"Mechatronics" sounds like something your child might covet for Christmas. But this emerging employment cluster actually could play a role in the region's economic future.

Meanwhile, when compared with national averages, rally-around-the-flag sectors such as computer and information technology are sucking wind in the region now branded as NewVA. Most technology-oriented businesses that are emerging "tend to be concentrating in Blacksburg."

The region's banking sector has grown faster than the national average, but much of its related employment is in "back office" customer-service jobs vulnerable to outsourcing and off-shoring.

And the health care industry - the region's much ballyhooed sector and employer of about 11 percent of its work force - "is about as large as one might expect to find" in a region this size.

Points that beg a few questions.

What's "mechatronics?" What's NewVA? Is a "cluster" a treat you regret buying at a roadside candy factory in South Carolina or is it something else? And, finally, what's the source of these conclusions and why should anyone care?

Beginning with the last question first, the Fifth Planning District Regional Alliance released results last week of an "industry cluster analysis" conducted to identify which groupings of companies are most important to the region's future. The alliance hopes the analysis will help guide economic development groups, government officials and other policymakers as they wrestle with a regional economy in transition from a railroad and manufacturing hub.

And the region analyzed was NewVA - a "brand" coined earlier this year to raise the profile and boost a sense of regional identity for the part of Virginia that includes the Roanoke and New River valleys, the Alleghany Highlands and Franklin County.

The study cost about $35,000, with the bulk of that paid by the Fifth Planning District Regional Alliance. The cluster analysis was prepared by the Center for Regional Economic Competitiveness and the Roanoke Valley-Alleghany Regional Commission.

As for clusters, according to Harvard Business School's Institute for Strategy and Competitiveness, they "are geographic concentrations of interconnected companies, specialized suppliers, service providers and associated institutions in a particular field that are present in a nation or region."

Think Silicon Valley. Think Hollywood. One recent example of interconnected companies in the region is the relationship between NewVA newcomers Integrity Windows and Doors and a major supplier, Cardinal Glass.

Universities and work-force training centers play important roles in most successful clusters, providing access to ideas, spinoff companies that emerge from university research and savvy employees.

The analysis of regional clusters relied on jobs data from the Virginia Employment Commission, Standard Industrial Classification codes, input from a panel of clusters experts, software-guided economic modeling and interviews with NewVA businesspeople.

Clusters were deemed important to the region according to the number of people they employ, their relative concentration in the regional economy, and their wages. Researchers calculated a "location quotient" that compares the proportion of regional employment in a cluster with a similar measure of the national economy's employment in that cluster. High location quotients can suggest a competitive advantage.

"Ideally, you'd like to target the companies in clusters that have high location quotients and are growing," said Victor Iannello, president of Synchrony, vice president of the Roanoke Valley Economic Development Partnership and chairman of the Fifth Planning District Regional Alliance.

The study identified eight basic or emerging industry groups important to the region's economic base.

Which brings us back to mechatronics - which is one of the eight.

First coined in the late 1960s by a Japanese engineer, the term refers to a branch of engineering whose focus is combined mechanical, electrical and software systems. Mechatronics can play a key role in applications that range from planetary rovers to autofocus cameras to triggers for air bags.

Iannello said regional companies that might fall in the mechatronics classification are GE Energy and Synchrony in the Roanoke Valley and Kollmorgen Corp. in the New River Valley.

According to the clusters analysis, although mechatronics employs only 2,777 of the region's work force of some 228,000 people, "it is so highly concentrated that it has the potential to become a major economic driver in the years to come." The study found mechatronics also seems to be coalescing in the Blacksburg metropolitan statistical area, noting, "No doubt this industry group is drawn to the resources of Virginia Tech's engineering research and teaching."

An opto-electronics cluster also got regional high marks for good wages and decent growth. Cluster members would include, among others, ITT Night Vision, Optical Cable Corp., the Spectacle Lens Group and Luna Innovations.

The remaining five "basic or emerging" industry groups identified were: motor vehicle related manufacturing; research, development and technical design; hospitals, labs and specialized medical services; pharmaceuticals; securities and insurance; and primary metals.

Other findings:

The higher education cluster suffered because of cutbacks in state spending.

Growth in health care and business services has been strong, but that growth tends to reflect national trends rather than a regional competitive advantage.

Many rural clusters are manufacturing related and face challenges from technological change and globalization.

The region's information technology and computer technology sectors continue to struggle to create a critical mass of firms and market presence.

The Roanoke Higher Education Center is an important resource for work-force development.

Gaps in local air service and high fares were identified as impediments to growth.

On the Net:

www.rvarc.org/alliance/cluster2004.pdf