Seeking to develop a national strategy for economic development, a California congressman visited the Lehigh Valley to hear about its economic transformation.
“I think somehow we've got to figure out that's the magic sauce and see how do we have this kind of economic strategy in other places in America,” U.S. Rep. Ro Khanna, who represents Silicon Valley, said after a roundtable discussion held June 28 at the offices of Lehigh Valley Economic Development Corp. (LVEDC) in Bethlehem.
“How do we move directionally in what you've been able to achieve?” he said. 
Participating in the 90-minute discussion were U.S. Rep. Susan Wild and leaders from business, education, labor, municipal government, regional organizations, and workforce development. They explained what has made the Lehigh Valley economy prosper, and suggested what help they need from the federal government to grow jobs in manufacturing and technology.
“I just am so proud of this area, and just how advanced we are, and how we are just really lighting the world on fire, if you ask me, when it comes to manufacturing and tech and that kind of thing,” Wild said.
Khanna described the Lehigh Valley as having a unique and “inspirational” story to tell, having developed a diverse advanced manufacturing sector making food and beverages, technology, medical equipment, and consumer goods.
More than 750 manufacturers generate a collective $8.4 billion in output annually. That makes up 18% of the region’s Gross Domestic Product. Nationally, manufacturing is 12% of the U.S. GDP. The Lehigh Valley ranked second in the nation in 2022 for new economic development projects among mid-sized regions.
Khanna said he was impressed with the community’s vibrancy.
“You could tell that as you pull in here, Bethlehem looks like a bustling street with restaurants and you know, you can feel the prosperity within like a minute of coming into a town compared to other places,” said Khanna, who was born in Philadelphia, raised in Bucks County, and has written books about the importance of manufacturing to the U.S. economy and the need to create more technology jobs.
Panelists on the roundtable stressed that there’s a correlation between a region’s quality of life and its economic prosperity. Building a workforce requires building a community with a sense of place, where people want to live and raise families.
Wild said the region has changed greatly since she moved here in the 1980s. It has excellent health care and myriad options for entertainment.
The Lehigh Valley approaches economic development as a collaborative process that involves participants from the public and private sectors including elected officials, corporations, business incubators, colleges and universities, K-12 educators, and others, said Don Cunningham, President and CEO of LVEDC.
He said the region benefits because its location - 90 minutes from New York City and 60 minutes from Philadelphia – puts it within a day’s drive of one-third of the U.S. population. It has a growing population, and strong career and technical education system and higher educational system that combined graduate more than 11,000 students a year.
“The Lehigh Valley punches way above its weight class,” Cunningham said.
The panel told Khanna there are hurdles to address.
“Probably our biggest challenges today are the ramifications of success 20, 25 years ago,” Cunningham said.
With population growth and increased business and development comes additional traffic and greater demand for housing, which drives up prices, he said.
“We have companies that would be interested in coming here, who may be concerned about the lack of housing,” Wild said.
Officials from Tyber Medical and B. Braun Medical asked Khanna and Wild to pass legislation to rescind a change in the tax code that took effect in 2022. The cost of development now must be deducted over five years, instead of being deductible in total immediately.
“So, we spend the money all in one year to develop new products, grow and gain, and now it is not deductible, and it's only deductible one-fifth a year. Well, that's creating massive tax bills for us,” said Damien Sibilla, Chief Financial Officer at Tyber Medical in Bethlehem.
Cunningham said economic development strategies must evolve, with help from policymakers, to focus on ensuring that regions have an adequate and skilled workforce.
“You need the people and the talent,” he said.
He said some states, cities, and regions have gotten creative and developed financial incentives for people who relocate for employment: “You've got to move the people and not just the companies.”
He said immigration policy is critical when it comes to building a labor pool.
“Every economic boom in American history has been fueled by immigration,” Cunningham said. “It seems to me, the only thing we talk about in the U.S. is the southern border and illegal immigration. We don't talk about a broader immigration policy.”
Participants in the roundtable were: Khanna; Wild; Cunningham; Damien Sibilla, Chief Financial Officer at Tyber Medical; Matt Tuerk, Mayor of Allentown; Sunny Ghai, Upper Macungie Township Supervisor and business leader; Dan McCarthy, Lehigh Valley Partnership Secretary and LVEDC Board Member; Michael Cacace, Vice President of Corporate Tax at B. Braun Medical; Angelo Valletta, President and CEO of Ben Franklin Technology Partners of Northeastern Pennsylvania; Paul Anthony, Business Manager and Financial Secretary of IBEW Local Union #375 and LVEDC Board Member; Andy Hammer, Executive Director of the SkillsUSA Council for the Lehigh Valley; and Karianne Gelinas, Vice President of Regional Partnerships & Talent Strategies at LVEDC.
Khanna’s visit to the Lehigh Valley was part of a three-day tour of communities in Pennsylvania and Ohio.