Frankfort, KY - The employers of tens of thousands of Kentuckians met for the first time as the board of the Bluegrass Economic Advancement Movement (BEAM) to begin the quest to make the Lexington/Louisville corridor a haven for advanced manufacturing.
"Our goal is to create the best geographic region for advanced manufacturing in the world... so we've got some work to do," Louisville Mayor Greg Fischer told the board of 19 appointed by he and Lexington Mayor Jim Gray.
Fischer said the region and the United States as a whole have suffered since much of the nation's manufacturing jobs moved across borders.
"The feeling 10-20 years ago that manufacturing is too dirty for us, 'let's have other countries do that, there's plenty of service jobs out there, we'll be fine,'" he said. "Well, there are plenty of service jobs, the problem is they pay one-half or one-third what a good manufacturing job would."
Shortly after being elected to office last November, Gray and Fischer met to discuss ways the state's two largest cities could join together in helping one another and the state as a whole.
"We need a higher profile internationally when these large national and international investments are made," Fischer said, "So we said instead of competing against each other, which has happened for too long in our state, we should partner with each other. Let's develop a cooperative partnership where our combined population is in the 2.5 (million) to 3.5 million range."
Announced over the summer, BEAM is focused on identifying ways to make the Bluegrass region more attractive to large scale manufacturers and the network of suppliers that inevitably sprout up in the area to feed them.
"This is not about the 22-counties (in the BEAM region), but about Kentucky," said the board's chairman Jim Host. "Sixty percent of all the economic development, jobs, taxes, 60 percent of all the taxes in this state are generated by these two areas. So that means as Louisville and Lexington go, so goes Kentucky."
To bring to the movement the expertise it needs to know what works well for manufacturers in the state and what hinders them, Gray and Fischer appointed a board that includes some of the biggest names in American and international industry. GE, UPS, Ford, Toyota, Lexmark, AT&T, Raytheon and more have a presence on the board.
"Whenever you see a commitment like this and the talent, the horsepower of the people sitting around the table, you know that something good is going to come from it," Gray said following the meeting in Frankfort.
Gray said a group with a makeup like this one will be capable of marshaling resources to discover solutions to complex issues. "The easy and first answer is always some sort of government or public intervention and I think what we're saying here is that policy change may be a part of our solutions and recommendations that emerge but changes will also occur in the private sector through simple collaborations," he said.
One such possible collaboration came after Rena L. Sharpe, VP of North American Operations, for Brazil-based Westport Axle Corp talked about her company's trouble expanding in the Louisville area after her company came to the realization that the type of work they are doing is now cheaper to accomplish in the US than in Brazil.
"We're struggling and we're looking at other areas, other states to be honest with you because we're really concerned about putting more here and not being able to get the employees," she said. "We've just transferred two engineers from Brazil because we had to, we didn't have a choice. With direct labor it is $14 - $15 an hour jobs with great benefits but we cannot fill the positions. For every 10 we hire, three or four don't show up for the first day, and we're just struggling."
Wil James, president of Toyota Motor Manufacturing Kentucky told the group about what TMMK did when they realized there was a skills gap between what was required to work at their Georgetown facility and what prospective employees were capable of. To address the issue Toyota has teamed with a number of groups in the area including the Blue Grass Community and Technical College to provide training that will turn into jobs.
James invited the group to come look at what Toyota has been doing to address the skills gap issue in hopes they and others around the state can learn how to keep the workforce up to speed with the skills needed for the economy.
Longtime Kentucky journalist and board member Al Smith told the group they still had spots to fill on the board as corporate and university leaders weren't enough to tackle the issues they were discovering.
"We've got to bring in somehow or another not only the commissioner of education but we've got to get the teacher's union here to buy in to what we're talking about," he said.
"I don't know who's going to pay to upgrade the skill level of the kids that are going to be graduating from high school in the next five years, but there's an easy answer that the taxpayers are doing it right now. But Toyota is doing it all over again and industry after industry all over this country is spending hundreds of millions of dollars training employees who've graduated from colleges, junior schools and so on that are not skilled enough to really get in and do the work without new training. It's like the colleges remediating the kids who come from high school and can't read or do the math," he said.
Amy Liu of the Brookings Institute who is helping guide the processes said talk like this and collaboration on the local level is what's needed to achieve success in the new economy.
"(The next economy) has to be built from the ground up. At a time without Federal leadership as demonstrated by the most recent developments (the failure of the Super Committee) we cannot wait for Washington, we fundamentally believe we have to build the economy from the ground up. The economic reason for that is because metropolitan areas are units of the global economy," she said.

Given that, Gray, Fischer and Host know the group they've assembled - and maybe a few future additions - can create the type of groundswell of regional support to make BEAM a success.
"It would be good for educational leaders, the governor's office to be here hearing (this). This is where the rubber meets the road, and too often it gets lost in committee meetings and blah, blah, blah, and the world is now moving so fast that we don't have time for committee meetings ad nauseum, we've got to get on this," Fischer said.
"There will be an aligned voice of the customer, and that's this group right here saying this is what we need," he added. "We can complain about Washington, but lets come back to our home towns and do what we can do here, that's where it's happening, the city level."
The board will meet quarterly with with the next session scheduled for March 12th. In the meantime the board will be invited to tour facilities in the state to learn more about what others are doing. Chairman Host made it clear to the board that he understood they may not be able to attend each event, but they were expected to send someone to represent them. A working group made up of the mayors' staffs, staffs of Commerce Lexington and Greater Louisville Inc., the Kentucky Association and Manufacturers and others have met four times and will continue meeting to provide information for the board.
In addition to Host and the mayors, the board is made up of: