JAY YOO ANSWERS MY QUESTION: Jay Yoo of KOYONO and I have had a little exchange about my last post in the comments section of his blog here. Here's his response to the question I raised (emphasis added):

I will cut to the chase and say that indeed we do have plans to hire people in our business plan. However, we will hire people around our strengths and strategic focus, which is Innovation/Design/Marketing. Hiring people for manufacturing is a complete distraction as there are so many quality contractors around the world. Focusing on a weakness only weakens your strengths.

We are very clear on what we want to be strong at and will be hiring around building strength. Hopefully Cleveland will become a destination for creative people. That would make it even more attractive for us to want to stay here...

This clear, forthright statement is the kind of thing we need more of in local discussions about economic development strategy. It cuts to the heart of a vital but neglected economic development issue: Is successful new enterprise development the same as local job creation?

The answer is, not necessarily... especially if we're trying to find jobs for unemployed or poor people. As KOYONO demonstrates, Northeast Ohio could create lots of profitable new firms (and new rich people) with very few new jobs -- if those firms send their work elsewhere, or hire only a few very high-value employees, or both. (Remember this from my other favorite straight-talking NEO entrepreneur, Scott Rickert of Nanofilm?)

That doesn't mean those entrepreneurs and companies aren't valuable, or that supporting them won't pay off for the community in other ways. But it does mean we need to separate the various ED value propositions -- new business starts, wealth creation, job creation, "fighting poverty" -- when we consider public ED investments. These goals are not all the same thing, and they can sometimes be in conflict. To invest "strategically", we need to be clear about what we're buying.

If we're buying just a few high-skilled creative or technical jobs, let's be clear about that. And if we're creating outsource work for "quality contractors around the world", let's ask how we can spur competitive bids for that work from entrepreneurial Cleveland employers who pay living wages. I bet Jay Yoo could give us some tips.