BioDistrict New Orleans

An Economic Engine for Southeast Louisiana

Despite an Uncertain Economic Future, the Biosciences are a Growing Force in Louisiana
The American economy is in a state of flux. The halting, uneven recovery of the past few years has restored some of the

jobs lost during the Great Recession, but unemployment remains stubbornly high. There is also considerable uncertainty and debate about what the economic future of the United States looks like. While buffered from the worst effects of the national economic downturn, Louisiana faces many of the same questions about its economic future. Louisiana has not experienced the recent economic lows that other states have, nor has it shared in major upswings over the past 25 years. Indeed, even prior to hurricanes Katrina and Rita in 2005, Louisiana was one of the slowest growing states in the country. Louisiana needs a new economic identity if it is to prosper once again.

% Change In Population, 1990 - 2005

Even before the displacement caused by hurricanes Katrina and Rita, Louisiana was the slowest growing state in the Southeast. New industries must be cultivated to restore economic prosperity. Source: Census Bureau

In the context of so much economic uncertainty, the biosciences are a strong economic investment. Consider the following: Over the 10 year period ending in 2010, employment in the biosciences is estimated to have grown by 2.9% annually nearly twice the rate of growth of employment overall1. Bioscience workers, on average, are paid at least $18,600 more than the overall national average wage2. The biosciences offer high-paying, quality jobs across a range of occupations from lower-skilled technicians and manufacturing workers to high-skilled research scientists and medical doctors. The biosciences contribute to the growth of other technology sectors, such as information technology, electronics, optics A growing senior population will drive demand in the biosciences in the coming years. and advanced manufacturing. Investments in the biosciences can lead to benefits for residents in terms of a cleaner environment, healthier foods, and improved health carea particularly valuable contribution given the aging of the population. An estimated 10,000 baby-boomers are reaching age 65 every day3.

The biosciences are not an economic panacea for Louisiana or the nation, but they will likely be a robust economic driver for many years.

1 2 3

Source: Biotechnology Industry Organization (BIO), Laboratories of Innovation: State Bioscience Initiatives, 2006; analysis of Bureau of Labor Statistics data Source: ibid., analysis of 2003 wage data Source: James Brooks, National League of Cities, A Time of Transformation in Housing and Transportation. January 30, 2012. www.nlc.org

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BioDistrict New Orleans

An Economic Engine for Southeast Louisiana

Southeast Louisiana Has the Building Blocks for a Thriving Biosciences Economy
What is particularly intriguing about the economic potential of the biosciences is that Southeast Louisiana already has the foundations in place to become a significant biosciences hub. Consider the range of assets that the Southeast Louisiana super-region already boasts:

Bioscience Jobs as % of All Jobs, 2010

The biosciences already have a substantial economic footprint in Louisiana, accounting for In comparison to other states in the Southeast, Louisiana already has a large con245,000 jobs or 13.4% of all jobs centration of jobs in the biosciences. Source: Bureau of Labor Statistics in the state4. This suggests that Louisiana already has a reasonably large, well-trained workforce in this industry. The region is already home to numerous, well-respected institutions of research and education in the biosciences. The region has seen unprecedented investment in state of the art facilities in recent years. Over $2.3 billion has been committed to new research and clinical assets, including the University Medical Center, Veterans Administration hospital, New Orleans BioInnovation Center, and Louisiana Cancer Research Consortium. The VA Hospital is one of many major investments in bioscience The result of these investments will be a suite of facilities. Others include the New Orleans BioInnovation Center, the Louisiana Cancer Research Consortium, and the University gleaming new bioscience facilities, as compelling as Medical Center. any in the United States. As measured by grants from the National Institutes of Health (NIH), Southeast Louisiana has a reasonably Examples of Major Biosciences Assets in Southstrong research presence. New Orleans, the 53rd east Louisiana: largest city in the U.S., was ranked 47th in the country LSU Health Sciences Center in NIH funding in 2011. With continued stewardship, LSU Main Campus the region could become well known in a number of Xavier University research disciplines including diabetes, cardiovascu Tulane University Medical Center lar care, and neuroprotection and rehabilitation. Tulane National Primate Research Center University of New Orleans Dillard University Pennington Biomedical Research Center Our Lady of the Lake Regional Medical Center Louisiana Cancer Research Consortium New Orleans BioInnovation Center J. Bennett Johnston Sr. Center for Advanced Microstructures & Devices

Source: Bureau of Labor Statistics, Quarterly Census of Employment and Wages

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BioDistrict New Orleans

An Economic Engine for Southeast Louisiana

A Thriving Biosciences Industry Stands to Benefit All of Southeast Louisiana

Business leaders are increasingly viewing Southeast Louisiana as a single, economically integrated super region. Collectively, the three metropolitan areas within the region comprise nearly 2.4 million residents5 and over 1,000,000 jobs6. Furthermore, a 60 90 minute drive is all that separates the most distant of the 21 parishes in the area. Many of the states bioscience assets are dispersed throughout the super-region. These include exemplary hospitals, research institutions, and educational assets. Given the geographical dispersion of these economic drivers and the increasing inter-connectedness of Southeast Louisiana, it stands to reason that the spoils of a thriving biosciences sector will be spread throughout the area.

Major bioscience assets are located throughout Southeast LA.

Recent Investments in the Biosciences Only Scratch the Surface of the Regions Economic Potential
For as important as the aforementioned investments are (the VA Hospital, University Medical Center), Louisiana cannot be content with the direct, immediate economic effects of these facilities. It is one thing to offer strong hospitals that serve the needs of area residents. It is quite another to become a true center of excellencethe kind of bioscience community that generates innovative clinical treatments, new medical technologies, and a thriving entrepreneurial climate. To illustrate this distinction, it is helpful to examine three employment scenarios: The near-term employment that results primarily from the forthcoming hospitals in New Orleans An estimate of the jobs that would be generated by an emerging bioscience economy in Southeast Louisiana over a 20 year period The level of employment seen at established biosciences hubs, such as the Cleveland Clinic and the UAB Medical Center in Birmingham. A recent economic impact analysis prepared by Dr. James Richardson of LSU, highlights the tremendous difference between these three scenarios. Once completed, the VA and UMC hospitals in New Orleans, along with limited supporting businesses, are expected to generate a total of 11,000 jobs7. If these investments are paired with a sustained commitment to related industries, such as pharmaceutical manufacturing and R & D, the BioDistrict could yield over 19,000 permanent jobs within ten years and over 34,000 permanent jobs within twenty years. If Southeast Louisiana is able to replicate the success of other biosciences hubs, total employment could be on the order of 50,000 70,000 permanent jobs. It behooves the State of Louisiana to aim for much more than simply good hospitals; we should indeed strive to transform Southeast Louisiana into a true biosciences hub. To do anything less would be a tremendous missed opportunity and an under-utilization of the billions that are being spent on new health care facilities in the region.
The Cleveland Clinic is at the center of an estimated 70,000 bioscience jobs in the Cleveland metropolitan area. Other recognized bioscience hubs around the country support between 50,000 and 70,000 jobs. One of the largestthe Texas Medical Center in Houstonsupports 145,000 jobs. Three Economic Scenarios for the Region 1. Near-term employment resulting primarily from UMC and VA hospitals: over 11,000 permanent jobs 2. Employment at hospitals in conjunction with an emerging research/innovation economy: 34,000 permanent jobs by year 20 3. Employment on the scale of other bioscience hubs in the United States: 50,000 70,000 permanent jobs
Source: Dr. James Richardson, LSU

Source: Census Bureau, 2011 Population Estimates Source: Bureau of Labor Statistics, Quarterly Census of Employment and Wages. Note: jobs is used interchangeably with employment. Note that all jobs figures include both direct employment as well as indirect/induced employment. Note also that the employment impact of construction is not included within these figures. During the peak construction period over the next five years, construction-related employment will average over 7,000 jobs per year.
5 6 7

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BioDistrict New Orleans

An Economic Engine for Southeast Louisiana

BioDistrict New Orleans Is the Best Vehicle for Realizing This Economic Opportunity
Dr. Richardsons report states that the development of a true bioscience economy requires long-term and sustained commitments. It requires the cultivation of a true ecosystem of research, collaboration, workforce training, and entrepreneurship. In short, it requires continual stewardship and technical capacity. The BioDistrict is designed precisely for this role. Since its inception in 20058, the BioDistrict has directed a wide range of tasks, including: Providing technical assistance, grant writing, and other services to facilitate innovation Strengthening the biosciences workforce by aligning education with workforce needs Advocating for policies and investments that will stimulate the biosciences Creating an appealing, sustainably built environment for the bio Stimulating the formation of new technology-based sciences is an essential role of the BioDistrict. This has been one companies of the areas of focus of the BioDistrict New Orleans Master Plan. Promoting the commercialization of new innovations, products, and processes that will bring more research The key to success is maintaining dollars to our universities Attracting research-intensive industries a consistent level of commitment Creating an appealing, sustainably built environment for the to the mission. The first step is biosciences economy within the New Orleans region Best of all, the administrative infrastructure to accomplish these and other tasks is already in place. The only obstacle to the continued efforts of the BioDistrict is a stable, recurring source of revenue to fund its operations. Until now, the BioDistrict has been supported through one-time grant funding that will soon expire. There is currently a proposal to include the BioDistrict within the operating budget of Louisiana Economic Development (LED). Legislative action on this proposal is

operational funding from the City and/or the State in the amount of $1.5 million for 2012-13.

needed to ensure the continued operations of the BioDistrict.

Conclusion
Southeast Louisiana has an historic opportunity to build a bioscience economy. Unprecedented investment in physical infrastructure is underway. The question before the region is whether employment will be limited to those new facilities, or whether they will serve as a foundation for transforming the region into a significant biosciences hub. The BioDistrict is one of the cornerstones of that foundation. The BioDistrict exemplifies the paradigm shift towards the knowledge-based economy, one in which university driven innovation is the essential ingredient. To capitalize on this innovation, we must create a cohesive, strategically planned community that unites local research strengths with entrepreneurship, capital, workforce development, and training programs. These linkages will, in turn, attract outside investment, new companies, and corporate expansions in the biosciences. If properly funded, the BioDistrict will continue to foster these linkages and build the biosciences economy of Southeast Louisiana. Accordingly, we

are asking for the Legislatures support during the remainder of the 2012 legislative session.

Created by Act No. 487 of the Louisiana State Legislature in the 2005 regular session.

To support the mission of BioDistrict New Orleans and to find out more about how the BioDisctrict will impact your district, please contact us: BioDistrict New Orleans | 504-593-6454 (P) brobertson@biodistrictneworleans.org | www.biodistrictneworleans.org

Prepared By:

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