Innovatia

decline before emerging with growth in high- skilled jobs and GDP. There was a strong cor- relation between variables that indicated the presence of a high proportion of young wealth creators aged between 25 and 34 and the city’s economic growth rate. Australia 2030 prosperity through innovation The reliance on traditional industry sectors, in Australia, will no longer maintain nation- al economic growth, productivity and living standards. The 2017 landmark report, Austral-

ia 2030: Prosperity through Innovation, articu- lated a clear vision that, by 2030, “Australia will be counted within the top tier of innovation na- tions and take pride in our global reputation for excellence in science, research and commer- cialisation.” Strategic opportunities identified in the report included increasing institutional support for commercialisation by establishing a dedicated stream of funding for translational activities. “A high proportion of young wealth creators is a strong indicator of a city with long-term innovation potential.” While Australia traditionally focuses on the role of its “mega” and large cities as drivers of economic growth, Australia’s smaller cities and regions such as Geelong in Victoria and Wol- longong and Newcastle in NSW have actively responded to the loss of traditional industry sectors. The City of Newcastle Newcastle, like all of colonial Australia, was born modern. The landmark innovations of the Industrial Revolution, Watt’s steam engine and Hargreaves’ spinning jenny, were both patent- ed in the decade prior to the departure of the First Fleet in 1787. The city of Newcastle was formally established in 1804 and was founded on a strong base of coal, steel and manufactur- ing, while its port shaped its international iden- tity as a trade hub in resources. In 1989, the city

FROM RUST BELTS TO BRAIN BELTS Taking Newcastle as a case study, Professor Caroline McMillen explores the economic transformation of small cities and their regions through innovation, and argues that this approach will be crucial in the decades to come. Professor (Hon) I. Caroline McMillen AO FAHMS D uring the past two decades, advanced economies have made the transition from a historical reliance on traditional

manufacturing or resources to advanced man- ufacturing industries based on integration of cyber and physical systems cast as emerging, frontier or Industry 4.0 technologies. In their 2017 book, The Smartest Places on Earth: Why Rustbelts Are the Emerging Hotspots of Glob- al Innovation, Antoine van Agtmael and Fred Bakker review 37 case studies of cities across Europe and the US that made successful tran- sitions to an innovation-based economy. During this period there was also a global fo- cus on factors underpinning the economic re- covery of cities that had experienced econom- ic and social decline before emerging as what were characterised as “magnet” cities. In 2014, KPMG analysed the five-year net growth in population and GDP in over 160 non-capital or second cities across the world categorised by the size of their population as large (>1.75m), medium (850k–1.75m) or small (<850k). Case studies were also carried out on nine cities that had gone through a period of economic

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