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Economic Development 101

April 17, 2015

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"San Diego's labor market has really hit its stride. The unemployment rate is at a seven year low and two full percentage points lower than a year ago. More than 30,000 people who were unemployed have found employment in the past year, and the labor force continues to grow. Job growth has been led by key middle-to-high-wage industries like construction, health care, education, manufacturing and scientific services. These are great signs as we move ahead in 2015."
Phil Blair, President and CEO
Manpower San Diego


[Highlights]

This post is part of an ongoing monthly series dedicated to the California Employment Development Department (EDD) monthly employment release and is brought to you by Manpower. Click images to enlarge in a new tab/window.

The California Employment Development Department (EDD) released statewide county employment data today for the March 2015 period. This month’s data shows that unemployment was down again in March as the economy continued to grow at an increasingly solid pace.

The unemployment rate is likely the big story again this month since at 5.1 percent, it is the lowest it has been in nearly seven years (April 2008). This is 2.0 points lower than the previous year and 0.2 points lower than the previous month. San Diego’s unemployment rate remained below the U.S. average of 5.6 percent and well-below the California average of 6.5 percent. The region also experienced labor force growth. More than 3,000 people were added to the region's labor force from March 2014 to March 2015, indicating that the continued drop in unemployment is likely due to a healthy economy rather than a dwindling labor force.

[Unemployment Chart]

When looking at monthly or seasonal employment, San Diego County employers added 8,000 jobs from February to March. Construction accounted for a quarter of this monthly growth, adding 1,500 jobs from February to March. Tourism , health care and private education industries also experienced high seasonal growth, while retail and wholesale trade experienced slight seasonal declines.

From a year-to-year or non-seasonal perspective, the region’s economy is showing signs of picking up the pace. Total non-farm employment grew by 40,900 jobs from March 2014 to March 2015­—a 3.1 percent growth rate. This exceeds the U.S. growth rate of 2.3 percent. In all three months to date in 2015, the region recorded annual job growth of more than three percent, compared to 2014 when not a single month exceeded three percent annual growth.

[Employment Chart]

The private sector economy accounted for 92 percent of the year-to-year job growth and grew by 3.4 percent. This rate also outpaced the U.S. growth rate, which was 2.7 percent over that same period. This job growth continued to be fueled by key sectors. Construction jobs grew by 7.4 percent and added 4,600 jobs. One of the region’s key manufacturing sectors ship and boat building grew by 18.7 percent and added 1,100 jobs. 

Innovation service sectors also continued to show high job growth. The professional, scientific and technical services (PST) sector grew by 7.2 percent year-to-year, and accounted for approximately a quarter of the job growth. This sector represents many of our innovation employers. More specifically, scientific research and development services, a subsector of PST that represents many cleantech and life science companies, grew by 8.4 percent since last March.

[PST Chart]

The region’s tourism continued to show high year-to-year growth as well. The leisure and hospitality industry added 7,300 jobs over that period, which is about 4.3 percent growth. Food service and drinking places accounted for 7,000 of those jobs. Private and public education services experienced high seasonal and non-seasonal growth. Education services added 1,400 year-to-year jobs (4.5 percent growth) while state and local government education added 2,500 year-to-year jobs (3.0 percent growth).

The March labor market report was all around positive. Low unemployment, high job growth and a growing labor force are all excellent signs of burgeoning regional economy. More importantly, this growth continues to be driven by key sectors to the region's economy. Continued rapid growth in construction indicates that regional builders are constructing important infrastructure to address a growing economy. Furthermore, the region's key high-wage and innovative sectors are driving private sector growth. The region is far outpacing the state and nation in these important metrics, all good signs for the year ahead.

[Growth Chart]





Note: Our Economic Indicators Dashboard will show how our unemployment rate compares to other US metros and the US total rate when that information is released in the coming weeks.

April 8, 2015
Every quarter, San Diego Regional EDC analyzes key economic metrics that are important to understanding the regional economy and San Diego’s standing relative to other major metropolitan areas in the U.S. This issue covers data from the October 2014 to January 2015 quarter.
 
In this issue, EDC presents updates on trends in employment, real estate and venture capital, with a special spotlight on wage growth. The spotlight investigates whether job growth occurred in high-wage industries.
 
Download the full snapshot to view all of the tables, graphs and trends for this quarter. 
 

 

The snapshot is made possible by 

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March 26, 2015

 

Canada: one of San Diego’s largest export markets and one of San Diego’s top 10 sources of foreign investment.

Canada: one of four international destinations of which our international airport has direct flights.

When your region has a full-time consul corps representing their country, you know your region must have strong trade connections. This is apparent even more so when you look at one of the consulates which have a full-time presence here: Canada.

The Canadian Consulate in San Diego, spearheaded by Lisa Stockley, represents one of San Diego’s largest trading and investment partners. Having a strong partnership with the consulate ensures that businesses in the region have access to critical support for their endeavors of expanasion into Canada. Additionally, it provides San Diego the visibility so Canadian businesses can learn about the regional economy and expand here.

Canada is the 6th largest source of foreign employment in San Diego. From wireless communications with Blackberry, to computer equipment manufacturing with Sierra Wireless, and gaming accessories manufacturing with Mad Catz, Canadian businesses encompass many aspects of San Diego’s economy. The diversity of Canadian companies doesn’t just span industries, it also encompasses companies at all stages; Not only do larger companies locate to San Diego, but startups in Canada have begun to realize the potential for growth. Koriist, a software developer for military communications, is currently housed in the downtown startup incubator EvoNexus.

Not only do smart companies from Canada want to trade with San Diego, but so do the people. According to a report published by Beacon Economics, more than 13,500 of the residents in San Diego County were born in Canada, making them the 7th highest immigrant population in the region. These residents are highly-skilled workers, with more than 42 percent of these them holding a Bachelor’s degree, compared to about 35 percent of the region as a whole. Not only are these residents smart, but they work primarily in some of the region’s most innovative companies. The sectors with the highest concentration of workers for Canadian-born residents are healthcare and the professional, scientific, and technical industry – key sectors which represent the innovation economy.

Having a consulate or any foreign office in San Diego representing their diverse and important workforces and business communities strengthens our economic bonds with our foreign partners. Luckily, the Go Global San Diego initiative aims to establish two additional foreign offices in San Diego as part of its main goal to maximize the region’s economic competitiveness and prosperity through increased global engagement.

To gain more information about Go Global San Diego go to www.goglobalsd.org and learn about the trade and investment initiative, MetroConnect, and many other important tools to help businesses go global. 

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March 25, 2015

With California Aerospace week underway in Sacramento, we wanted to take a look at how San Diego contributes to this thriving cluster. The industry counts itself among the  “aerospace, navigation and maritime technologies cluster,” which directly employs 35,000 in the region at an average annual wage of nearly $84,000. In an effort to bolster job creation in the industry, LAEDC and San Diego Regional EDC were in Sacramento earlier this week to meet the new chairs of the Assembly and Senate select committees on aerospace.

Aerospace has a long history in San Diego, dating back to the early 1900s when Ryan Airlines built the Spirit of St. Louis and Reuben Fleet brought Consolidated Aircraft Corporation to Lindbergh Field. Since then, San Diego’s aerospace cluster has been an integral part of the region’s innovation and defense economies.

Here are a few things you may not have known about the region’s thriving aerospace industry:

  1. They're not all "manned."
    Illustrating some of the dynamic uses for unmanned system.
    Illustrating some of the dynamic uses of unmanned systems. Clockwise from top left: Drone used for newspaper delivery (The Atlantic), prepping a wildfire- fighting drone for launch (The New York Times), simulation of a lifeguard/lifesaving drone (AUVSI), agricultural drone used for pest control.( Diydrones.com)
    Pilot-less aircraft, or unmanned air systems/drones, are revolutionizing the world. From the drone hobbyist to military contractors, San Diego’s diverse terrain, military expertise, and talented workforce have put us at the epicenter of drone manufacturing.

    Like many great innovations (e.g.  the internet), drone technology originated in the military, but has broad applications. From fighting wildfires to crop dusting and delivering crucial medications to people in disaster-inflicted areas, drones are another example of how San Diego works to solve some of the world’s hardest problems.

    A 2013 study by AUVSI found UAS integration in California would create 18,161 jobs throughout the state within a decade of airspace incorporation.

  2. The largest aerospace manufacturer in the state has a presence here.
    Nat Geo host Andrew Evans explores Northrop Grumman's Global Hawk during filming of the documentary
    Nat Geo documentary host Andrew Evans explores Northrop Grumman's Global Hawk during filming of the documentary.
    Defense Innovator Northrop Grumman – the Golden State’s largest defense company -  has 3,087 employees in San Diego, according to the SDBJ. Recognizing the region’s strengths in UAS technology, the company consolidated its Unmanned Center of Excellence to its Rancho Bernardo location in 2013.

    Northrop Grumman is featured in the upcoming Nat Geo “Smart Cities” documentary about San Diego (stay tuned for air dates).
     
  3. Baja California contributes to the region’s aerospace dominance.
    Calibaja Manufacturing
    A manufacturing facility in Baja California.
    As Mayor Faulconer likes to say regarding the San Diego – Tijuana relationship, “We’re two cities, but we’re one Mega-region.” This is particularly true when you look at the aerospace sector. Despite a recent decline, Baja California’s stronghold in aerospace manufacturing still reigns supreme, boasting more jobs in that sector than any other Mexican state.
     
  4. We’re getting ready to release the largest economic impact study about the aerospace industry the region has ever seen.
    Members from San Diego Regional EDC and LAEDC gather with legislaters in Sacremento to show support for the state's aerospace industry
    San Diego Regional EDC and LAEDC gather with legislators in Sacramento to show support for the state's aerospace industry.
    San Diego Regional EDC is working collaboratively with LAEDC to launch an aerospace economic impact study that will quantify the nine counties that make up Southern California. The study will help articulate how Southern California’s aerospace industry competes on a global level.
     

March 20, 2015

Strong Workforce TownhallA businessman, an educator and a politician walk into a room.

There’s no punchline here. In many other regions – that don’t count collaboration as a strength – this may be the beginning of a counterproductive encounter. In San Diego, this is how we find solutions. At the Strong Workforce Town Hall held at Illumina on Wednesday, business people, educators, economic and workforce development professionals, and politicians gathered to address how the region will close the impending skills gap.

California Community Colleges play a vital role in preparing workers for jobs and strengthening the economy. Wednesday’s conversation was part of a series of ‘town hall’ style meetings held throughout the state to help California’s dynamic community college system close the skills gap.

The facts are alarming: by 2020, there will be 6.3 million job openings in the state of California. If we want to remain a center for innovation, we must have the workforce to get us there.

So how do you prepare the 2.1 million students in California for tomorrow’s workforce?

Strong Workforce Townhall

 

Sunny Cooke, president of Mira Costa College and chair of the State’s Strong Workforce Task Force, said we must rethink the three fundamental ‘R’s:

  1. Relationships: Perhaps the most crucial component, the community colleges must develop stronger relationships with employers.  Rick Urban, COO at Quality Control Manufacturing in Santee, said that his business depends on having, strong, skilled workers. With the help of East County EDC and coordination with community colleges, he was able to develop a pipeline to recruit and train technical talent.

    Up in Oceanside, Genentech seeks to work with the community colleges to find the medical device manufacturing and R&D talent it needs to succeed. "We need an agile and flexible workforce,” said Adria Harris, an HR representative at the company. The good news is lawmakers are already beginning to adapt. A pilot program will give community colleges throughout the state the opportunity to begin offering bachelor’s degrees in select programs next year. Based on workforce needs, Mira Costa College was recently approved to begin offering bachelor’s degrees in bio-manufacturing.
     
  1. Resources: Financial resources are always going to be an issue. As a state (and region), we must get creative with how we fund these crucial job training programs. It’s not only about identifying new resources, but also figuring out how to redirect resources that make sense for industries – such as maritime and biotech – that have a strong presence in the region.
     
  1. Re-thinking the Rules: As a state-run agency, bureaucracy will always be a part of the community college system. However, Cooke encouraged administrators and policy makers to think creatively about these regulations.

San Diego’s  – and California’s – leaders must work in earnest to find, develop, and enhance our workforce pipeline. As California Community Colleges Chancellor Brice Harris says, “our global competitiveness depends on it.”

All pictures are courtesy of the San Diego Workforce Partnership

March 20, 2015

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"The San Diego regional economy continues to hum along at a steady pace. The unemployment rate is the lowest it has been in nearly seven years while we continue to add good jobs in our innovation and building industries each year. There are plenty of reasons to remain optimistic about 2015."
Phil Blair, President and CEO
Manpower San Diego


[Highlights]

This post is part of an ongoing monthly series dedicated to the California Employment Development Department (EDD) monthly employment release and is brought to you by Manpower. Click images to enlarge in a new tab/window.

The California Employment Development Department (EDD) released statewide county employment data today for the February 2015 period. This month’s data shows that unemployment was down in February as the economy continued to grow at a steady pace.

The unemployment rate is likely the big story this month since at 5.3 percent, it is the lowest it has been in nearly seven years (April 2008). This is roughly 1.8 points lower than the previous year and 0.5 points lower than the previous month. San Diego’s unemployment rate remained below the U.S. average of 5.8 percent and well-below the California average of 7.1 percent.

[Unemployment Chart]

When looking at monthly or seasonal employment, San Diego County employers added 6,200 jobs from January to February. Much of this growth came from the government sector, mostly from state and local education. Tourism and private education industries also experienced seasonal growth, while retail trade and construction experienced slight seasonal declines.

From an year-to-year or non-seasonal perspective, the region’s economy continued its steady post-recession growth. Total non-farm employment grew by 39,700 jobs from February 2014 to February 2015­—a 3.0 percent growth rate. This exceeds the U.S. growth rate of 2.4 percent.

[Employment Chart]

The private sector economy accounted for 90 percent of the year-to-year job growth and grew by 3.3 percent. This rate also outpaced the U.S. growth rate, which was 2.8 percent over that same period.

Year-to-year job growth continued to be fueled by key sectors. Construction jobs grew by 5.2 percent and added 3,200 jobs, despite the small 400 job seasonal decline. Manufacturing growth has slowed since 2014, and recent EDD adjustments indicate that growth was lower than previously thought. However, one of the region’s key manufacturing sectors ship and boat building grew by more than 15 percent.

[PST Chart]

Innovation service sectors also continued to show high job growth. The professional, scientific and technical services (PST) sector grew by 6.4 percent year-to-year. This sector represents many of our innovation employers. More specifically, scientific research and development services, a subsector of PST that represents many cleantech and life science companies, grew by 7.7 percent since last February. Professional and business services overall accounted for one quarter of all year-to-year private job growth.

The region’s tourism sector was one of the few seasonal growth industries and also experienced high year-to-year growth. The leisure and hospitality industry added 8,200 jobs over that period, which is about 4.9 percent growth. Food service and drinking places accounted for most of the growth. Private and public education services experienced high seasonal and non-seasonal growth. Colleges, universities and professional schools added 1,300 year-to-year jobs (9.3 percent growth) while state and local government education added 3,200 year-to-year jobs (3.0 percent growth).

[Growth Chart]

EDD released adjustments to 2014 data earlier this month. Those adjustments indicate that 2014 growth wasn’t quite as high as expected, with annual job growth from ranging from 2.2 to 2.4 percent throughout 2014. Therefore, while some of the growth figures for February 2015 in this report appear lower than the growth rates shown in previous monthly reports, the region's economy is actually growing faster than it was throughout 2014. Unemployment is the lowest it has been in nearly seven years and employment growth has consistently outpaced the national average. This is a positive sign as the region continues to steadily grow post-recession.

Note: Our Economic Indicators Dashboard will show how our unemployment rate compares to other US metros and the US total rate when that information is released in the coming weeks.

March 13, 2015

MetroConnect Header

Go Global San Diego has laid out the facts. If San Diego wants to compete in a global marketplace, it must encourage companies to increase their global engagement. JPMorgan Chase & Co. has stepped up to the plate to catalyze small and medium sized enterprises to take their businesses to the rest of the world.

At the Go Global San Diego Summit on Wednesday, San Diego Regional EDC and JPMorgan Chase announced the MetroConnect Prize. MetroConnect will provide selected company with up to $10,000 in matching funds to cover up to 50 percent of the costs associated with the company’s next steps to going global.

Thanks to support from the JPMorgan Chase & Co., San Diego Regional EDC will award the MetroConnect Prize to at least 20 companies trying to take their innovative products abroad, secure strategic partnerships and boost international sales, that ultimately translates into increased economic activity in San Diego.

Deadline to apply is May 4. Head over to MetroconnectSD.org to learn more and apply.

March 10, 2015

 

"The numbers show that San Diego's economy is off to a great start in 2015. We're continuing to see the same accelerated year-over-year job growth that we saw at the end of 2014. Seasonal rise in unemployment might skew this result, but by nearly all measures, we're in a better place than we were last year."
Phil Blair, President and CEO
Manpower San Diego


[Highlights]

NOTE: Due to the delayed release of  data by EDD, this post will be updated with charts once the full data set is released.

This post is part of an ongoing monthly series dedicated to the California Employment Development Department (EDD) monthly employment release and is brought to you by Manpower. Click images to enlarge in a new tab/window.

The California Employment Development Department (EDD) released statewide county employment data today for the January 2015 period. The release reported that the San Diego County unemployment rate increased to 5.8 percent and jobs declined by 20,100 from December 2014. January jobs figures are generally prone to seasonal effects, as retail jobs descend back to normal after the holiday season.

San Diego County’s unemployment rate rose by 0.3 points to 5.8 percent from the revised December figure of 5.5 percent. However, the unemployment rate remained 1.4 points lower than it was a year prior. The unemployment rate in the region was 1.5 points below California’s 7.3 percent rate and 0.3 points below the U.S. average of 6.1 percent. The unemployment rate rose, but not as much as California or the U.S. average. As noted, the rise is seasonal, since year-over-year data shows the region is in a far better place than January of the previous year.

San Diego County lost 20,100 jobs from December to January, but added a total of 40,400 jobs since January 2014. This equals a job growth rate of 3.1 percent over the year, which eclipsed the U.S. total employment growth rate over the same period. Year-over-year data is a better indicator of economic growth since it controls for seasonal changes. Therefore, despite a seemingly alarming monthly decline, the region's economy is steadily growing.

Year-over-year job growth continued to be fueled by the private sector. San Diego County private businesses added 36,700 jobs since January 2014, a 3.4 percent growth rate. Private sector jobs accounted for 90.8 percent of year-over-year growth.

While most service-providing industries took a typical seasonal hit, goods-producing industries added 1,400 jobs from December to January. More importantly, goods-producers added 5,200 jobs from the prior year, a 3.3 percent growth rate. Construction added 2,200 job since the previous month and 4,200 jobs since the previous year, in large part due to the construction of new buildings. Meanwhile, manufacturing added 1,000 jobs since the previous year, 900 of which came from the region's critical ship and boat building sector.

Innovation sectors continued to show high job growth. The professional, scientific and technical services (PST) sector grew by 6.6 percent from January 2014 to January 2015, adding 8,300 jobs. This sector represents many of our innovation employers. More specifically, scientific research and development services, which represents many cleantech and life science companies, added 2,400 jobs since last January--7.8 percent job growth.

[Growth Chart]

Despite the potential headlines that will surround the rising unemployment rate and declining employment, the region is continuing to experience above average year-over-year growth. The region outperformed the state and nation in employment growth, and experienced a smaller seasonal unemployment decline. Employment continued to grow above three percent annually, a great sign as we move into the new year.

Note: Our Economic Indicators Dashboard along with a brief blog post will show how our unemployment rate compares to other US metros and the US total rate when that information is released in the coming weeks..

March 10, 2015

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Didn't get a ticket to the sold-out Go Global San Diego Summit on March 11? You can tune in live, thanks to the UT.

Learn...

  • What Mayor Kevin Faulconer is doing to increase the region's competitiveness in order to create jobs
  •  Why San Diego must adopt a global mindset, in a keynote presented by Bruce Katz, renowned urban thought leader from the Brookings Institution
  •  Where San Diego stacks up in our ability to attract investment from overseas and export company products
  •  What Qualcomm, Ajinomoto Althea, San Diego County Regional Airport Authority, UC San Diego, and the Port of San Diego are doing to promote global business opportunities
  • How one company is planning to help other San Diego companies reach foreign markets

Tune in LIVE this Wednesday, beginning at 11:45 am on U-T. No prior sign-up required. Just head over to utsandiego.com/goglobalsd at 11:45am on Wednesday, March 11 to learn more about what 30 + San Diego organizations are doing to increase the region's global competitiveness.

Presented by

UT-San-Diego-Logo-200

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March 4, 2015

Leading up to San Diego’s Global Summit on March 11, we’ll be giving a rundown of some panelists, guest speakers and programs involved in the Summit every Wednesday.

Ajinomoto_althea_imagequote

Foreign direct investment inflows to the United States are big business. In 2012 alone, the U.S. attracted more than $160 billion in foreign direct investment, making our nation the world’s top destination for foreign direct investment. In 2011, foreign-owned companies in the U.S. were responsible for employing 5.6 million U.S. workers.

In San Diego, foreign direct investment supports more than 48,000 jobs, which pay an average of 30 percent more than industry average. Even though foreign owned firms in San Diego account for 5 percent of the region’s employment, they account for nearly 19 percent of all corporate R&D spending, 12 percent of the productivity growth, and 20 percent of the total goods exported.

The story of Althea Technologies, now known as Ajinomoto Althea, began in 1998, when Magda Marquet and Francois Ferre established Althea Technologies in San Diego and began developing plasmid kits and other related life sciences products. After 15 years of development and growth, the company was acquired by global Japanese manufacturer Ajinomoto Co. for approximately $175 million, which not only was a boon to San Diego’s economy, but also served to strengthen its ties to Tokyo and Japan.

Foreign direct investment from Japan in San Diego is a crucial part of the discussion when talking about our global competitiveness. Tokyo invests more in San Diego more than any other city, accounting for 13 percent of all foreign direct investment in San Diego. These investments bring capital, jobs and opportunities to the region and are important in supporting San Diego’s advanced industries.

Aside from explicit economic gains, these foreign ties will prove to be indispensable strategic partnerships for San Diego in the coming decades. Projections say that by 2030, 66 percent of the global middle class will be in Asia. Partnerships made in Asia today will undoubtedly pay dividends tomorrow. At the dawn of “America’s Pacific Century,” San Diego has the potential to be a national leader in the face of a changing economy.

On March 11 at San Diego’s Global Summit, Ajinomoto Althea and key leaders will launch the Go Global Trade and Investment Initiative.

The summit is SOLD OUT. You can catch the event live, starting at 11:45 am, courtesy of U-T San Diego. 


Join us as we formally launch the Go Global San Diego global competitiveness initiative on March 11. Subscribe here to receive new posts every Wednesday on this topic.