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Pause, Pivot, Reimagine

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Melissa Everett is the executive director of Sustainable Hudson Valley.
  • Melissa Everett is the executive director of Sustainable Hudson Valley.

The current economic collapse is like no other. In a few short months, over 20 million people have lost their jobs while over a million have gotten sick with coronavirus and many more have been under virtual lockdown to fight the virus. The crisis and response have revealed structural problems in the economy, including an inadequate supply chain and limited planning capacity for essential supplies. Because entire industries are reeling, from hospitality and tourism to commercial real estate, many people will need to reorient their careers while coping with the trauma of the situation.

Business leaders and economic development practitioners are waking up quickly to the levels of adaptiveness and resourcefulness that will be needed to restore economic health and reshape the system for greater resilience. Michael Oates, president of the Hudson Valley Economic Development Corporation, cites one example: commercial real estate. "There has been an enormous disruption in the real estate market with so many people working at home successfully. How do we reposition empty commercial properties for creative uses? It may be incubating spaces, shared work, and things that will allow us to be more creative. How can we foster more entrepreneurship, especially in minority communities? Can we take these interconnected crises and come up with solutions that increase the diversity of opportunity?"

The art of the pivot was a theme in business leadership well before COVID-19. In April, IDEO, a collaboration platform, announced the COVID-19 Business Pivot Challenge to learn how businesses were using this crisis to redirect their efforts into areas of new opportunity to serve.

In three weeks, 29,000 people visited their website. Six hundred and ninety-nine project ideas were submitted, representing 36 industries and 71 countries, and 73 percent were from small business. For example,

• ORamaVR is a technology startup that created a virtual approach to accelerated COVID-19 medical training in partnership with NYU Medical Center.

• NODE, a sustainable home construction business, pivoted to produce treatment and quarantine centers that can be repurposed for affordable housing.

That kind of inventiveness is visible throughout the region, in the distilleries that shifted to producing sanitizer and the farm businesses that changed their production plans to address local hunger. It even shows up in the use of novel economic tools like the alternative currency developed for our region, the Hudson Valley Current. Participants (anyone) can use this tool as a medium of exchange at participating businesses within the region—but not beyond—keeping the wealth local. The Current team made a major pivot in the crisis to create a community food and resilience marketplace which will continue in the new normal.

But creative business efforts won't be sufficient without positive policies. While renewable energy has been a main focus of discussions of a Green New Deal and future stimulus funding, that is not the only major job creator. New York Sustainable Business Council Executive Director Bob Rossi observes that "water is the backbone of our economy. So much depends on it—tourism and recreation, food and beverage, and the health of our communities. When water is polluted, people get sick and businesses have to invest more in purification technologies. Investing in water infrastructure is a job creator that pays back richly."

But the complexity and sudden onset of the crisis reveals more complex issues in the economy. Dennis Meadows, coauthor of Limits to Growth, observes in a recent post that industry's drive to greater and greater efficiency can actually undercut resilience by reducing resource reserves and organizations' capacity to buffer against stress. "Over the past century, there has been wholesale abandonment of resilient systems in favor of efficient systems—larger scale, less diversity, lower redundancy."

Health care is one example. "There has been a relentless effort to reduce personnel levels, eliminate 'unnecessary' stocks of supplies, and shift drug production overseas—all to reduce costs, i.e., make the system more efficient," Meadows writes. "Many have profited by optimizing the health system to be extremely efficient in its use of inputs. Now we all are paying the costs for the resultant loss of resilience. COVID-19 has shown how quickly interrupting some inputs, such as masks, can cause drastic declines in essential outputs, such as the quality of health care."

Fortunately, there is interest in more systemic approaches. A private sector coalition, led by the American Sustainable Business Council, has issued policy recommendations to guide recovery. They can be boiled down to four themes:

1. Stop investing in polluting and resource depleting technologies and fully embrace renewable ones;

2. Focus job creation efforts on solving entrenched problems and inequities, and building resource capacity (like water infrastructure, soil health, broadband);

3. Target recovery money and non-monetary supports to small and locally owned businesses, especially food businesses connected with solving food insecurity exacerbated by COVID;

4. Incentivize and reward businesses for retooling in a more sustainable direction.

Oates reinforces this last point. "I think we will also see more resource-efficient and zero-waste businesses," he says. "Developers are understanding that need. Now might be the time to follow through on ideas we've had for years but have not acted on. One thing COVID has exposed is our shortsightedness, which has cost us dearly."

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