Rural economic development: From the vineyards to the cloud to the water. Achieving the goal of shared prosperity.

We’ve written often about the challenges facing rural communities. For recent examples, see here, here, and here. In our state – and across the nation – economic growth has become increasingly concentrated in metropolitan areas, leaving small towns and rural counties struggling to fund public services and provide employment opportunities for their residents. 

So we were struck by a couple of stories in our news feeds this week. It’s a bit of an odd pairing, an appropriate term given the implications of one item for wine country.

The Daily Yonder reports on “Help Wanted in the Vineyards.” It’s largely a story of immigration policy, with a particular focus for the ag economy. We’ve previously noted the effects of changing demographics and immigration patterns. Diana R. Gordon writes,

Even before the election of President Trump, vintners in many grape-growing areas were worried about a shortage of workers as net migration from Mexico slowed and stopped (in 2007, according to the Pew Research Center). Winemakers at the 2016 Napa Valley Grapegrowers’ harvest press conference noted that labor was “a hot topic right now.” Last year a California industry market report found that “[i]n every growing area, the labor force is inadequate.”

Fast forward to 2017 and the attrition of skilled workers in the American wine industry seems likely to bring about major changes in production, affecting both the quantity and the quality of what we drink. At the very least, the labor shortage leaves the industry in a state of great uncertainty.

Automation, Gordon writes, may play a role in mitigating the labor shortage.

But winemakers often resist mechanized pruning and harvesting for the premium wines that are increasingly in demand. Besides, robots won’t support with consumption or human capital the economies of the agricultural communities that rely on the American wine industry.

Through production and distribution, California wines contribute almost $60 billion annually to the state economy; the wines of Washington and the wines and grape juice of New York add about $5 billion each to their states. Then there are the economic benefits of sales and consumption outside the wine-producing states, even outside the country. So a dip in production caused by a reduction in the labor force would have repercussions well beyond the collapse of some small wineries.

There’s a policy solution, albeit not one easily achieved.

In a recent letter to political leaders from the president on down, 1,470 economists of varying political persuasions hailed immigration as “one of America’s significant competitive advantages in the global economy” and called for “a visa system that recognizes market shortages.” While the writers emphasized the benefits of immigration for entrepreneurial and STEM jobs, they also endorsed the retention of “skill sets that keep our workforce flexible, help companies grow, and increase the productivity of American workers.” As every winemaker knows, experienced vineyard workers, whether legally in the country or not, have those skill sets and apply them for the enjoyment of the wine-drinkers of America.

For more on the effects of immigration policy, see this March 17, 2017 Seattle Times article. One takeaway:

In Washington state, the number of foreign agricultural workers … has more than quadrupled in the past half-decade to more than 13,000 annually as growers seek to ease a labor crunch that has left some unable to get their fruit harvested on time.

Rural economies also depend on technology. And Microsoft has recently unveiled a strategy for expanding broadband to underserved rural communities. Earlier this month, Microsoft president Brad Smith presented the company’s thoughts on the broadband gap

Broadband connectivity is no longer simply a luxury for streaming YouTube videos on a tablet (as enjoyable as that may be). It has become a critical connection to a better education and living. New cloud services are making broadband a necessity to start and grow a small business and take advantage of advances in agriculture, telemedicine and education. In short, broadband has become a vital part of 21st century infrastructure.

Yet today 34 million Americans still lack broadband internet access, which is defined by the Federal Communications Commission (FCC) as a 25 Mbps connection. Of these, 23.4 million live in rural parts of our country. People who live in these rural communities increasingly are unable to take advantage of the economic and educational opportunities enjoyed by their urban neighbors.

The proposed solution begins with proven technology, Smith says.

Our call for a new strategy reflects in part our own experience as a company working around the world to make use of what’s called TV White Spaces spectrum. This is unused spectrum in the UHF television bands. This powerful bandwidth is in the 600 MHz frequency range and enables wireless signals to travel over hills and through buildings and trees. It’s why people could watch television programs in rural communities long before the advent of satellite television. Microsoft itself has considerable experience with this spectrum, having deployed 20 TV white spaces projects in 17 countries that have served 185,000 users.

In 2010 the FCC adopted rules enabling the use of TV white spaces in the United States. It has taken years of additional work to put in place the building blocks needed for the use of this spectrum to scale in an affordable way. We and others have worked to perfect the hardware and software technology, develop industry-wide standards and innovate our way to a practical business model. These advances have now reached a critical threshold, however, and together with increasing demand for cloud services, the market is poised to accelerate – if we take the right steps.

Read the whole speech; it’s not long. He outlines both a private sector strategy, including a significant commitment by Microsoft, and public policy steps that must be taken to support the initiative. The conclusion is powerful:

In urban America, we’ve thankfully become accustomed to ongoing capital investments to expand broadband capacity in areas that already have broadband coverage. But the time has come to extend this coverage to the rural areas that lack it entirely. We believe a new rural broadband strategy makes this feasible, and with Microsoft’s Rural Airband Initiative we’ll put our own resources and energy behind this effort. We can all innovate together, achieving what none of us can accomplish alone. And just as we look forward to sharing what we have learned, we look forward to applying over the next five years what we undoubtedly will learn from others.

As a country, we should not settle for an outcome that leaves behind more than 23 million of our rural neighbors. To the contrary, we can and should bring the benefits of broadband coverage to every corner of the nation.

Finally, we want to again emphasize one policy – a Hirst fix – that must be addressed in the next 24 hours. The Seattle Times editorial board writes today,

WASHINGTON state lawmakers are exhausted after their marathon session and battle royale over education funding.

But important work remains. To get across the finish line they need a last-minute burst of collaboration to address uncertainty the state Supreme Court’s Hirst ruling has created for counties across the state.

In Hirst, the court ruled in October that counties must evaluate whether there is adequate water available before permitting new buildings, instead of relying on the state Department of Ecology to make such decisions…

Rural residents also have legitimate concerns about their property abruptly losing value and their lifestyle being lost because of new interpretations of longstanding growth policy.

A Hirst fix should respect such concerns while acknowledging that it won’t fix the long-term, underlying problem — that change and disruption are inevitable because resources such as water are finite.

Finding the right balance between rural growth and resource preservation will be an increasingly thorny challenge.

Many of the challenges facing rural communities are “thorny.” But it is increasingly important that policymakers and businesses at all levels recognize the importance of rural economies. As Smith writes, we cannot settle for outcomes that “leave behind our rural neighbors.” The Opportunity Washington program rests on the goal of shared prosperity, extending the culture of opportunity to all corners of our state.  Achieving that goal – from water rights, vineyards and the cloud – is within our reach.