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High Tech Development Brings Prosperity, Widens Disparities According to UAlbany Nonprofit Executive Roundtable Report

Contact: Catherine Herman (518) 437-4980

ALBANY, N.Y. (May 17, 2006) -- A tech-driven job market assisted in bringing about a financial boom to the Austin, Texas region but also helped widen racial disparities in economic well-being according to a new report from the University at Albany's Nonprofit Executive Roundtable. The study, High-Tech Growth and Community Well-Being: Lessons Learned from Austin, Texas, was presented at a meeting of the Tech Valley Nonprofit Business Council, a shared initiative of the Albany-Colonie Regional Chamber of Commerce and The Chamber of Schenectady County.

"The explosive population influx and the increasing number of high paying jobs drove up the cost of living to a record high in Austin," said Judith Saidel, report co-author and director of UAlbany's Center for Women in Government and Civil Society. "We found that low skilled workers found themselves out of work in the tech-driven job market, that the cost of housing increased exponentially and Austin quickly became one of the most expensive cities in Texas. The racial and economic divides widened with the historically African American and Hispanic populated areas of the city experiencing a 50 percent poverty rate compared to the 15 percent poverty rate for the entire city of Austin."

Given the Capital Region's emergence as Tech Valley and wide ranging community consequences of high-tech driven economic development, the Nonprofit Executive Roundtable decided to conduct a case study of Austin's economic growth experience and related community impacts. "The purpose of this case study is to identify lessons learned from Austin's experience as a basis for future cross-sector planning efforts here in our region," said co-author Teri Bordenave, president and CEO of Girls Incorporated of the Greater Capital Region. "The Roundtable's premise is: As we learn about Austin, we learn about ourselves."

Among the key findings:

• The "Technopolis Wheel" model, widely accepted as a blueprint for Austin's tech-driven future, identified business, government, and academia as the major players in economic development. Austin's nonprofit leaders were largely uninvolved in economic development planning prior to or during the tech boom periods. The nonprofit sector's unique knowledge of unmet community needs and vulnerable populations did not inform the planning process.
   
• New wealth generated from the tech boom provided new philanthropic opportunities and new expectations. A culture clash developed between nonprofits and high-tech companies and between high-tech companies and the "old economy" of Austin, creating tensions between sectors.
   
• In the wake of the tech-bubble bursting, tech start-up funds and philanthropic dollars quickly evaporated, signaling an immediate and significant reduction in nonprofit funding.

The report developed key guidelines for future expansion of the Capital Region's Tech Valley:

• Create opportunities for broad community learning, planning and visioning.
   
• Involve stakeholders from all sectors - business, government, nonprofit, universities, in creating the vision for Tech Valley.
   
• Identify strong leaders who involve all stakeholders in a truly inclusive planning process.
   
• Acknowledge differences between high-tech and other cultures and develop organizational practices that accommodate the differences.
   
• Identify measures of success as part of the visioning process.

The study is the second in a series of Roundtable publications on nonprofits and regional economies. The first report, The $4 Billion Growth Industry that Cares, The Impact of the Nonprofit Sector on the Capital Region of New York State. Published in 2003, the report documented the impact of the nonprofit sector on the economy and quality of life in the Capital Region.

The Nonprofit Executive Roundtable is a forum to identify and address broad, pressing issues relevant to the nonprofit sector. Based at UAlbany's Rockefeller College of Public Affairs and Policy, the Roundtable is a community-university collaboration with two primary goals: to expand awareness of the voluntary sector as a key contributor, along with business and government, to the economy and quality of life of the Capital Region; and to catalyze cross-sector conversations, such as between business and nonprofit leaders, about the challenges and opportunities for Tech Valley of technology-based economic growth.

Ranked among the top-10 Public Affairs programs in the nation, the Rockefeller College of Public Affairs & Policy's core mission is to discover, communicate, and apply knowledge about politics, governance, public policy, and public management. The college directly helps public managers, policymakers, and others deal effectively with the challenges they face, making democracy stronger and governments more effective around the world. For more information, visit Rockefeller College of Public Affairs & Policy.