Business support project planned
By Sean Hao
Advertiser Staff Writer
Local business leaders yesterday announced plans to create a support network for Hawai'i businesses, some of which may be on the edge of folding or moving out of state.
The effort, called Project Jobs, is aimed at keeping businesses in the Islands and diversifying the state's tourism-dependent economy.
The idea behind the project, expected to formally launch next month, is to coordinate the resources of government, financial institutions, schools, community groups and others to meet the needs of businesses. This could include everything from connecting businesses to city services to finding skilled workers.
Local economic development officials agree that the state needs to focus first on existing business and second on attracting new businesses to the state.
"The reason is that over the course of a year, 70 to 80 percent of all new jobs and all new wealth creation will come from existing businesses," said Mike Fitzgerald, president and chief executive of Enterprise Honolulu, a partner in the project. "So the priority is to do everything possible to have a healthy climate for existing businesses."
According to the Small Business Association, the number of businesses with employees in Hawai'i grew to 28,569 in 2001 versus 26,881 in 1998. However the number of self-employed people dropped from 59,000 to 44,687 during that same period.
Laith Wardi, president of project consultant Business Retention Technologies Inc. in Erie, Pa., said business retention efforts are 10 times cheaper than trying to attract new businesses to an area, an effort which can include trips to the Mainland and business incentives, such as tax breaks.
Additionally, the chances of landing any of the typical 200 U.S. business relocations each year are very small.
"There are going to be a lot more losers than winners," Wardi said, noting there are about 15,000 communities competing for those 200 businesses. "That's not a good way to spend dollars."
States that provide businesses with a safety net will ultimately draw in new companies, Wardi said.
"If we are able to do that, we will make the area more attractive for recruitment," he said.
Efforts similar to Project Jobs are under way in Pennsylvania, Maryland, New York, Alabama and Washington, but there has been no clearinghouse to address business needs in Hawai'i, said Bev Harbin, coordinator for the project administered by the Chamber of Commerce of Hawai'i.
"There hasn't been a concerted effort to do business retention," she said.
Hawaii's actions have been more reactive than proactive, Harbin said.
"Everybody in the state is finally going to know somebody in the state is there to get things done," she said.
The effort will include surveying and meeting with businesses to discover their needs and goals. In addition to finding solutions to business problems, the information gathered will be collected in a database of business issues to help craft business policies for state and county government, Harbin said.
The goal is to meet with 150 businesses this year and 350 next year.
The project is financed by $70,000 in grants from the Harold K.L. Castle Foundation, the Verizon Foundation and the A&B Foundation. Another $75,000 from the McInerny Foundation is pending.
