and the products are immune to the FDA process or reimbursement codes. Unsurprisingly, Healthcare IT professionals are in high demand.

Manufacturing is still vital to the region but has advanced

Advanced manufacturing, propelled by technological efficiencies, is the largest source of job growth in Northeast Ohio. Advanced manufacturing uses innovative technology to improve products or processes.

In this region, factories lost about 90,000 jobs since the early 1990s. However, various industry reports and local manufacturers show that growth is picking up again. With the assistance of technology, the manufacturing industry has become more productive and efficient.

Companies in Northeast Ohio make everything from food and furniture to medical devices with the latest high-tech advances in additive manufacturing and 3D printing.

Ohio Senator Sherrod Brown enthusiastically promotes advanced manufacturing. Brown is one of the lead proponents of a bipartisan bill that will allow manufacturing jobs to boost the nation's manufacturing policies, invest in innovation and connect workers with emerging industries.

Brown said, “Regional, industry-led hubs will leverage local expertise and will hopefully create thousands of high-paying, high-tech manufacturing jobs for the next generation of workers."

Many sizeable and well-established companies in Northeast Ohio are already on board. For example, employees at Parker-Hannifin's tech innovator facility in Macedonia, Ohio, have developed an exoskeleton that helps people with mobility impairments walk independently.

The future looks bright

Healthcare, healthcare IT and advanced manufacturing are leading the way to an economy poised for continued growth. Other promising industries include:

• Conventional technology, including software development across all industries
• Hospitality
• Automotive
• Energy production (the shale sector in particular)
• Infrastructure
• Workforce development
• Tourism
• Restaurant businesses
• Education

Although we proudly claim the image as a foundation to our innovation, Cleveland is no longer just a Rust Belt city. Advanced technology and a superb environment for building businesses and fostering innovation have catapulted this city into a competitive economy on the edge of national and international attention. Locals have known about the upswing for a while and are proud of the steps the city has taken to continue its rise. Now, the good news is spreading to the rest of the world.

Come see what the buzz is about in this rapidly expanding health-tech/high-tech city. Talk to one of our talented and helpful convention sales and service team members today to book your meeting, convention or site visit.

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