DURHAM – Did North Carolina pay too much to land a $1 billion campus in the Triangle and 3,000 high-paying jobs? Thom Ruhe, CEO of the NC IDEA Foundation which focuses on development of the state’s startup and entrepreneurial community, likes the deal but prefers other ways to create jobs.

In a Q&A with WRAL TechWire’s Jason Parker, Ruhe spells out what he sees as the good – and what could be better.

  • What does this Apple news mean for the Triangle beyond the jobs and investment?

Like the announcement from Google last month, this is yet another large external validation of the technology and talent potential in the Triangle. When companies like Apple and Google put down roots here, you know they are seeing the region as an important one.

  • How would you describe NC’s decision regarding the use of funds/incentives—what’s the “opportunity cost” of this decision compared to others the state could make across the next four decades? 

Let’s be clear, this is another big win for the region and NC more broadly. In the broad context however, it is yet another coordinated effort to attract jobs. My hope for policy makers is that someday they will understand the employment impact of new firms that create jobs. Last

year NC saw over 7,000 more new firms, over the year prior. New firms in NC create an average of 5 jobs in their first year. That is a potential of 35,000 net new jobs. What would we, or any other state for that matter, be willing to offer in the way of incentives for 35,000 jobs?

  • How will we know whether it is worth nearly $1 billion in economic incentives?

Measuring impact and return from such incentive packages is a mix of easily calculated things and subjective projections. For example, you can project income tax: 3000 jobs with an average salary of $187K will, at a 5.25% income tax rate, generate nearly $30M/year in income tax. On that number alone, it would require 30+ years to break even. But there are so many additional tax and related economic impact factors that cascade from that large of an employment pool, at that income level, that the return is likely better/shorter than 30 years. I will leave it to the experts in calculating the net score on such matters.

  • What’s the impact on NC’s entrepreneurial economy? 

For the entrepreneurial ecosystem, this is good news. Yes, it will add stress to an already tight labor pool, but big efforts like these also help recruit high-demand employees from around the world to the region. Another benefit is for advancing entrepreneurship in general. Over the years to come, employees at Apple and Google will become inspired by some bleeding edge technology they are working on and will invariably attempt to start new companies. And those who do, will be rewarded with an exceptional entrepreneurial ecosystem that can help them take those ideas and turn them into more great companies.

  • Is this a transformative project? How might it impact talent markets and recruiting for smaller firms? 

Recruiting is a team effort with competing entities working together to tell a regional story, and our story is only getting stronger. As a more mobile workforce looks around to other parts of the country, they will see large well regarded companies establishing significant operations here. That will give them more confidence to seriously look here for opportunity; to include smaller firms. Their rationale may best be stated as: “if it doesn’t work out, I can always get a job at Apple or Google.”

  • Will it help with economic recruiting?

It will only help with economic recruiting. You may recall the recent buzz about Miami… “Come for the fun and the sun!” We can be assured by this possible buzz about the state: “Come to North Carolina, where the country’s best and brightest work on world-changing technology.”

  • Any other concerns?

I hope Apple (and Google) and those involved in their recruiting are keeping diversity, equity and inclusion top of mind. I’ve heard the region’s diversity was a factor in deciding to invest here. Let’s hope that the appreciation of the region’s diversity translates into hiring practices and local investments and support for communities.