In celebration of Asheville Entrepreneurship Week, the AVL Digital Nomads, Economic Development Coalition, and Venture Asheville came together to present Understanding the Asheville Economy.

Senior Vice President of Economic Development Clark Duncan, along with Director of Venture Asheville Jeffrey Kaplan, shared some insights into the structure, goals, and strategies for economic development in the Asheville Metropolitan Statistical Area.

The Asheville Area Chamber of Commerce comprises 1700 members and has a goal of expanding economic opportunity around Western North Carolina. The Asheville Chamber is host to the EDC, and Venture Asheville is its core initiative. These are funded 1/3 by public dollars from the city and county, 1/3 by capital campaigns, fundraisers, and foundations, and 1/3 by earned revenue of these programs. 

Previously finding that 23 WNC counties lagged behind there rest of the state in economic productivity and wage growth, the Economic Development Coalition focuses on expanding economic opportunity for the region. While the area has a growing tax base to fund infrastructure and education needs, the EDC also looks to the private sector so these costs don’t entirely fall on area residents. Creating career ladders in a diverse economy focused on the next generation provides economic opportunities for the future, which is strategic for creating the economic base that will support the region moving forward.

Currently comprising 475,000 residents within the Asheville MSA, 45,000 more individuals are projected to relocate to the area by 2030. Despite the shortages in the local workforce, the area is growing and providing elasticity for the workforce population, which during the height of the pandemic numbered 197,000 individuals, and has since recovered to more than 205,000 currently. With approximately 70,000 college graduates annually within 100 miles of Asheville, many local employers are partnering with universities to establish a presence with the rising workforce.

While tourism is the most visible industry in the MSA, Duncan said the largest industry is Healthcare, with one in five residents employed within that sector. The fastest growing industry in the MSA has been professional and technical services, which has seen year-over-year increases for 20 years. This sector includes legal services, architects, consultants, human resources specialists, and technology developers which support growth of the entire economy. Other large industries include retail, government, and manufacturing.

Every five years, the EDC conducts research on clusters of target industries to learn what areas are effectively growing jobs, especially higher-wage jobs, for the area. Many regions have their own ‘specialization,’ and specifically in the Asheville MSA, there are 20 to 30 times more brewing professionals than other areas of the country, which attracts outside investment in this sector. There has also been rapid growth in aerospace manufacturing over the last 50 years, as well as growth in automotive manufacturing.

Some major corporations are recruited to relocate to the area, and factors influencing business recruitment include available workforce, real estate, connectivity, costs of energy, and resource availability. Some major businesses including hotels are not recruited, rather they establish their presence where the demographics and visitation numbers justify profitability. Working with the City, County, and the State, businesses may be offered incentives to relocate to the area, though NC offers less competitive incentives than other states in the Southeast. The top incentive, according to Duncan, is the State’s investment into its community college and education systems as many companies look five to 10 years ahead in examining labor pools and talent pockets in area populations. Not all expansion has been from outside corporations; 68% of the area’s economic expansion has consisted of local businesses and industries, and the 30% that come from outside areas are complementary and not all are incentivized.

Community development is closely linked to economic development. The City of Asheville and Buncombe County are offices of community development, focusing on issues like affordable housing, human services, access to childcare, and more. Duncan said availability of housing and childcare can be a constraint on how business development and job creation grows.

Diversity of industry and initiatives will move the needle for increasing wages, which aligns with the quality of life and value to the region. Duncan said the area is “at the front door” of a lot of industries looking to locate here, possibly including the manufacturing of electric vehicles and their associated products like chargers. Also, the NC Department of Commerce and the Economic Development Partnership of North Carolina are large lead sources for businesses potentially coming to the Asheville area.

The EDC and its public partners are highly selective in how they use tools to accomplish community goals. New Belgium’s arrival in 2012 involved a $175 million private sector investment and resulted in a revitalized greenway, diversity of arts and culture amenities, a platform for apartments in the River Arts District, and the reclamation of 13 miles of wood that was reused in the construction of the facility. Duncan said this is an example of how economic prosperity can be balanced with environmental prosperity, leaving tremendous impacts on remediating rivers and otherwise improving the area’s environment.

Venture Asheville, an EDC initiative, focuses on growing local businesses from the ground up. Their goal is to build entrepreneurships, partnering with entrepreneur support organizations around the region and focusing on mentorships. Venture Asheville also works with a group of 150 angel investors, hosting competitions and helping people get into their pipeline, which can be impactful for founders of these companies. 

Since its inception, Venture Asheville has helped local businesses produce $109 million in revenue and $56 million in salary, creating jobs with an average annual salary of $82,000. As these entrepreneurs are growing their businesses, they are also becoming community leaders, giving back directly and offering returns to the community in various forms.

Long-term plans for Venture include determining shortcomings of economic participation and thinking differently about barriers to employment. Kaplan said he’d like to shine a bright light on investing in these barriers including individuals in recovery and coming out of incarceration or poverty. Community prosperity will help the economic ecosystem become more successful, and their goal is to determine what they can be doing more of so the prosperity is more broadly shared.