Utah moves to identify economic 'clusters'

State officials want the Utah Technology Industry Council's help in identifying economic "clusters," but the first step is establishing the methodology to do it.

Another challenge apparently is understanding the definition of clusters and how they differ from "economic ecosystems," a phrase common during the administration of former Gov. Mike Leavitt.

Martin Frey, co-director of the state Department of Community and Economic Development, is coordinating the cluster identification project. He said the state hopes to announce the clusters in June and establish specific cluster development plans in August.

"It's all due in two months, so it's going to happen fast," he said at a Thursday council meeting.

A cluster, he has said, involves targeted industries in which Utah can be "best in class." On Thursday, he said they include existing industries plus those where Utah can have a significant market share or critical mass in an emerging technology.

"A cluster is a technology area that is strategically important to the state, regardless of whether we're competent or capable to a large degree in that area," he said, adding later that the areas need not be technology-related. Ladd Christensen, the department's other co-director, suggested financial services as an example of the latter.

Frey said that in some cases, individual companies are not working together to their mutual benefit, citing global information mapping firms.

"This is a cluster, right? . . . The problem we have is they're not working together at all. They're all siloed. They don't think about partnering. They think of each other as competitors rather than forming a synergistic kind of relationship and going after larger contracts. That's how we can help ourselves without adding anything new — bringing those individuals and companies together.

"We've got some very interesting nuggets all over the place, and I think we just have to align ourselves in ways that's really going to enable us to build on our own strengths in ways that we haven't in the past."

Christensen said the ultimate result would be companies with "greater strengths, greater opportunities to succeed." And those companies tend not to leave their homes because of that strength, meaning the cluster concept would help the state both recruit new businesses and retain existing ones.