Nebraska Competitiveness: State and Cluster Economic Performance

1 NGA 2011 – Nebraska Copyright © 2011 Professor Michael E. Porter

Nebraska Competitiveness:

State and Cluster Economic Performance

Prepared for Governor Dave Heineman

Professor Michael E. Porter National Governors Association Winter Meeting

February 26, 2011

http://upload.wikimedia.org/wikipedia/commons/7/73/Seal_of_Nebraska.svg


Nebraska Performance Snapshot

• Processed Food

• Financial Services

• Heavy Machinery

• Medical Devices

• Agricultural Products

Prosperity

Innovation

Productivity

Labor Mobilization

Cluster Strength

Leading Clusters

Position Trend

Top quintile

3rd quintile

4th quintile

2nd quintile

Lowest quintile


State Comparative Performance


Nebraska Competitiveness Overall Economic Performance Indicators

Note: Ranks are among the 50 US states plus the District of Columbia. Growth calculated as compound annual growth rate. *Real annual rate.

Prosperity

Cluster

Gross State Product per capita, 2009 Share of State Traded Employment in Strong Clusters, 2008

• In Nebraska: $48,112 Rank: 18 • In Nebraska: 34.7% Rank: 29

• In the US: $46,093 • In the US: 41.8%

• State difference to US: 4.4%

Change in Share of National Employment in Strong Clusters, 1998-2008

Growth in Gross State Product per capita, real annual rate, 1999-2009 • In Nebraska: 0.10% Rank: 21

• In Nebraska: 1.88% Rank: 7 • In the US: -0.06%

• In the US: 0.86%

Share of Employment in Traded Clusters, 1998-2008

• In Nebraska: 30.6% Rank: 8

Productivity • In the US: 27.4%

Gross State Product per labor force participant, 2009 Change in Share of Employment in Traded Clusters, 1998-2008

• In Nebraska: $88,140 Rank: 19 • In Nebraska: -1.0% Rank: 16

• In the US: $92,382 • In the US: -2.2%

• State difference to US: -4.6%

Labor Mobilization

Growth in Gross State Product per labor force participant*, 1999-2009

• In Nebraska: 2.08% Rank: 9 Population, 2009

• In the US: 1.09% • In Nebraska: 1,796,613 Rank: 38

• % of US: 0.59%

Average private wage, 2008

• In Nebraska: $35,046 Rank: 37 Population growth, annual rate, 1999-2009

• In the US: $42,435 • In Nebraska: 0.53% Rank: 33

• State difference to US: -17.4% • In the US: 0.96%

Private wage Growth, annual rate, 1998-2008 Labor Force Participation, 2009

• In Nebraska: 3.34% Rank: 25 • In Nebraska: 72.1 Rank: 4

• In the US: 3.32% • In the US: 65.4

Employment, 2010 (December)

Innovation Output • In Nebraska: 930,671 Rank: 37

• % of US: 0.67%

Patents Per 10,000 Employees, 2009

• In Nebraska: 2.40 Rank: 39 Employment growth, annual rate, 2000-2010 (December)

• In the US: 6.83 • In Nebraska: 0.06% Rank: 28

• In the US: 0.11%

Growth in total patents, annual rate, 1998-2009

• In Nebraska: -0.50% Rank: 22 Unemployment, 2010 (December)

• In the US: 0.23% • In Nebraska: 4.4% Rank: 2

• In the US: 9.4%

Traded establishment formation, annual growth rate, 1998-2008

• In Nebraska: 1.67% Rank: 26 Change in Unemployment, 2000-2010 (December)

• In the US: 1.79% • In Nebraska: 1.6% Rank: 2

• In the US: 5.5%


$30,000

$35,000

$40,000

$45,000

$50,000

$55,000

$60,000

$65,000

$70,000

-1.0% -0.5% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0%

U.S. GDP per

Capita: $46,093

High and rising

prosperity versus U.S.

Long Term State Prosperity Performance 1999 to 2009

Notes: Real GDP figures in 2005 chained US dollars from the Bureau of Economic Analysis. Growth rate is calculated as compound annual growth rate. D.C. excluded

U.S. GDP per Capita

Real Growth Rate: 0.86%

Gross Domestic Product per Capita Real Growth Rate, 1999 to 2009

Gro

ss

Do

mes

tic P

rod

uct

pe

r C

ap

ita,

20

09

High but declining

versus U.S.

Low and declining

versus U.S. Low but rising versus U.S.

Illinois

Wyoming

North Dakota

South Dakota

Delaware

Alaska Connecticut

Wisconsin

Nevada

Arizona

New York New Jersey Massachusetts

California

West Virginia

Mississippi

Vermont Oklahoma

Iowa Nebraska

North Carolina

Georgia Florida

Michigan

Idaho South Carolina

Texas

Oregon

Rhode Island Louisiana

Pennsylvania Kansas

New Hampshire

Arkansas

Maine

Colorado

Washington

Virginia

Minnesota

Hawaii Maryland

Alabama Montana Kentucky

New Mexico

Missouri Ohio

Indiana Utah

Tennessee


$30,000

$35,000

$40,000

$45,000

$50,000

$55,000

$60,000

$65,000

$70,000

-6.0% -4.0% -2.0% 0.0% 2.0% 4.0% 6.0%

Near Term State Prosperity Performance U.S. States, 2007 to 2009

Notes: Real GDP figures in 2005 chained US dollars from the Bureau of Economic Analysis. Growth rate is calculated as compound annual growth rate.

U.S. GDP per Capita

Real Growth Rate: -1.87%

U.S. GDP per

Capita: $46,093

Gross Domestic Product per Capita Real Growth Rate, 2007 to 2009

Gro

ss

Do

mes

tic P

rod

uct

pe

r C

ap

ita,

20

09

Illinois

Wyoming

North Dakota

South Dakota

Delaware

Alaska Connecticut

Wisconsin

Nevada

Arizona

New York New Jersey Massachusetts

California

West Virginia

Mississippi

Vermont Oklahoma

Iowa Nebraska

North Carolina

Georgia

Florida

Michigan


Texas

Oregon

Rhode Island

Louisiana

Pennsylvania Kansas

New Hampshire

Arkansas

Maine

Colorado

Washington Virginia

Minnesota

Hawaii Maryland

Alabama

Montana

Kentucky New Mexico

Missouri Ohio

Indiana

Utah

Tennessee

High but declining versus U.S.

Low and declining versus U.S. Low but rising versus U.S.

High and rising

prosperity versus U.S.


State Private Sector Wage Performance 1998-2008

U.S. Average Wage

Growth: 3.32%

U.S. Average

Wage: $ 42,435

Wage Growth (CAGR), 1998-2008

Ave

rag

e W

ag

e,

20

08

High and rising wages

relative to U.S.

Source: Census CBP report; private, non-agricultural employment. Growth is calculated on nominal wage levels.

$30,000

$35,000

$40,000

$45,000

$50,000

$55,000

$60,000

2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 5.0% 5.5%

Illinois

Wisconsin

Wyoming

New York

North Dakota

Michigan

Massachusetts Connecticut

New Jersey

Alaska

California

Washington

Delaware Maryland Minnesota

Colorado Texas

Virginia

Indiana


West Virginia

Mississippi

Tennessee

Hawaii

Ohio

Georgia

New Hampshire

Rhode Island

Louisiana

Oklahoma

New Mexico

Arkansas

South Dakota

Montana

Pennsylvania

Iowa

Maine Kentucky

Alabama

Nebraska Utah

North Carolina

Vermont

Arizona

Nevada Kansas Florida

Missouri

Oregon




$60,000

$70,000

$80,000

$90,000

$100,000

$110,000

$120,000

$130,000

$140,000

$150,000

-0.5% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5%

Long Term State Labor Productivity Performance 1999-2009

Source: Bureau of Economic Analysis. Notes Growth rate calculated as compound annual growth rate (CAGR).

Gross Domestic Product per Labor Force Participant Real Growth Rate, 1999-2009

Gro

ss

Do

mes

tic P

rod

uct

pe

r L

ab

or

Fo

rce

Pa

rtic

ipa

nt,

20

09

Highly productive and

productivity rising versus U.S.



U.S. GDP per Labor Force

Participant Real Growth: 1.09%


Participant: $92,382

Illinois

Wyoming

North

Dakota South

Dakota

Delaware

Alaska

Connecticut

Wisconsin

Nevada

Arizona

New York

New Jersey Massachusetts

California

West Virginia

Mississippi

Vermont

Oklahoma

Iowa

Nebraska North Carolina

Georgia

Florida Michigan


Texas

Oregon Rhode Island

Louisiana

Pennsylvania

Kansas

New Hampshire

Arkansas

Maine

Colorado Washington Virginia

Minnesota

Hawaii

Maryland

Alabama

Montana

Kentucky

New Mexico Missouri

Ohio

Indiana Utah

Tennessee


$60,000

$70,000

$80,000

$90,000

$100,000

$110,000

$120,000

$130,000

$140,000

$150,000

-8.0% -6.0% -4.0% -2.0% 0.0% 2.0% 4.0% 6.0% 8.0%

Near Term State Labor Productivity Performance 2007-2009


Participant Real Growth: -0.97%


Participant: $92,382

Gross State Product per Labor Force Participant Real Growth Rate, 2007-2009

Gro

ss

Sta

te P

rod

uct

pe

r L

ab

or

Fo

rce

Pa

rtic

ipa

nt,

20

09

Highly productive and

productivity rising versus U.S.

Source: Bureau of Economic Analysis. Notes: Growth rate calculated as compound annual growth rate (CAGR).



Illinois

Wyoming

North Dakota South

Dakota

Delaware

Alaska

Connecticut

Wisconsin

Nevada

Arizona

New York

New Jersey Massachusetts

California

West Virginia

Mississippi

Vermont

Oklahoma

Iowa

Nebraska North Carolina

Georgia

Florida Michigan


Texas

Oregon

Rhode Island

Louisiana

Pennsylvania

Kansas

New Hampshire

Arkansas

Maine

Colorado Washington

Virginia

Minnesota

Hawaii

Maryland

Alabama

Montana Kentucky

New Mexico Missouri Ohio

Indiana Utah

Tennessee


Losing Jobs Gaining Jobs

Long Term State Job Growth 2000 to 2010

Source: Bureau of Labor Statistics

Nu

mb

er

of

Jo

bs 2

01

0

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

-2.0% -1.5% -1.0% -0.5% 0.0% 0.5% 1.0% 1.5% 2.0%

Texas (11,202,388)

U.S. Average Growth Rate: 0.11%

New York

Florida

Pennsylvania Illinois

Ohio

Michigan

Virginia

Washington

Arizona

Georgia North Carolina New Jersey

Massachusetts

Indiana

Missouri

Wisconsin

Tennessee Maryland Minnesota

Colorado

Alabama

Mississippi

West Virginia

Delaware

Rhode Island Hawaii Maine

Nebraska

Montana

Vermont Alaska

Utah Nevada

New Mexico Idaho

New Hampshire

Wyoming

South Dakota North

Dakota

Arkansas Kansas Iowa

Oregon Connecticut

Oklahoma

Kentucky Louisiana

South Carolina

California (15,945,558)

Job Growth Rate (CAGR), 2000-2010


Losing Jobs Gaining Jobs

Near Term State Job Growth 2007 to 2010


Job Growth Rate (CAGR), 2007-2010

Nu

mb

er

of

Jo

bs 2

01

0

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

-4.0% -3.5% -3.0% -2.5% -2.0% -1.5% -1.0% -0.5% 0.0% 0.5% 1.0%

California (15,945,558) Texas (11,202,388)

U.S. Average Growth Rate: -1.52%

New York

Florida

Pennsylvania

Illinois

Ohio

Michigan

Virginia

Washington

Arizona

Georgia North Carolina

New Jersey

Massachusetts

Indiana Missouri

Wisconsin Tennessee

Maryland

Minnesota

Colorado

Alabama

Mississippi West Virginia

Delaware Rhode Island

Hawaii Maine

Nebraska

Montana Vermont Alaska

Utah Nevada

New Mexico Idaho New

Hampshire

South Dakota

North Dakota

Arkansas Kansas

Iowa

Oregon Connecticut Oklahoma

Kentucky Louisiana South Carolina

Wyoming


Long Term State Unemployment Rate 2000 to 2010

Change in Employment Rate, 2000 to 2010

Un

em

plo

ym

en

t R

ate

, 2

01

0


Unemployment rising

3.0

5.0

7.0

9.0

11.0

13.0

15.0

0.01.02.03.04.05.06.07.08.09.010.0

Nevada

North Dakota

South Dakota

Nebraska

New Hampshire

Vermont

Wyoming Hawaii

Iowa

Kansas

Montana

Alaska

Louisiana

Virginia Oklahoma

Minnesota Maine Maryland

Utah Wisconsin

Arkansas New York Texas

Pennsylvania New Mexico

Delaware

Massachusetts

Colorado

Connecticut

Indiana

Georgia

South Carolina

Rhode Island

Michigan Florida

California

Kentucky Oregon

Mississippi

Washington

West Virginia Idaho

Illinois Alabama

New Jersey U.S. Average

Unemployment Rate: 9.4%

Change in US Average

Employment Rate: 5.5%

Ohio North Carolina

Missouri

Arizona

Tennessee

Below average

unemployment

Above average

unemployment

%

%

%

%

%

%

%

%

% % % % % % % % % %


3.0

5.0

7.0

9.0

11.0

13.0

15.0

0.01.02.03.04.05.06.07.08.09.010.0

Near Term State Unemployment Rate 2007 to 2010

Change in Employment Rate, 2007 to 2010

Un

em

plo

ym

en

t R

ate

, 2

01

0


Unemployment rising

U.S. Average

Unemployment Rate: 9.4%

Change in US Average

Employment Rate: 4.4%

Nevada

North

Dakota

South Dakota Nebraska

New Hampshire

Vermont

Wyoming Hawaii Iowa

Kansas

Montana

Alaska Louisiana

Virginia Oklahoma Minnesota

Maine Maryland

Utah Wisconsin

Arkansas New York Texas

Pennsylvania New Mexico

Delaware Massachusetts

Colorado Connecticut

Indiana

Georgia

South

Carolina Rhode Island

Michigan Florida

California

Kentucky Oregon Mississippi

Washington

West Virginia

Idaho Illinois Alabama

New Jersey

Ohio North Carolina

Missouri Arizona Tennessee

Below average

unemployment

Above average

unemployment

%

%

%

%

%

%

%

%

% % % % % % % % % %


0

2

4

6

8

10

12

14

-5% -4% -3% -2% -1% 0% 1% 2% 3%

Long Term State Patenting Performance U.S. States, 1999 to 2009

Growth Rate of Patenting, 1999 to 2009

Pa

ten

ts p

er

10

,00

0 E

mp

loye

es

, 2

00

9

Source: USPTO, Bureau of Labor Statistics. Note: Growth rate calculated as compound annual growth rate (CAGR). 3,000 patents issued in 2009 =

U.S. average Growth Rate

of Patenting: -0.30%

U.S. average Patents per

10,000 Employees: 5.96

High and improving

innovation rate versus U.S.

High but declining

Low and declining Low but improving

Arkansas (-6.9%, 0.76) Louisiana (-6.0%, 1.34)

Montana (-5.7%, 1.58)

South Dakota

West Virginia

Alaska

Idaho

Pennsylvania

Mississippi

Washington (+8.0%, 13.53)

Oregon (+4.9%, 10.31)

New Jersey

Ohio

Delaware

Vermont

California

Massachusetts

North Carolina

North Dakota Wyoming

Georgia

Nebraska Maine

Utah

Michigan

Minnesota

Colorado

New Hampshire

Connecticut

Wisconsin

Rhode Island

Kansas

Nevada Virginia

Iowa

Texas Arizona

New York

Illinois

Maryland

Indiana

New Mexico

Florida

Tennessee

Missouri

South Carolina Kentucky

Alabama

Hawaii

Oklahoma


Nebraska Patents by Organization

Rank Organization Patents

2005-2009

Rank Organization

Patents 2005-2009

1 Sportsstuff, Inc. 71 25 Snyder Industries, Inc. 4

2 J. A. Woollam Co. Inc. 58 25 Weyerhaeuser Company 4

3 University Of Nebraska, The Board Of Regents Of 50

25 Automatic Equipment Mfg. Co. 4

4 First Data Corporation 44 25 Gabriel Technologies, Inc. 4

5 Pioneer Hi-Bred International, Inc. 25 25 Auburn Consolidated Industries, Inc. 4

6 West Corporation 18 25 Solutionary, Inc. 4

7 Baldwin Filters, Inc. 15

32 Exmark Manufacturing Company, Incorporated 3

8 Centurion Wireless Technologies, Inc. 13 32 Kawasaki Jukogyo Kabushiki Kaisha 3

9 Goodyear Tire + Rubber Company 12 32 Lindsay Manufacturing Corporation 3

9 Monsanto Technology, Llc 12 32 Rowse Hydraulic Rakes Company, Inc. 3

11 Valmont Industries Inc. 11 32 Ttx Company 3

12 Li-Cor, Inc. 9 32 International Game Technology (Igt) 3

12 Teledyne Isco, Inc. 9 32 Amylin Pharmaceuticals, Inc. 3

14 Vishay Dale Electronics, Inc. 8 32 Ip Holdings, L.L.C. 3

15 Hewlett-Packard Development Company, L.P. 7

32 Syngenta Participations Ag 3

16 Adc Telecommunications, Inc. 5 32 Paraclipse, Inc. 3

16 Creighton University 5 32 Powermate Corporation 3

16 J.C.Robinson Seed Company 5 32 Election Systems & Software, Inc. 3

16 Kroy Building Products, Inc. 5 32 Elemental Scientific Inc. 3

16 Magnesium Diagnostics, Inc. 5 45 Abbott Laboratories 2

16 Irwin Industrial Tool Company 5 45 Aero Industries, Inc. 2

16 Adc Incorporated 5 45 Cabela'S Inc. 2

16 Streck, Inc. 5 45 Cargill, Inc. 2

16 Wheatware Usa, Inc 5 45 Data Security, Inc. 2

25 Hornady Manufacturing Company 4 45 Delaware Capital Formation, Inc. 2

Source: Prof. Michael E. Porter, Cluster Mapping Project, Institute for Strategy and Competitiveness, Harvard Business School; Richard Bryden, Project Director.

Note: Universities, research institutes, and government organizations are highlighted.

Universities and Research Institutions

Government Organizations


The Impact of Cluster Mix and Cluster Strength on Wages U.S. States, 2008

State

State Traded Wage versus

National Average

Cluster Mix Effect

Relative Cluster

Wage Effect State

State Traded Wage versus

National Average

Cluster Mix Effect

Relative Cluster

Wage Effect

New York 34,578 5,188 29,390 North Carolina -10,673 -5,131 -5,543

Connecticut 20,008 6,898 13,109 Missouri -10,953 -1,634 -9,319

Massachusetts 17,308 5,191 12,117 Rhode Island -11,089 -1,370 -9,719

New Jersey 12,157 4,638 7,519 Florida -11,780 -1,473 -10,307

California 9,597 121 9,476 Oklahoma -12,225 1,533 -13,758

Maryland 6,435 2,778 3,657 Alabama -12,301 -4,713 -7,588

Washington 4,827 3,058 1,769 Tennessee -13,063 -3,987 -9,076

Virginia 2,550 945 1,605 Vermont -13,095 -2,936 -10,159

Illinois 2,501 -61 2,562 Indiana -13,309 -5,495 -7,814

Alaska 2,386 -3,044 5,431 Nebraska -14,659 41 -14,699

Texas 1,400 2,796 -1,396 Utah -14,947 327 -15,274

Colorado 753 2,292 -1,539 South Carolina -15,256 -5,694 -9,562

Delaware 612 13,346 -12,733 Nevada -15,429 -2,829 -12,600

Louisiana -4,172 573 -4,745 Maine -15,826 -726 -15,100

Minnesota -4,404 43 -4,448 North Dakota -16,437 2,940 -19,378

Wyoming -4,423 1,408 -5,831 Iowa -16,963 -2,602 -14,361

Michigan -4,981 -2,534 -2,447 New Mexico -16,991 -125 -16,866

Pennsylvania -5,182 -1,064 -4,118 Kentucky -17,303 -5,013 -12,291

New Hampshire -6,359 1,224 -7,584 West Virginia -17,357 -4,290 -13,067

Georgia -7,262 -1,923 -5,338 Arkansas -17,616 -5,171 -12,445

Arizona -8,662 1,557 -10,219 Hawaii -18,103 -14,124 -3,980

Kansas -8,828 1,820 -10,648 Idaho -18,636 -1,567 -17,069

Ohio -9,766 -1,436 -8,330 Mississippi -20,859 -6,165 -14,694

Oregon -9,774 -2,355 -7,420 South Dakota -21,211 955 -22,166

Wisconsin -10,479 -3,341 -7,138 Montana -22,488 -3,494 -18,994

Cluster mix: a region’s particular mix of lower and higher average wage clusters

Relative cluster wage: a region’s cluster wage relative to the average national wage in that cluster

The cluster mix and the cluster wage level effects add up to the total difference between a region’s average wage and the

national average wage. On average, the wage level effect is responsible for 76.3% of the total difference in state wages to the

national average.

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Effect of Urban and Rural Areas on Average State Wages U.S. States, 2008

State

Average Overall Wage

Difference to U.S.

Metro-Rural Mix

Relative Metro Wage

Relative Rural Wage State

Average Overall Wage

Difference to U.S.

Metro-Rural Mix

Relative Metro Wage

Relative Rural Wage

New York 15,412 982 14,078 353 Nevada -4,560 815 -5,752 377

Connecticut 10,919 1,013 9,592 315 Louisiana -4,739 -630 -4,764 655

Massachusetts 10,197 1,674 8,333 190 Kansas -5,371 -2,175 -2,535 -661

New Jersey 8,488 1,631 6,765 92 North Carolina -5,505 -1,262 -3,796 -446

Alaska 6,538 -1,438 5,158 2,818 Tennessee -5,992 -538 -4,973 -481

California 5,584 1,476 3,844 265 Florida -6,132 -128 -6,074 70

Illinois 3,427 411 3,277 -261 Indiana -6,225 -630 -5,665 70

Washington 3,013 832 2,122 58 Oklahoma -6,501 -2,030 -4,496 25

Delaware 2,664 -191 2,895 -40 Hawaii -6,583 -1,892 -4,871 179

Maryland 2,201 1,159 775 267 Utah -7,054 169 -7,273 50

Virginia 1,182 509 709 -36 Vermont -7,280 -6,080 -968 -232

Minnesota 1,024 -903 2,130 -202 Nebraska -7,419 -2,652 -3,621 -1,146

Colorado 539 -110 -66 714 Alabama -7,544 -1,206 -5,701 -636

Texas 325 350 -234 209 Maine -7,697 -2,479 -5,243 24

New Hampshire -504 -2,856 924 1,428 Kentucky -7,978 -2,179 -5,285 -515

Pennsylvania -1,184 262 -1,480 34 Iowa -8,096 -3,123 -4,509 -464

Michigan -1,785 -165 -1,576 -44 New Mexico -8,531 -1,843 -6,548 -140

Rhode Island -2,143 1,720 -3,846 -17 South Carolina -9,137 -609 -8,203 -325

Wyoming -2,478 -6,929 -2,304 6,755 Arkansas -9,482 -2,207 -6,283 -992

Georgia -3,136 -120 -2,542 -475 Idaho -9,766 -1,928 -6,872 -966

Ohio -3,925 -224 -3,799 98 North Dakota -9,973 -2,963 -6,607 -403

Arizona -3,962 937 -4,897 -2 West Virginia -10,074 -3,104 -7,013 43

Oregon -4,116 -359 -3,505 -251 South Dakota -10,976 -3,811 -5,475 -1,690

Wisconsin -4,336 -910 -3,419 -7 Mississippi -11,446 -4,569 -5,493 -1,383

Missouri -4,540 -573 -3,103 -865 Montana -11,792 -5,468 -5,495 -829

Note: Data are based on private, non-agricultural employment.


Metro-rural mix: average wage impact from a state’s relative proportion of metro and rural regions

Relative metro wage: average wage impact from state relative performance in metro regions

Relative rural wage: average wage impact from state relative performance in rural regions

On average 66.3% of the average wage gap in a state is due to the metro wage effect.

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Composition of the Nebraska Economy

and Cluster Performance


Composition of Regional Economies, United States

Local Clusters

• Serve almost

exclusively the

local market

• Not exposed to

cross-regional

competition for

employment

71.7% of

employment

61.8% of income

3.5% of patents

27.4% of

employment

37.3% of income

96.4% of patents

Traded Clusters

• Serve markets in other

regions and countries

• Free to choose location

• Exposed to competition

from other regions

Source: Michael E. Porter, Economic Performance of Regions, Regional Studies (2003); Updated via

Cluster Mapping Project, Institute for Strategy and Competitiveness, Harvard Business School (2008)

Resource-based Clusters

• Location determined by

resource availability

• <1% of income,

employment, and patents in

the U.S.


Overall Composition of the Nebraska Economy, 2008

NE 30.0%

NE 69.8%

NE 0.2%

US 27.4%

US 71.7%

US 0.9%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Traded Clusters Local Clusters Natural EndowmentDependent

Perc

en

t o

f To

tal

Pri

va

te E

mp

loym

en

t

Note: Data throughout this section of the report are based on private, non-agricultural employment.



Composition of the Nebraska Economy Employment by Traded Cluster, 2008 Rank in US

Note: Ranks are among the 50 US states plus the District of Columbia. Source: Prof. Michael E. Porter, Cluster Mapping Project, Institute for Strategy and Competitiveness, Harvard Business School; Richard Bryden, Project Director.

Employment, 2008

1010501301401852102213073504136939351,0001,0601,3701,4721,8802,0912,120

2,7783,1583,2143,4033,8804,218

4,9435,5456,0476,609

8,9469,331

10,69511,369

12,56712,599

16,55823,784

44,20338,218

0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000

Fishing and Fishing Products 49Footw ear 37

Jew elry and Precious Metals 47Aerospace Vehicles and Defense 42

Leather and Related Products 45Aerospace Engines 36

Apparel 41Sporting, Recreational and Children's Goods 41

Furniture 45Pow er Generation and Transmission 48

Textiles 40Oil and Gas Products and Services 35

Biopharmaceuticals 36Motor Driven Products 33

Forest Products 43Lighting and Electrical Equipment 34

Analytical Instruments 40Construction Materials 30

Chemical Products 38Communications Equipment 23

Prefabricated Enclosures 25Entertainment 48

Production Technology 37Plastics 36

Building Fixtures, Equipment and Services 34Information Technology 37

Agricultural Products 17Metal Manufacturing 37

Medical Devices 22Publishing and Printing 33

Transportation and Logistics 38Automotive 23

Heavy Construction Services 39Hospitality and Tourism 43

Heavy Machinery 8Distribution Services 33

Education and Know ledge Creation 34Financial Services 26

Processed Food 14Business Services 34

Nebraska overall employment rank = 36


0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

-0.5% -0.4% -0.3% -0.2% -0.1% 0.0% 0.1% 0.2% 0.3% 0.4% 0.5%

Change in Nebraska share of National Employment, 1998 to 2008

Ne

bra

sk

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na

tio

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l e

mp

loym

en

t s

ha

re, 2

00

8

Employees 8,000 =

Composition of the Nebraska Economy Specialization by Traded Cluster, 1998 to 2008

Nebraska Overall Share of US

Traded Employment: 0.75%

Overall change in the Nebraska

Share of US Traded Employment:

+0.03.%


Added Jobs

Lost Jobs

Employment

1998-2008

Agricultural Products

(1.7%, +1.2%)

Heavy Machinery

Processed Food

Prefabricated

Enclosures

Construction

Materials

Financial Services

Medical Devices

Communications Equipment Business Services

Information Technology

Plastics

Aerospace Engines

Chemical Products

Production Technology


0.0%

0.2%

0.4%

0.6%

0.8%

1.0%

-0.2% -0.2% -0.1% -0.1% 0.0% 0.1% 0.1% 0.2%

Change in Nebraska share of National Employment, 1998 to 2008

Ne

bra

sk

a’s

na

tio

na

l e

mp

loym

en

t s

ha

re, 2

00

8

Employees 8,000 =

Composition of the Nebraska Economy Specialization by Traded Cluster, 1998 to 2008 (continued)

Nebraska Overall Share of US

Traded Employment: 0.75%

Overall change in the Nebraska

Share of US Traded Employment:

+0.03.%


Added Jobs

Lost Jobs

Employment

1998-2008

Analytical Instruments

Publishing and Printing

Business Services

Education and Knowledge Creation

Oil and Gas Products

and Services Furniture

Apparel

Power Generation and

Transmission

Entertainment

Hospitality and Tourism

Lighting and Electrical Equipment

Building Fixtures,

Equipment and Services

Heavy Construction Services

Biopharmaceuticals

Textiles

Forest Products

Motor Driven Products

Sporting, Recreational

and Children's Goods

Transportation and

Logistics

Metal Manufacturing

Distribution Services

Automotive


Nebraska Job Creation by Traded Cluster 1998 to 2008

Jo

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Net traded job creation,

1998 to 2008:

+18,705

Indicates expected job creation

given national cluster growth.*

Source: Prof. Michael E. Porter, Cluster Mapping Project, Institute for Strategy and Competitiveness, Harvard Business School; Richard Bryden, Project Director. * Percent change in national benchmark times starting regional employment. Overall traded job creation in Nebraska, if it matched national benchmarks, would be +12,813


$0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000

ApparelFootwear

Fishing and Fishing ProductsLeather and Related Products

Motor Driven ProductsJewelry and Precious Metals

Forest ProductsTobacco

Aerospace EnginesCommunications Equipment

BiopharmaceuticalsAerospace Vehicles and Defense

Power Generation and TransmissionEntertainment

Hospitality and TourismTextiles

FurniturePrefabricated Enclosures

Sporting, Recreational and Children's GoodsEducation and Knowledge Creation

Building Fixtures, Equipment and ServicesPlastics

AutomotiveTransportation and Logistics

Processed FoodMetal Manufacturing

Construction MaterialsPublishing and Printing

Heavy MachineryHeavy Construction Services

Production TechnologyDistribution Services

Medical DevicesBusiness Services

Lighting and Electrical EquipmentAgricultural Products

Chemical ProductsAnalytical Instruments

Oil and Gas Products and ServicesFinancial Services

Information Technology

Nebraska Wages by Traded Cluster vs. National Benchmarks

Wages, 2008

Nebraska average

traded wage: $41,024

l Indicates average

national wage in

the traded cluster.


U.S. average traded

wage: $57,706


Nebraska Employment in Highest Wage Clusters, 2008

Total private, non-agricultural employment in Nebraska: 805,791.


= 22.1% of

total private

employment


Furniture Building

Fixtures,

Equipment &

Services

Fishing &

Fishing

Products

Hospitality

& Tourism Agricultural

Products

Transportation

& Logistics

Nebraska Cluster Portfolio, 2008

Plastics

Oil &

Gas

Chemical

Products

Biopharma-

ceuticals

Power

Generation &

Transmission

Aerospace

Vehicles &

Defense

Lightning &

Electrical

Equipment

Financial

Services

Publishing

& Printing

Entertainment

Information

Tech.

Communi

cations

Equipment

Aerospace

Engines

Business

Services

Distribution

Services

Forest

Products

Heavy

Construction

Services

Construction

Materials

Prefabricated

Enclosures

Heavy

Machinery

Sporting

& Recreation

Goods

Automotive

Production

Technology Motor Driven

Products

Metal

Manufacturing

Apparel

Leather &

Related

Products

Jewelry &

Precious

Metals

Textiles

Footwear

Processed

Food

Tobacco

Medical

Devices

Analytical

Instruments Education &

Knowledge

Creation

LQ > 4

LQ > 2

LQ > 1.

LQ, or Location Quotient, measures the state’s share in cluster employment relative to its overall share of U.S. employment.

An LQ > 1 indicates an above average employment share in a cluster.


0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

-6.0% -5.0% -4.0% -3.0% -2.0% -1.0% 0.0% 1.0% 2.0%

Change in Share of National Employment, 1998 to 2008

Nati

on

al

em

plo

ym

en

t s

hare

, 2

00

8

Employees 2,000 =

Nebraska Share of US Heavy

Machinery Employment: 3.63%

Change in Nebraska Share of US

Heavy Machinery Employment: -0.19%


Added Jobs

Lost Jobs

Employment

1998-2008

Nebraska Heavy Machinery Cluster, 1998-2008 Specialization by Subcluster

Farm Machinery

Railroad Equipment and Rental

Machinery Components

Mining Machinery

Valves and Pipe Fittings

Construction Machinery


0.0%

2.0%

4.0%

6.0%

8.0%

-0.3% -0.2% -0.1% 0.0% 0.1% 0.2%

Change in Share of National Employment, 1998 to 2008

Nati

on

al

em

plo

ym

en

t s

hare

, 2

00

8

Employees 4,000 =

Nebraska Share of US Processed

Food Employment: 2.89%

Change in Nebraska Share of US

Processed Food Employment: +0.02%


Added Jobs

Lost Jobs

Employment

1998-2008

Nebraska Processed Food Cluster, 1998-2008 Specialization by Subcluster

Meat and Related Products and Services

Milling

Specialty Foods and Ingredients

(1.1%, -0.8)

Baked Packaged Foods Paper Containers and Boxes

Milk and Frozen

Desserts

Flour

Processed Dairy and

Related Products

Metal and Glass Containers Food Products Machinery

Malt Beverages

Coffee & Tea

Candy and Chocolate


Nebraska Top 50 Subclusters by National Employment Share, 2008

Rising national employment share

Declining national employment share

Subcluster Cluster Employment

Employment

Rank in U.S.

Employment

Share in U.S.

Change in

Employment

Share in U.S.

1998-2008

1 Small Vehicles and Trailers Automotive 1,750 4 12.0% 8.5%

2 Meat and Related Products and Services Processed Food 25,726 2 8.8% -0.2%

3 Farm Machinery Heavy Machinery 11,073 3 6.8% 0.2%

4 Trucks and Trailers Prefabricated Enclosures 1,750 7 6.8% 4.4%

5 Milling Processed Food 5,279 3 5.9% 0.2%

6 Agricultural Products Agricultural Products 3,935 8 3.6% 3.2%

7 Leather Tanning and Finishing Chemical Products 165 13 3.4% -0.7%

8 Biological Products Medical Devices 1,143 10 3.2% -0.2%

9 Steam and Air-conditioning Building Fixtures, Equipment and Services 60 21 2.9% -0.7%

10 Farm Material and Supplies Wholesaling Distribution Services 2,445 13 2.9% 0.3%

11 Electronic Capacitors Power Generation and Transmission 175 13 2.8% 0.7%

12 CeramicTile Heavy Construction Services 175 13 2.7% 2.6%

13 Rubber Products Construction Materials 913 13 2.7% 2.0%

14 Surgical Instruments and Supplies Medical Devices 4,323 18 1.9% -0.3%

15 Automotive Components Automotive 925 17 1.7% -3.4%

16 Ammunition Chemical Products 435 16 1.7% 1.1%

17 Insurance Products Financial Services 8,121 21 1.6% 0.2%

18 Mobile Homes Prefabricated Enclosures 633 17 1.6% 0.0%

19 Flour Processed Food 435 23 1.5% 0.1%

20 Heating and Lighting Building Fixtures, Equipment and Services 550 23 1.5% 1.3%

21 Switchgear Lighting and Electrical Equipment 490 23 1.4% -0.4%

22 Fabricated Metal Structures and Piping Heavy Construction Services 3,041 25 1.4% 0.2%

23 Catalog and Mail-order Distribution Services 4,646 24 1.4% 0.6%

24 Tile, Brick and Glass Construction Materials 435 20 1.3% 0.5%

25 Floor Coverings Building Fixtures, Equipment and Services 60 20 1.3% 1.3%


Nebraska Top 50 Subclusters by National Employment Share, 2008 (continued)

Rising national employment share

Declining national employment share

Subcluster Cluster Employment

Employment

Rank in U.S.

Employment

Share in U.S.

Change in

Employment

Share in U.S.

1998-2008

26 Diagnostic Substances Medical Devices 375 19 1.3% 0.9%

27 Electrical and Electronic Components Communications Equipment 985 23 1.3% -1.4%

28 Depository Institutions Financial Services 11,206 27 1.2% 0.6%

29 Electrical Parts Lighting and Electrical Equipment 750 24 1.2% -0.1%

30 Automotive Parts Automotive 5,320 20 1.2% 0.3%

31 Pipeline Transportation Oil and Gas Products and Services 465 21 1.2% 0.0%

32 Airports Transportation and Logistics 1,992 25 1.1% 0.3%

33 Specialized Machinery Motor Driven Products 60 29 1.1% 0.4%

34 Specialty Foods and Ingredients Processed Food 2,338 29 1.1% -0.7%

35 Professional Organizations and Services Business Services 19,525 27 1.1% -0.2%

36 Metal Processing Metal Manufacturing 2,545 25 1.1% 0.8%

37 Railroad Equipment and Rental Heavy Machinery 389 17 1.0% 0.6%

38 Farm Management and Related Services Agricultural Products 888 25 1.0% 0.2%

39 Baked Packaged Foods Processed Food 2,261 31 0.9% -0.1%

40 Communications Equipment Communications Equipment 1,135 20 0.9% 0.0%

41 Construction Machinery Heavy Machinery 850 26 0.9% 0.0%

42 Computer Services Business Services 4,589 32 0.9% -2.3%

43 Computer Programming Business Services 10,912 24 0.9% 0.2%

44 Motors and Generators Motor Driven Products 375 24 0.9% 0.4%

45 Laboratory Instruments Analytical Instruments 753 26 0.9% 0.5%

46 Publishing Publishing and Printing 3,573 27 0.9% -0.7%

47 Educational Facilities Education and Knowledge Creation 1,409 29 0.9% 0.2%

48 Machinery Components Heavy Machinery 235 27 0.8% -4.6%

49 Pumps Metal Manufacturing 292 23 0.8% -0.2%

50 Tourism Related Services Hospitality and Tourism 2,503 34 0.8% -0.1%


6,959

7,063

11,059

12,342

13,728

17,762

25,336

25,784

31,811

32,182

36,250

41,308

61,788

70,678

72,866

108,275

0 20,000 40,000 60,000 80,000 100,000 120,000

Local Industrial Products and Services 38

Local Education and Training 41

Local Utilities 36

Local Household Goods and Services 36

Local Entertainment and Media 35

Local Personal Services (Non-Medical) 36

Local Logistical Services 34

Local Community and Civic Organizations 38

Local Motor Vehicle Products and Services 36

Local Food and Beverage Processing and Dist 34

Local Retail Clothing and Accessories 36

Local Financial Services 32

Local Real Estate, Construction, and Develo 37

Local Hospitality Establishments 36

Local Commercial Services 36

Local Health Services 35

Nebraska Employment by Local Cluster 2008

Employment, 2008

Rank in US

Note: Ranks are among the 50 US states plus the District of Columbia. Source: Prof. Michael E. Porter, Cluster Mapping Project, Institute for Strategy and Competitiveness, Harvard Business School; Richard Bryden, Project Director.

Nebraska overall employment rank = 36


Nebraska Job Creation by Local Cluster 1998 to 2008

Jo

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0

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Net local job creation,

1998 to 2008:

+ 76,273

Indicates expected job creation

given national cluster growth.*

Source: Prof. Michael E. Porter, Cluster Mapping Project, Institute for Strategy and Competitiveness, Harvard Business School; Richard Bryden, Project Director. * Percent change in national benchmark times starting regional employment. Overall local job creation in Nebraska, if it matched national benchmarks, would be +83,761


$0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000

Local Hospitality Establishments

Local Retail Clothing and Accessories

Local Personal Services (Non-Medical)

Local Education and Training

Local Community and Civic Organizations

Local Food and Beverage Processing and Dist

Local Entertainment and Media

Local Household Goods and Services

Local Motor Vehicle Products and Services

Local Logistical Services

Local Real Estate, Construction, and Develo

Local Commercial Services

Local Industrial Products and Services

Local Health Services

Local Financial Services

Local Utilities

Nebraska Wages by Local Cluster vs. National Benchmarks

Wages, 2008

Nebraska average

local wage: $31,211

l Indicates average

national wage in

the local cluster.


U.S. average local

wage: $36,911


Appendix:

Chart Descriptions, Interpretation, and Sources


State Snapshot The snapshot chart summarizes the relative performance of a state on levels and trends in five key

measures. The circles in the chart indicate quintile of performance as shown in chart legend.

1. Prosperity: State GDP per capita and 10-year trend

2. Productivity: Average private wage and 10-year trend

3. Labor Mobilization: Total labor force as a share of civilian population and 10-year trend

4. Innovation: Utility patents per 10,000 workers and 10-year trend

5. Cluster Strength:

• A “strong cluster” is identified by relative employment rank in the top 20% across all states. A

state’s “cluster strength” is in turn the state’s total share of traded employment in these strong

clusters.

• A positive trend in cluster strength is indicated by a state’s increasing national cluster share

across these strong clusters.

Leading Clusters: A listing of the state’s strong clusters is included. A state may have more than five strong

clusters; the top five by employment size in the state are shown in this section.


Components of Regional Economies

Source: Cluster Mapping Project, Institute for Strategy and Competitiveness, Harvard Business School

A state’s or region’s economy can be divided into traded clusters, local clusters, and natural endowment

industries:

Traded clusters include those industries that compete across regions, and which tend to concentrate in

particular locations. Traded clusters are the engines of regional economic competitiveness. While they

account for only about a third of employment, they achieve the highest wages and productivity levels and

drive demand for localized businesses.

Local clusters involve activities serving almost exclusively the local market. Local clusters are present in

every region in roughly the same proportions. They employ the majority of people in any regional economy,

so their efficiency is critical for competitiveness in traded clusters. However, they cannot prosper over the

long run without success in the traded clusters.

Natural Endowment-dependent industries concentrate at natural resource sites. They account for a small

and declining share of national employment but can be relatively high wage.

The Cluster Mapping Project data presented in this report focuses primarily on traded clusters, though it

contains some information about other categories of industries. The performance of traded clusters holds

the key to present and future competitiveness.


Employment by Traded Cluster


Within the broad category of traded clusters, a state’s economy can be divided into individual clusters.

Clusters are geographically proximate groups of interconnected companies and associated institutions in a

particular field, linked by commonalities and complementarities. Examples include automotive producers in

Michigan and Ohio, information technology in Silicon Valley, and money management in Boston.

The 41 traded clusters (and their 264 component subclusters) utilized in the Cluster Mapping Project were

developed using statistical analysis of the actual patterns of business location in the U.S. economy.

Clusters and subclusters are listed at the end of this appendix.

Interpretation:

This chart gives total employment in the state economy by each traded cluster.

Employment by cluster gives a more detailed profile of the activities in the state economy that make up the

job base. It can be used to understand the importance of the health of various groups or industries on the

overall prosperity of the region. z

Also shown on the chart are employment ranks for

each cluster versus those in the 50 U.S. states plus

D.C. Ranks above the region’s overall share of

national employment are an indication of cluster

specialization in the state and are highlighted on the

chart.


Specialization by Traded Cluster


While other charts in this report focus on absolute employment and changes in employment, the

Specialization chart shows the region’s competitive position by traded cluster.

The size of each cluster “bubble” is proportional to the number of jobs in the region.

The location of each cluster bubble on the chart identifies a cluster’s relative performance in the US

economy:

• Clusters on the top half of the chart have local employment levels that are more than

proportionate to the region’s overall employment. These are clusters in which the region is

relatively specialized.

• Clusters on the right half of the chart are growing employment at a faster rate than the national

average for those clusters. These are clusters in which the region is gaining position in terms of

relative employment.

When present, a gray shaded area on the chart indicates that further detail is available on a second version

of the chart immediately following the current page.

Strong and growing position

Cluster is growing faster

The region’ share

of cluster employment Strong and growing

position

than the US average

relative to its size


Specialization by Subcluster

Strong and growing position

Subcluster is growing faster than average for the cluster

High share of national employment relative to average for the cluster

Strongest and fastest growing positions

The specialization by subcluster chart is interpreted similarly to the specialization chart for all traded clusters.

Additional insight on particular cluster strengths and trends in cluster composition can be observed.

Please note that only one or a few subcluster charts were included in this report. Specialization charts and

other data for all subclusters are available online at the Cluster Mapping Project reached from

www.isc.hbs.edu.

http://www.isc.hbs.edu/


Job Creation by Traded Cluster


This chart shows the overall net change in traded jobs in the state over the period from 1998 to 2008 and the

net gain or loss by traded cluster. The clusters are arranged in order of net jobs created. The blue bars

provide benchmarks for job creation based upon rates of growth in the cluster throughout the U.S.

Interpretation:

This chart allows a state to identify its biggest job generators and job losers among traded clusters over the

last decade. A few clusters often account for a large majority of the overall employment gain. Clusters with

job losses are a cause for concern. It is helpful to compare job performance with the policy priorities a region

has set.

Comparison of job growth relative to the U.S. benchmarks provides insights into the strengths and

weaknesses in the region’s economy and shifts in the region’s competitive position. A region might not be

participating in a cluster which is surging nation-wide; or a region might be gaining market position in an

important cluster.


Wages by Traded Cluster


The state’s clusters are listed in order by average wage. The yellow bars show the benchmark average

wage for the cluster nationally. The average wage across all traded clusters in the region is indicated by the

green dashed line.

Wages are a direct measure of a cluster’s productivity and competitiveness. Clusters that are exceptionally

productive (the value of output produced per unit of labor) can sustain higher wages.

Note: The wages for some clusters may not be reported due to data suppression in the underlying

government reports. When few employers in an industry are present in a given region, wage and precise

employment figures are omitted to protect the confidentiality of the data.

Benchmark lines provide a comparison to wages in the cluster across the U.S.


Employment in Highest Wage Clusters

The ten highest wage traded clusters in the state are shown in decreasing order, with the width of the

columns proportional to the number of workers in each cluster. The area of each cluster is thus equivalent to

the overall wage sum the cluster generated in the state.

The chart displays how the average wage in the state’s traded clusters is built up by highest

wage clusters. Some high wage clusters may have a small impact on overall wage levels because of their

small size, the case in some high wage clusters. Some large, high wage clusters are often those in services.

The comparison to the U.S. average wages by cluster (on the previous chart) gives an initial benchmark to

evaluate the composition of average wages in the state economy. States can increase wages in two different

ways: (1) increase the employment in high wage clusters relative to low wage clusters and/or (2) increase

the state’s relative wages in given clusters. In practice, the second effect dominates as the explanation for

why state wages differ.


Cluster Portfolio


Cluster Linkages

Our research on clusters, in addition to deriving a model of 41 distinct traded clusters, provides a measure

for the the strength of the links between these traded clusters. The strength of these links is summarized

visually in the portfolio diagram below by the relative positioning and overlapping of cluster circles.

Location Quotient (LQ)

The Location Quotient is a ratio measure of the concentration of a cluster in a state relative to that state’s

average share of employment in the U.S. traded economy. So, LQ is a measure of a cluster's level of

concentration within a state, with an LQ > 1 indicating higher than average concentration in that state.

Interpretation

Using Location Quotient as the measure of cluster concentration in the state, we overlay the state’s cluster

portfolio on the model of cluster linkages with three color levels as below. The pattern of a state’s portfolio

relative to the cluster linkages will often indicate paths of opportunity for development in clusters.


Top Subclusters by National Employment Share


This chart selects the sub-clusters in the region with the highest National Employment Shares. The

subclusters are grouped by cluster and ordered by subcluster National Employment Share.

Sub-clusters with a high share of national employment may form the basis for developing a competitive

position in a cluster. Strengths in a breadth of related sub-clusters are an indication of an established

position in a cluster.


Patents by Organization


This table lists by organization the top patent recipients in the region for the most recent five-year

period. Patents are assigned to regions according to the inventor’s address of residence. In the case of

multiple inventors from different locations, the patent is assigned fractionally to each region. Universities and

research institutes are highlighted in blue and government agencies in green.

Interpretation:

Patenting is the best single measure of innovation output. States and regions with a healthy level of

innovation tend to have patents originating from a variety of corporations across a number of fields as well as

significant patenting from universities and research institutes. Concerns about innovative capacity arise

when the patenting rate is low, patents originate principally from a government agency, or patenting is

dominated by only a few large firms.

Defining the Appropriate Region Massachusetts in BEA Economic Areas


A Note on Regions

The political boundaries of a state often encompass many distinct regional economies or portions of

larger regional economies. A comprehensive approach to economic development should reflect both the

distinct economies within a state as well as the often strong linkages to economies in neighboring states.

The map on the following page shows the intersection of the state with the Economic Areas defined by

the U.S. Bureau of Economic Analysis (BEA.) We find that the Economic Areas are a very meaningful unit of

geography for exploring the specialization and linkages in the U.S. economy. BEA's 179 economic areas

cover the entire U.S. and define the relevant regional markets surrounding metropolitan or micropolitan

statistical areas. They consist of one or more economic nodes - metropolitan or micropolitan statistical areas

that serve as regional centers of economic activity - and the surrounding counties that are economically

related to the nodes.

Please note that while this report has focused exclusively on the state, the website of the Cluster

Mapping Project reached from www.isc.hbs.edu provides similar data and analyses for all Economic Areas

(and Metropolitan Areas) in the U.S.

Note: There are 177 Economic Areas in the continental U.S. and one each for Alaska and Hawaii.



Defining the Appropriate Region Nebraska in BEA Economic Areas


Data from Bureau of Economic Analysis 2010.

Omaha-Council

Bluffs-Fremont, NE-IA

Sioux City-Vermillion,

IA-NE-SD

Kearney, NE Lincoln, NE Scotts Bluff, NE

Rapid City, SD


Traded Clusters and Subclusters in the US Economy

See http://www.isc.hbs.edu/cmp/help.html for Excel listing.


Aerospace Engines Chemical Products Furniture M etal M anufacturing Processed FoodAircraf t Engines Int ermediat e Chemicals and Gases Furnit ure Fabricat ed Met al Product s Milk and Frozen Dessert s

Precision Met al Product s Packaged Chemical Product s Wood Mat erials and Product s Met al Alloys Baked Packaged Foods

Ot her Processed Chemicals Furnishings Primary Met al Product s Cof f ee

Aerospace Vehicles and Defense Ref ract or ies Tableware and Kit chenware Precision Met al Product s Processed Dairy and Relat ed Product s

Aircraf t Leat her Tanning and Finishing Fast eners Meat and Relat ed Product s and Services

Missiles and Space Vehicles Ammunit ion Heavy Construction Services Wire and Springs Flour

Def ense Equipment Special Packaging Final Const ruct ion Met al Processing Specialt y Foods and Ingredient s

Treat ed Garment s Subcont ract ors Iron and St eel Mills and Foundries Milling

Agricultural Products Primary Const ruct ion Mat erials Nonf errous Mills and Foundries Candy and Chocolat e

Farm Management and Relat ed Services Communications Equipment CeramicTile Met al Furnit ure Malt Beverages

Soil Preparat ion Services Communicat ions Equipment Equipment Dist r ibut ion and Wholesaling Environment al Cont rols Paper Cont ainers and Boxes

Irr igat ion Syst ems Elect r ical and Elect ronic Component s Fabricat ed Met al St ruct ures and Piping Pumps Met al and Glass Cont ainers

Packaging Specialt y Of f ice Machines Explosives Saw Blades and Handsaws Food Product s Machinery

Fert ilizers General Indust r ial Machinery

Agricult ural Product s Construction M aterials Heavy M achinery Laundry and Cleaning Equipment Production TechnologyWine and Brandy Tile, Brick and Glass Const ruct ion Machinery Met al Armament s Machine Tools and Accessories

Cigars Plumbing Fixt ures Farm Machinery Process Equipment Sub-syst ems and Component s

Milling and Ref ining Wood Product s Railroad Equipment and Rent al M otor Driven Products Hoist s and Cranes

Cut and Crushed St one Mining Machinery Mot ors and Generat ors Process Machinery

Analytical Instruments Gum and Wood Chemicals Machinery Component s Bat t er ies Indust r ial Pat t erns

Laborat ory Inst rument s Rubber Product s Valves and Pipe Fit t ings Mot orized Equipment Fabricat ed Plat e Work

Opt ical Inst rument s Ref r igerat ion and Heat ing Equipment Indust r ial Trucks and Tract ors

Process Inst rument s Distribution Services Hospitality and Tourism Appliances Ball and Roller Bearings

Search and Navigat ion Equipment Merchandise Wholesaling Tourism At t ract ions Specialized Pumps

Elect ronic Component s Apparel and Accessories Wholesaling Tourism Relat ed Services Specialized Machinery Publishing and PrintingCat alog and Mail-order Wat er Passenger Transport at ion Tires and Inner Tubes Publishing

Apparel Food Product s Wholesaling Accommodat ions and Relat ed Services News Syndicat es

Men's Clot hing Farm Mat erial and Supplies Wholesaling Boat Relat ed Services Oil and Gas Products and Services Signs and Advert ising Specialt ies

Women's and Children's Clot hing Transport at ion Vehicle and Equipment Dist r ibut ion Ground Transport at ion Oil and Gas Machinery Phot ographic Services

Hosiery and Ot her Garment s Hydrocarbons Phot ographic Equipment and Supplies

Accessories Education and Knowledge Creation Information Technology Oil and Gas Explorat ion and Drilling Radio, TV, Publisher Represent at ives

Knit t ing and Finishing Mills Educat ional Inst it ut ions Comput ers Oil Pipelines Print ing Services

Research Organizat ions Elect ronic Component s and Assemblies Pet roleum Processing Print ing Input s

Automotive Educat ional Facilit ies Peripherals Oil and Gas Trading Paper Product s

Mot or Vehicles Pat ent Owners and Lessors Sof t ware Wat er Freight Transport at ion Services Specialt y Paper Product s

Aut omot ive Part s Supplies Communicat ions Services Inked Paper and Ribbons

Aut omot ive Component s Plastics Of f ice Equipment and Supplies

Forgings and St ampings Entertainment Jewelry and Precious M etals Plast ic Mat erials and Resins

Flat Glass Video Product ion and Dist r ibut ion Jewelry and Precious Met al Product s Plast ic Product s Sporting, Recreational and Children's GoodsProduct ion Equipment Recorded Product s Cost ume jewelry Paint s and Allied Product s Sport ing and At hlet ic Goods

Small Vehicles and Trailers Ent ert ainment Equipment Cut lery Synt het ic Rubber Games, Toys, and Children's Vehicles

Ent ert ainment Relat ed Services Collect ibles Mot orcycles and Bicycles

Biopharmaceuticals Ent ert ainment Venues Power Generation and TransmissionBiopharmaceut ical Product s Leather and Related Products Elect r ic Services TextilesHealt h and Beaut y Product s Financial Services Leat her product s Turbines and Turbine Generat ors Fabric Mills

Cont ainers Deposit ory Inst it ut ions Fur Goods Transf ormers Specialt y Fabric Mills

Securit ies Brokers, Dealers and Exchanges Coat ed Fabrics Porcelain, Carbon and Graphit e Component s Specialt y Fabric Processing

Building Fixtures, Equipment and Services Insurance Product s Relat ed Product s Elect ronic Capacit ors Text ile Machinery

Plumbing Product s Healt h Plans Accessories Yarn and Thread Mills

Drapery Hardware Risk Capit al Providers Prefabricated Enclosures Carpet s and Rugs

Fabricat ed Mat erials Invest ment Funds Lighting and Electrical Equipment Recreat ional Vehicles and Part s Wool Mills

Heat ing and Light ing Real Est at e Invest ment Trust s Light ing Fixt ures Mobile Homes Fibers

Furnit ure and Fit t ings Passenger Car Leasing Elect r ic Lamps Trucks and Trailers Finishing Plant s

Clay and Vit reous Product s Bat t er ies Casket s Specialt y Apparel Component s

Floor Coverings Fishing and Fishing Products Swit chgear Elevat ors and Moving St airways Women's and Children's Underwear

St eam and Air-condit ioning Fish Product s Elect r ical Part s Of f ice Furnit ure Tire Cord and Fabrics

St one and Tile Work Fishing and Hunt ing Met al Part s Household Ref r igerat ors and Freezers

Wood Cabinet s, Fixt ures and Ot her Product s Processed Seaf oods Aluminum Processing TobaccoConcret e, Gypsum and Ot her Building Product s M edical Devices Cigaret t es

Footwear Surgical Inst rument s and Supplies Ot her Tobacco Product s

Business Services Foot wear Dent al Inst rument s and Supplies Tobacco Processing

Management Consult ing Specialt y Foot wear Opht halmic Goods Specialt y Packaging

Online Inf ormat ion Services Foot wear Part s Medical Equipment

Comput er Services Diagnost ic Subst ances Transportation and LogisticsComput er Programming Forest Products Biological Product s Air Transport at ion

Phot ocopying Paper Product s Bus Transport at ion

Market ing Relat ed Services Paper Mills Marine Transport at ion

Prof essional Organizat ions and Services Paper Indust r ies Machinery Ship Building

Engineering Services Pref abricat ed Wood Buildings Transport at ion Arrangement and Warehousing

Laundry Services Wood Part it ions and Fixt ures Trucking Terminal

Facilit ies Support Services Airport s

Bus Terminals

http://www.isc.hbs.edu/cmp/help.html

http://www.isc.hbs.edu/cmp/help.html


About This Report

This report was prepared in conjunction with Prof. Michael E. Porter’s presentation before the National

Governors Association Winter Meeting on February 26, 2011. It draws on data and analysis from the Cluster

Mapping Project and other sources at the Institute for Strategy and Competitiveness, Harvard Business

School; Richard Bryden, Project Director. Additional information may be found at the website of the Institute

for Strategy and Competitiveness, www.isc.hbs.edu. None of this information may be duplicated,

disseminated or copied without express written consent from the Institute for Strategy and Competitiveness.

This report is available electronically at http://www.isc.hbs.edu/stateprofiles.htm.


http://www.isc.hbs.edu/stateprofiles.htm

Documents

Nebraska Competitiveness: State and Cluster Economic Performance