However, there is great concern that the past decades’ economic success may have been part of a nonsustainable bubble, hiding the fact that Ohio’s economic competitive strength was being eroded by changing economic drivers, including outsourcing, declining real-dollar investment in domestic research and development (R&D), and the rise of a new breed of technology-savvy global competitors. In this fast-paced, global economic paradigm, innovation initiatives are no longer just an important endeavor, but an absolute necessity for the state’s economic competitiveness moving forward. In an interesting paradox, the more global and integrated the economy becomes, the more local R&D know-how, entrepreneurial culture, workforce skills, and manufacturing competencies matter for economic success. Even with Ohio’s proactive stance in cutting-edge innovation and economic development initiatives, global competition and continued technological advancements requires Ohio to embrace new paradigms to ensure its investments are impactful and far reaching.

Today, Ohio’s citizens are concerned that the state’s economy is not as strong as it needs to be and, as a result, is falling behind the nation and competitor states. Since 1968, often thought to be the height of the industrial economy, Ohio’s gross domestic product (GDP) per capita (a leading indicator of a region’s standard of living) has remained stagnant while the nation’s continues to increase, indicating that Ohio is losing ground.

As innovation’s role in driving economic growth continues to increase, Ohio’s economy falls further behind. Ohio’s private sector average annual GDP growth rate from 1991–2016 was 6.7 percent compared with the U.S. average annual GDP growth rate of 8.8 percent—behind by more than 2 percent per year over the 26-year period. This slower economic pace, directly or indirectly, manifests itself in the following:

• Slower population growth—Ohio’s total population during the 1991–2016 period grew by 6.1 percent, compared with 27.7 percent for the United States overall.
• Slower growth in per capita income—Ohio’s per capita income, in real terms (USD 2016), grew by 1.38 percent from 1991–2016, to $44,593, compared with the U.S. growth rate of 1.63 percent reaching $49,246.
• Slower growth in real wages—Ohio’s average wage, in real terms (USD 2016) grew by 17 percent from 1991–2016, compared to U.S. average wages that grew by 26 percent over the same period.
• Lower median household income—Ohio’s median household income grew by 3.2 percent during the 1991–2016 period, compared with the United States growing at 3.8 percent during the period.
• Increase in levels of poverty—Ohio’s share of people in poverty increased by 0.3 percentage points from 1991–2016, reaching 13.7 percent, while the U.S. levels saw a decline of 1.5 percentage points to 12.7 percent.

These key economic indicators are of grave concern to key thought leaders across the State of Ohio. Recognizing the opportunity to rethink strategic public policy initiatives in light of a new administration coming into office, the Ohio Chamber of Commerce Research Foundation, in partnership with regional Chambers of Commerce, commissioned this study to develop a blueprint for public policies that will help secure Ohio’s position as a leader in the tech-based/innovation economy.