Remarks by CenterState CEO President Robert M. Simpson, 2022 Economic Forecast Event
Posted on January 25, 2022
Good morning! First and foremost, I would like to thank our partners, St. Joseph’s Health and M&T Bank, for their continued support of this event, and of our work to drive forward a new, more equitable and prosperous chapter for our region.
To our members and partners who have joined us today, thank you. When I reflect on the optimism and opportunities before us, I recognize that they exist despite ongoing uncertainty and unprecedented circumstances thanks to your passion, perseverance and commitment to our collective success.
And to our staff at CenterState CEO, I’m exceptionally grateful for your dedication to our members and community. While juggling the personal and professional pressures of the past few years, you have remained focused on advancing our mission and values. This work – your work – matters and has a profound impact. Thank you.
As much as today is about reflecting on and putting into context the economic trends of the past year, it is also about looking forward. Our vision for this region as a place where business thrives, and ALL people prosper is closer than ever.
I would like to thank Peter Kneiss for joining us today. It is not an easy task to fill the shoes of Gary Keith, but you have done so, and we are thankful for your insights and sharing a greater understanding of the nuances of our regional economy. As you rightfully pointed out, many of the trends we see are not unique to Central New York but rather reflective of a national and international economy that has been put under the tremendous pressure of a prolonged pandemic.
Even amid those pressures I am incredibly confident for what the year ahead will bring. For starters, for the first time ever, the sentiment of our forecasters is exceptionally positive – even as they share the real and daunting challenges they face. Here is what they said about the year ahead in 2022.
- 72% described their outlook for the strength of their business in 2022 as strong or very strong; up 30% from 2021 when 42% described their outlook as such.
- 75% expect sales or revenues to increase in 2022, up 31% from 2021 projections.
- 56% expect to expand products and services in 2022, up 14% from last year.
- 68% expect an increase in jobs and hiring in 2022, up 29% from 2021 projections.
- And 49% expect to increase capital investments, up 15% from the prior year’s outlook.
Consider that for just a moment. At no point in our focus groups or surveys – not one single time – was the word “down” used to describe year-over-year projections. Even more notable is that each projection is up more than 10% from 2021. At a time when there are real economic concerns and pressures, our forecasters across all sectors expect double digit growth.
And 53% say their business endured the impacts of the COVID-19 pandemic extremely or very well, with 49 reporting that business is close to being back, or even stronger than it was before the pandemic.
This optimism feels good, especially when you think back over the tumult of the past weeks, months and year. This pandemic has reshaped us and mounted pressure on top of pressure in ways that are neither healthy nor sustainable.
Like many of you, I have struggled at times. Have had moments of frustration. Even the occasional measure of doubt and disappointment over a pandemic that has caused both physical and emotional pain, and interrupted an economic resurgence that our community has fought for and earned over several decades.
I have had to step away at times just to recharge. The activity that has given my family and I the most enjoyment is hiking the Adirondacks High Peaks. To date we have completed 22 of the 46 High Peaks, with 9 in 2021 alone. The woods have always been a source of energy and inspiration for me, and the Adirondacks are a huge part of what brought my wife and I home to Upstate New York in 2003. The peace and solitude of a hike calms the soul. And there is a tremendous sense of accomplishment that comes with each climb. Although that is not to say that each step of the ascent is easy. In fact, it rarely is. And when you are starting any hike, you're often in the woods. Unable to see more than a few hundred feet in front of you. Unable to see your destination, which makes progress, even when tangible, feel anticlimactic.
Think back to all of those years at this event when Gary Keith shared that his forecast was for slow and steady growth – forward yes, but nothing so dramatic as to represent a fundamentally different worldview of where the Central New York economy was headed
And yet, we kept after it, kept pushing forward. Doubling down on our regional economic strategies to build an economy based on our region’s assets. Focusing on innovation, talent, equitable opportunities, and sectors of the economy in which we could draw upon our historical expertise.
And little by little we have reached for new heights, finally finding enough distance from where we started that we can gain perspective and grab our first views of the horizon. It’s a vantage point that enables us to turn around and recognize that our altitude has changed. We have made real progress.
From this height we see where we were in 2004, when our innovation ecosystem ranked near the bottom of every measure of success. Together, we have since supported the growth of entrepreneurs and small businesses. Just a few months ago, we celebrated The Tech Garden’s first unicorn. Density, The Tech Garden’s anchor tenant, started here less than a decade ago with an idea and a vision, is now valued at more than $1 billion, and is still growing. And they are not alone. In 2020, more than 100 Tech Garden companies collectively created 411 jobs, received $100 million in follow-on investments, drove $54 million in annual revenue, invested $23 million in capital expenditures and plan to add 624 jobs in the next year. Early review of data from 2021 suggests a significant increase in these metrics year-over-year. Our ecosystem is now a vibrant part of our regional narrative that we celebrate, and we will continue to invest in that ecosystem by breaking ground on The Tech Garden’s expansion in 2022.
Likewise, let’s reflect back to what Downtown Syracuse looked like in the mid-2000’s when we utilized photography from local artists to create window wraps for empty downtown storefronts. Literally, papering over blight in our urban core. Since 2009, Downtown’s population has grown 70% with more than 4,000 residents and these neighborhoods continue to grow. Currently, downtown’s residential occupancy rate is at 99% and our commercial market is showing signs of strength as well.
In just the last two weeks alone, Equitable has announced that it has renewed its lease and commitment to downtown and will remain one of downtown’s anchor employers for years into the future. And the City Center project just broke ground on what is the last phase of its planned redevelopment of the former Sibley’s department store – transforming the city’s last untouched major intersection. Huntington Ingalls, a major defense contractor, will move its 75 employees into the building with plans to double its workforce.
And given our region’s current leadership role in the unmanned systems industry it is almost impossible to think back a decade and realize the current drone ecosystem didn’t exist. Building on our regional assets in sensing and data we literally created what is now recognized as the single best place in the world to grow your UAS business. We worked together to pitch and land just one of seven FAA designated UAS test sites, built the nation’s first 50-mile beyond visual line of sight test corridor and welcomed hundreds of companies to the region for testing globally relevant and industry leading technologies. Through the state’s investment we launched the GENIUS NY program, which since 2017, has invested more than $15 million in 26 companies that have gone on to raise more than $73.5 million in follow-on funding and create 60 jobs in the region.
Every last one of these accomplishments we have realized together. And we deserve to take a moment and celebrate how far we have come because, for so much of our journey together, we have been underestimated. Our region has been consistently overlooked. Far too many have said we couldn’t, said we wouldn’t, and doubted us. And yet, here we are, punching well above our weight class. Because we simply would not stop working toward our goals.
If you’ve ever climbed a high peak, or any mountain for that matter, you know that the thing that takes your breath away and makes all the hard work worthwhile is the view. You emerge from the tree line and scramble to the top and the entire world unfolds in front of you. Yes, you can see across the horizon and take in the amazing views, but you can also be seen by others who can notice how far you’ve come.
Just last month, the region was named among only 60 finalists selected from more than 500 nationwide applications to the Build Back Better Regional Challenge, a central component of the U.S. Economic Development Administration’s American Rescue Plan. As a phase 1 finalist, the region is on a path to compete for up to $100 million in federal economic development funds. CenterState CEO led a coalition of partners, including the CNY Regional Planning and Development Board, on the collaborative application that outlines opportunities in the region’s emerging “smart systems” cluster. The proposal builds upon our region’s efforts to establish a globally relevant technology hub by expanding its semiconductor manufacturing capabilities, and growing existing UAS and quantum computing industries while training under-represented workers to enter in-demand fields.
While some might have doubted our ability to succeed in such a venture a decade ago, our track record suggests that cynics beware. Because we are doing it. In just a few weeks, JMA Wireless will open the doors to its new, $50 million 5G campus on the South Side of Syracuse. This is the first major manufacturing facility built in the city in decades and marks an important chapter in the resurgence of the neighborhood, which is arguably one of the most historically marginalized and underinvested neighborhoods in the city. It’s a project that demonstrates leadership and intentionality and is reminiscent of the early actions taken by leaders in downtown Syracuse to redevelop vacant and underutilized buildings.
This project also reflects the leadership of the business community that has leaned into its commitments related to diversity, equity and inclusion. To date nearly 20 companies have engaged with our Racial Equity and Social Impact portfolio, led by Dr. Juhanna Rogers. And they have sounded the call to ensure that as we attract new development, we do so with a focus on connecting those living in distressed communities – often people of color - to economic opportunities through training and resources. In the past eight months, alongside our educational, City of Syracuse and Onondaga County partners, we have graduated 30 people from Syracuse Build’s Pathway’s to Apprenticeship program, setting them on the course for opportunities in the construction field. And due to the overwhelming interest and success of the program we have just launched applications for the program’s third cohort.
To be fair, these accomplishments don’t yet represent the summit for Syracuse and Central New York. There is still plenty of ground we must cover and difficult climbing to do. The 2020 census reminds us that 40% or two out of every five students in Syracuse live in poverty. This is not acceptable. Likewise, the COVID-19 pandemic has also shed new light on economic pressures facing businesses. Hiring is needed for all levels, which is a signal that employers must continue to think differently about how they recruit, train and retain, to compete in this new labor market. These challenges require creative, collaborative efforts, and we will continue to partner with business and community leaders around solutions.
But I hope that you share a deep sense of pride and accomplishment for all the gains we have made together. And I hope that you feel the same level of commitment, determination and tenacity that I do as we ready ourselves for the next push toward the top.
During our High Peaks adventures, there have been no shortage of moments where we have been tempted to quit. Where the trail is steep. Where the bugs are vicious. Where the mud is thick and the progress slow. There have been times where pure exhaustion overtakes adrenaline. But in each case, my family and I have taken the next step together. And in each case, we have been rewarded with remarkable views, hours of family time away from screens and memories that we will never forget.
And in every case, as we start down from our final summit of the day, the conversation inevitably turns to one topic, and one topic alone. Which peak are we climbing next?
As we begin the year, let’s celebrate how far we have come. Let’s admire the view and acknowledge the massive and exciting opportunities on the horizon. And then let’s lace up our boots and tap into our region’s tenacious spirit to KEEP…GOING.
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