Florida's Economic Drivers

 
 
 
Florida’s success in developing and applying innovation and fostering emerging businesses will shape the economy well into this century. The state needs to develop an environment that encourages the development and application of new technologies while nourishing the businesses and workers that will lead this innovation.

The state already has taken steps in this direction but the innovation gauge leans slightly negative due to:

  • Global capital seeking other markets
  • Early stage and venture capital markets down
  • Modest gains in university and industry R&D spending, still well below competitor states and nations
For a decade, the High-Tech Corridor from Tampa through Orlando and Gainesville has helped develop spinoff research and high-technology firms through their association with the University of South Florida, University of Central Florida and the University of Florida.

The University of Florida has risen to seventh in the nation among colleges for its earnings from licensing fees. The $40.3 million UF takes in annually from license income tops that generated by MIT or CalTech.

The state has been aggressive with its courting of out-of-state firms by maintaining significant financing in its “Quick-Action” Closing funds, providing incentive cash or relocation assistance to job-bearing companies looking to relocate here.

Emerging businesses are particularly important because they are projected to make the largest contribution to economic growth in Florida over the next decade. High-growth, entrepreneurial firms can develop and adapt to new technologies rapidly, taking advantage of new market opportunities.

Regions with high levels of research – such as those across the Interstate-4 corridor – may spawn new companies that may develop into tomorrow’s large corporations, drawing on the model that has seen industry blossom in California’s Silicon Valley, Massachusetts and Washington state. Research also keeps existing companies competitive.

Florida’s research efforts, however, are modest compared with other states. Florida is at a disadvantage in terms of its ability to generate new discoveries, with R & D spending representing less than one percent of the state’s gross state product, compared with more than two percent nationwide. University R & D funding had doubled over the past decade, but remains low compared with competing states.

The technology transfer and commercialization process also has lagged in Florida, reducing the number of new discoveries that make it to market. The total number of patents issued to Florida businesses has not changed significantly since 2000, ranking only 31st among the 50 states on a per-worker basis. During this period, though, patents to universities have climbed by 18 percent – boosting licensing dollars by five percent.

With the nationwide economic slump and tight credit markets, the availability of risk capital for new and emerging businesses also appears troubled. Even before the economy soured, Florida accounted for just 1.2 percent of the nation’s venture capital investments and less than one percent of seed and early-stage capital, according to Enterprise Florida.