Springfield FutureCity 2026: Consultant urges more support for small businesses
Updated Jan 07, 2019; Posted Jun 06, 2016
Officials from Springfield and CRRC tour rail car manufacturing site in Springfield
Gallery: Officials from Springfield and CRRC tour rail car manufacturing site in Springfield
By Jim Kinney | jkinney@repub.com
SPRINGFIELD -- Nearly three-quarters of Springfield's companies are small businesses with fewer than four employees. That is around 20 percentage points higher than the Massachusetts and nationwide averages, which place about half the businesses in this smallest category.
This is according to FutureCity 2026, an economic development strategy prepared for the city, the Springfield Regional Chamber of Commerce and DevelopSpringfield, the city's public-private economic development agency, by New York City consultants Newmark Grubb Knight Frank Global Corporate Services.
The report said, in part, that the city and its boosters can't get too enamored with big development projects like the CRRC MA rail car factory in East Springfield or the MGM Springfield casino project in the South End -- lest it forget the little guys and the business climate that helps those small enterprises flourish.
"That ratio was really quite striking," said Jay Minkarah, president and CEO of DevelopSpringfield. "It suggests that a strong small business focus is going to be very critical to any strategy that we have moving forward. It also suggests that a lot of the things we are working on right now around entrepreneurship and business incubation are really things we need to keep doing."
Newmark presented an early executive summary of its report recently to the chamber, DevelopSpringfield, city officials and others in the form of a 36-slide PowerPoint presentation reproduced below.
The report lists Springfield's assets -- Bradley International Airport, freight railways, robust broadband Internet, higher education institutions -- as well as some of the things that make it tough to do business here. The challenges list includes a lack of skilled workers in certain industries, a lack of shovel-ready sites to build on, a lack of activity downtown and concerns about public safety.
In a few weeks, Newmark will follow up with a more detailed report including 171 specific recommendations. They might range from providing job readiness training for welfare recipients to better lighting downtown to providing a one-stop place for those small businesses to get help.
The list will be divvied up and assigned to government, private sector groups and others. Those groups -- including the chamber, the Economic Development Council of Western Massachusetts and the Business improvement District -- will take responsibility for the tasks assigned to them and will be held accountable for results, Minkarah said.
"We want people to take ownership of this process," Minkarah said. "We don't want it to be a plan that sits on a shelf."
As the name suggests, the process is supposed to yield an economic development plan that can shape the city over the next 10 years, or from now until 2026.
About a year ago, DevelopSpringfield and the chamber realized they were both working on similar action plans. They decided to partner and after a national search hired Newmark, which mostly specializes in helping corporations find places to get established or to relocate existing operations.
The study -- which Newmark said included seven visits to Springfield totaling 20 days during which staffers completed 102 interviews -- cost $170,000, Minkarah said. Funding came from DevelopSpringfield, the chamber, the Davis Foundation, the Community Foundation of Western Massachusetts, Smith & Wesson and a $40,000 grant from the federal government.
Chamber president Jeffrey Ciuffreda said he's glad the report doesn't read like something from, well, the Chamber of Commerce. He said he asked for no sugarcoating and feels he get the straight story.
"We know we need to do better. We need to do better in our education system," Ciuffreda said. "We need to tie our education system into our workforce development. We know we need to work with the mayor to address the crime problem."
The plan calls for that kind of cooperation, and for specific steps like improving downtown lighting to increase the perception of safety.
"It all starts with jobs," Ciuffreda said. "This gives us hope that we can chip away at our unemployment problem."
Last week, the state and federal governments announced that Springfield's unemployment rate had fallen to 7.2 percent, its lowest point in nine years.
"That 7.2 percent is still 70 percent higher than the state average," Ciuffreda said. "We must close that gap."
Kevin Kennedy, Springfield's chief development officer, said some of Springfield's minuses are things the city can't do much about, like the utility costs. But the city works hard on property taxes.
Also, assembling a large place to build a new plant can be hard in a city where parcels are small and owned by many different people. CRRC MA is building at what had been a mammoth Westinghouse Electric factory until the 1970s.
A proposed state law would make it easier to assemble and redevelop old industrial sites in cities like Springfield, Kennedy said. Gov. Charlie Baker's proposed economic development bill could create a $25 million, five-year site assembly and pre-development improvement fund. The bill is pending before the legislature.
Ciuffreda said this study is reverse-engineered in a way because Newmark spends most of its time helping companies find places to locate or expand. So the city is helping get the perspective of those it is trying to impress.
Newmark used that expertise to identify 53 companies that would be good short-list prospects for moving to Springfield, including many in the food-processing industry, which city officials had not considered up to this point. Newmark promised to reveal the list to the steering committee, but not the public.
NGKF FutureCity - Final Report Executive Summary FINAL 5.25.16 2026