Regional Innovation Spotlight: Pittsburgh and Western Pennsylvania

Amid the current debate in Washington, DC, around U.S. competitiveness issues, BPC has been crossing the nation to gather local perspectives through roundtable discussions with private and public sector leaders. One of these conversations included a stop in Pittsburgh, PA to hear how competitiveness is defined and supported in the region, from local infrastructure to workforce preparedness.

Why Pittsburgh?

“The history of industrial and material innovation exists to allow [our] rebuild, but we must mobilize around a shared vision for the future.” – Roundtable participant

Industry growth and innovation have always been at the heart of Pittsburgh’s regional competitiveness. Several top companies and industries like the Kraft Heinz Company and U.S. Steel, as well as a dynamic energy production sector remain integral to its success. Historically known as the “Steel City,” Pittsburgh’s growing industry diversity—including life sciences, health care, business services, robotics, climate technology, and manufacturing—help drive its regional talent and economic activity today. Moreover, research initiatives driven by world-renowned local universities like Carnegie Mellon University and the University of Pittsburgh are shaping the region’s future as a technology incubator. As a result, top firms are flocking to the area to open new campuses, distribution centers, and more.

Pittsburgh is, however, notoriously home to an older workforce: Employment recovery from the pandemic is in the bottom-fifth among the nation’s approximately 400 metropolitan statistical areas, implying that prime age workers have left the region for jobs elsewhere. Over the past year though job gains across the professional and business services, leisure and hospitality, and education and health services sectors indicate positive signs that intentional investment in a resilient workforce and innovative initiatives will continue to drive regional competitiveness.

All Policy is Local

“Equity must be baked into the federal grantmaking process.” – Roundtable participant

 In 2022, the Southwestern Pennsylvania New Economy Collaborative was one of 21 finalists awarded a nearly $63 million federal Build Back Better Regional Challenge (BBBRC) grant by the U.S. Economic Development Administration to transform local economies and enhance U.S. competitiveness. The grant presents the region with a dynamic opportunity to unite incubators and innovators across its robotics and autonomy technology sector— ensuring that all have a seat at the table, not just those who can afford to apply. Roundtable participants emphasized this aspect, saying that work should be centered around uplifting underrepresented businesses to reinforce the need for inclusive ecosystems, which will in turn drive regional competitiveness.

While funding from BBBRC is crucial to jumpstarting innovation and growth, participants noted that overly prescriptive grant metrics can unintentionally hinder program success. Supply chain corridors span beyond Allegheny County—from Dauphin to Butler and Venango counties, for example—to connect businesses throughout the state. Grants and funding streams, however, can limit the scope of use, essentially cutting off crucial service connections that constrain the ability to collaborate and innovate. For instance, participants shared that grants might only include five of six relevant counties, meaning that someone is cut off from the chain entirely, which can hurt all businesses involved.

From the “Rust Belt” to the “Smart Belt”

“Pittsburgh is no longer the same blue-collar steel city that it once was, it can be reinvented.” – Roundtable participant

At the local level, counties are leading community development initiatives to transform industries and break down siloes that have long hindered regional change. The whole supply chain needed—whether for manufacturing, technology, and energy—exists within this regional corridor. One participant shared a desire to capitalize on this: “Everything that is being designed (e.g., robotic arms) down here [southwestern PA] can be built here too. The tools to make it and the production capacity exist, but we need a systematic approach to connect the chain. Pittsburgh is the hub, but how do we build out those spokes locally and statewide?” As such, concentrating efforts in only a few counties—or the “Southern 6”—is not sufficient for continued growth.

Coordination and collaboration are thus crucial to aligning businesses around a collective vision that transforms “the Rust Belt into the Smart Belt.” This requires adapting existing assets, such as abandoned mills and buildings to reinvigorate the existing manufacturing and energy sectors, while simultaneously staying focused on the future and what the region could be. Transformation at scale, however, can be hard for those unsure of what technological integration can mean for their business. “There are lots of independent projects happening, but we’re trying to create a hub to bring together and speak to this with one voice.” Cohesion requires buy-in, and the first step is a clear vision of how they can accomplish improved services—from the start of the project to final outputs—that are non-threatening to those who are change resistant. Bringing people to the table and demonstrating the advantages of working together—rather than directly competing—and developing a process to do so will drive modernization efforts and spur renewed regional economic success.

Building a Resilient Workforce for a Changing Economy

“There can be a real alignment of stars, particularly [between] high schools and employers.” – Roundtable participant

Amid rapid change, participants emphatically agreed that comprehensive conversations on workforce issues are central to competitiveness. With increasing technological advancements, workers crave validation to understand how they fit into a future alongside—not replaced by—new technology. One participant remarked, “How are we going to get the manufacturing workforce excited about being in manufacturing?”  

But creating enthusiasm for the future is only the first step; creating opportunities to access training that help workers secure this future is crucial. Much of this starts with reconfiguring the education system to address workforce needs. Developing partnerships with elementary schools, community colleges, pre-apprenticeship programs, and child care centers can help employers identify the needs of these growing industries and workers and better design training programs. Moreover, institutional anchors already exist, particularly throughout the Penn State system, and intentionally bringing them into the ecosystem enhances opportunities for collaboration. Participants also stressed a need to revamp the educational curriculum and career pathways at a young age to start building a workforce for the future. Several reflected on integrating technical programs into the education system for students as early as “five to six years old.” Seeking out alternatives to offer programming outside the traditional school year also allows for continued access points that enable younger generations to see the career trajectories available to them in Pennsylvania.

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BPC is grateful to Carnegie Mellon University’s Heinz College for hosting this roundtable and to all participants for their candor, insight, and good company.

Where should we go next? Contact BPC Managing Director of Strategic Initiatives Dane Stangler with your thoughts—and if you’d like to help!