This is the first of a two-part editorial.
As state leaders shift their focus toward 2021 and the hope for ubiquitous access to an effective COVID-19 vaccine rises, one key priority is getting Virginians back to work.
The question is how? “How do we move toward recovery? How do we accelerate recovery?” asked Virginia Economic Development Partnership (VEDP) President Stephen Moret in a Friday presentation during the 2020 Virginia Economic Summit and Forum on World Trade. Hosted by the Virginia Chamber of Commerce, the event focused on resiliency amid the coronavirus, and the search for solutions extends beyond state borders.
To reach full economic recovery, Virginia can improve its position on the world stage. One of the biggest drivers actually was conceived prior to the pandemic.
In November 2019, Gov. Ralph Northam unveiled the commonwealth’s first International Trade Strategic Plan. The initiative was designed to improve Virginia’s role in the global marketplace and better leverage its unique assets.
“Maintaining Virginia’s position as the best state to do business and ensuring that all regions of the commonwealth can participate in our economic growth requires that we boost our international trade,” Northam said in a statement at the time. “Virginia has a great deal to offer, including the East Coast’s deepest port, and we are committed to doing more to support and promote growth-minded companies as they successfully expand into global markets.”
Then COVID-19 arrived, and the associated economic fallout persists. While the commonwealth’s unemployment rates have stayed below national levels, the most recent data from September showed Virginia had 243,000 fewer jobs compared to February.
Moreover, the decline in total employment doesn’t capture the disruption at individual household levels. Some Virginians used to be working full time but now only have part-time jobs. Others have lost second jobs, or seen their wages or hours lowered.
“There are several hundred thousand people in Virginia [who] are in a more difficult position from an employment perspective today than they were prior to the pandemic,” Moret said Friday.
Now is the time to act on the International Trade Strategic Plan. Virginia is seeking to increase its total exports by 50% over the next 15 years and double the crop of companies served by VEDP international trade programs.
If successful, the commonwealth would jump from 41st to the top 20 in state rankings and become a leader in the South. The move also would result in an additional $18 billion in annual export sales and 150,000 jobs.
But perhaps the most critical point is the expediency of the timeline. Moret added that many of those export-driven jobs could be conceived in the next two to three years — a fast-track approach that supports Virginia’s push to recover as quickly as possible from COVID-19.
A recent economic forecast from Moody’s Analytics said that the commonwealth could return to prepandemic employment levels by late 2023. But even then, there will be a different mix of job sectors.
Hard-hit occupations like leisure and hospitality, nonessential retail or restaurants could face a steeper path to recovery. Additionally, the commonwealth could experience geographic divides, with economies along the urban crescent (Northern Virginia, the Richmond region, Hampton Roads) in a better position than smaller metro areas or rural communities.
To help fill gaps and create high-paying opportunities, Moret said the foundation already is in place with the commonwealth’s pre-existing international trade programs. It’s just a matter of better alignment.
“We literally have hundreds of companies that would like to make use of these programs,” Moret said. “We don’t have enough staff to be able to serve them.”
Through a steering committee led by two Cabinet members — Secretary of Commerce and Trade Brian Ball and Secretary of Agriculture and Forestry Bettina Ring — the International Trade Strategic Plan determined three broad routes to promote trade-intensive growth. These include expanding capabilities and connections for exports, supply chains and “enablers” — policies that yield international growth, from infrastructure to tourism.
A greater investment in the commonwealth’s international potential was an obvious choice before the COVID-19 pandemic. As we work to dig out of the economic disruptions caused by the public health crisis, the commitment to new, global avenues for growth in Virginia is even more important. With the framework already there, the time is now for robust implementation of the International Trade Strategic Plan.
— Chris Gentilviso