When anchors call the shots: what Amazon and the European Medicines Agency have in common

Many ‘anchors’ – institutions that have a long-term, stabilising presence in a community, and coordinate economic and social activity – are established in an area because of the very characteristics of that area. Think hospitals needing to serve a growing population, or a university near colleges, industry and other intellectual activity. Yet a new breed of anchor institutions have arrived: born unrooted, they float high and unencumbered by place until they are enticed to a city by an offer they can’t refuse.

Two recent examples showcase this. First, Amazon is inviting metropolitan areas in the US to bid to host the company’s second headquarters. The prize?

Amazon will hire as many as fifty thousand (50,000) new full-time employees with an average annual total compensation exceeding one hundred thousand dollars ($100,000) over the next ten to fifteen years, following commencement of operations. The Project is expected to have over $5 billion in capital expenditures.

Areas are expected to meet strict criteria, including a highly educated workforce and a ‘strong university system’. The Centre for Cities cover the ins and outs of Amazon’s invitation nicely, concluding that ‘firms like Amazon need cities as much as cities need firms like Amazon’. But it appears that Amazon have the upper hand.

Second, the UK’s vote for Brexit has effectively booted the European Medicines Agency (EMA) out of London. The EMA’s Canary Wharf headquarters is home to 890 staff and 36,000 annual visitors. EU countries have been bidding to host the EMA, who have also issued a set of criteria for interested parties. Yet, in this case, existing staff have been particularly influential. Reuters reports that

A staff survey last week found that between 19 and 94 percent of employees were likely to leave after the move, depending on which location was chosen. Picking Amsterdam, Barcelona, Vienna, Milan or Copenhagen as the new headquarters would be the best option for retaining staff, the survey found.

In both cases, the more connected, more open, more liveable cities with a skilled, educated population are in a far stronger position to attract a floating anchor institution. And as the most successful cities (and the principles of agglomeration) have shown, once you have one anchor it’s much easier to attract further anchors.

Two ways to push university-business collaboration

At the core of increasing collaboration between universities and businesses is getting people from each to talk to one another.

I’ve written elsewhere about the benefits of collaboration. When universities work with businesses, economic growth happens. Broken down further, when universities work with businesses, businesses can access new technology and knowledge and apply this to their work, become more innovative, and improve the skills of their staff. Universities can improve the employability of their students, and test new research in a ‘real world’ setting. When the two work together, new jobs are created, productivity increases and everybody benefits.

At least, that is how the theory goes. How does this work in practice? Strip collaboration to the core and you’re left with the need for people from universities to speak to businesses, and vice versa. Here are two ways to encourage this – one nudging businesses towards universities, and one students towards small employers:

  1. Innovation vouchers provide funding for businesses to access external expertise. They reduce the risks that businesses (especially small ones) face, and can attract larger investments and build partnerships. Appropriately tailored and effectively marketed, these relatively small investments benefit universities and businesses, and long term can boost growth and employment. You can read more on how vouchers work and their benefits from the OECD and Universities UK.
  2. Careers services can promote the benefits of working for small and medium sized enterprises (SMEs), and encourage students to take up a placement, internship or job at an SME. Students may have misconceptions about small businesses – that they aren’t as innovative as multinationals, for example – that can be dispelled by a few well-chosen case studies.

The CBI recently published an excellent guide to university-business collaboration with a practical focus. Although this, and the above links, are UK- or European-focused, they are equally applicable (with tailoring to local context) to low-income countries. This is a particularly exciting area and a source of long term economic growth and innovation.