The leaders of Johns Hopkins University and Health System and BGE showed desperately needed leadership last year when they recruited two dozen other big Baltimore businesses for an effort to boost the city’s economy by setting goals for increased spending with local, small, minority-owned firms. As we noted at the time, an increase of $69 million in spending with local construction firms and suppliers wouldn’t solve all the city’s problems, but it was a start. With no cohesive response to the social ills exposed by the 2015 riots coming from City Hall, somebody had to step up, and it was a testament to the cohesiveness and resilience of the city that such a private effort emerged.
This week, the BLocal partners issued a first-year progress report that shows striking success — the partners substantially exceeded their three-year goals after just one year. Its failing, if you can call it that, is that the effort isn’t ambitious enough.
The partners documented increased construction contracting commitments with local and/or minority owned, women owned or otherwise disadvantaged businesses by $73.8 million. But most of that last figure comes from Johns Hopkins ($55 million) and three other firms (Brown Advisory, 1st Mariner Bank and The Cordish Cos.) made up the rest. Another partner firm, Whiting Turner, performed as a contractor on many of those jobs. That means the other companies that participate in the initiative have some catching up to do.
Construction contracting is just one part of the initiative, and obviously some firms do much more of it than others.The 25 companies set individual goals in a variety of other areas — including procurement, hiring and philanthropy — and the report shows progress on 90 percent of them. That fact should serve as a powerful recruitment tool. We have no doubt that more than 25 companies or non-profits have an interest in buying and hiring local, and this report shows that it can be done. Three more companies joined the initiative during its first year, and organizers should set goals for recruiting more and/or coordinating with entities like the University of Maryland-Baltimore, which has committed itself to similar efforts, to develop standardized ways to gauge performance and share best practices.
Phase two of the BLocal movement should focus on fostering sustainable, organic economic growth in the city. Some of the initiative’s efforts are geared in that direction, like BUILD College, which helps the owners of small contracting firms learn better business practices, and an initiative to connect local companies with support services and capital through a Goldman Sachs entrepreneurship program. BLocal should focus on helping firms that have gotten a leg up as a result of the effort to be equally successful in expanding their business with companies that aren’t part of the initiative through long-term mentorship and other resources.
The same goes for BLocal’s hiring goals. The report says that several participating firms set a goal to increase hiring of city residents, and that resulted in 470 job placements in the first year. All of the BLocal companies need to make enhanced local hiring a part of their commitment, and in particular, they should follow Hopkins’ lead in finding opportunities for ex-offenders. Some of the firms offered mentorships or job training programs, and those need to become more widespread as well. Finally, all participating firms need to create opportunities for those who get a foot in the door through local hiring programs to develop their skills and advance in sustainable careers. Hopkins and UMB both have done work in that area and have lessons to share. Moreover, the BLocal companies should develop formal networking arrangements so that a worker whose career path might not be the right fit for one firm could find a more opportune placement at another.
BLocal is not entirely unique; similar initiatives have been successful in other cities. But it is unusual in that it developed out of the commitment of local business leaders, not an initiative from City Hall. Ultimately, that could be a great strength if it fosters a longevity that the pet project of one mayor or another tends to lack. And make no mistake, this needs to be a long-term effort. As impressive as BLocal’s first year is, it is only scratching the surface of what needs to be done.
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