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Research Blog

July 20, 2018

Each month the California Employment Development Department (EDD) releases industry data for the prior month. This edition of San Diego’s Economic Pulse covers June 2018 data, including unemployment, new business establishments, and job postings.

Highlights include:

  • The region’s unemployment rose to 3.7 percent in June after several months of record lows.
  • Every jurisdiction saw an increase in the unemployment rate during the month of June. Six cities had increases of a full percentage point. 
  • Labor force grew, adding 5,200 workers during the month, up 0.3 percent. However the labor force is down 2,500 compared to a year ago.
  • Monthly employment trends changes appear to be countering trends of the past year. PST services continue to have the fastest year-over-year growth, up 4.9 percent.

Read the full Economic Pulse here.

 

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July 12, 2018

Amid contentious political rhetoric and tightening borders, global trade and investment are top of mind for national leaders and companies alike. To contextualize the importance of such international connectivity, World Trade Center San Diego, with support from the Center for U.S.-Mexican Studies at UC San Diego’s School of Global Policy & Strategy, released “Trade and Competitiveness in North America,” a research summary that quantifies trade and competitiveness in the Cali Baja mega-region, spurred in part by the negotiation of the North American Free Trade Agreement (NAFTA).

“An integrated North American economy creates opportunity on both sides of the border. For every 10 jobs an American multinational creates in Mexico, it creates 25 in the United States,” said Nikia Clarke, Ph.D., executive director, World Trade Center San Diego. “As we look at a global economy where 95 percent of the world consumers live outside of North America, the ways we partner with Canada and Mexico to produce goods, services, and technology is crucial to our economic future.”

With nearly $3.6 billion in trade occurring daily between the U.S., Canada, and Mexico, and 14 million jobs in the U.S. supported by this trade within North America, NAFTA is one of the most beneficial and significant trade agreements in history – most especially to the Cali Baja mega-region, which includes San Diego County, Imperial County, and the State of Baja California.

Against the backdrop of rapid changes in global production, a newfound ‘trade war’ with China, and renegotiations of trade agreements, Cali Baja’s global competitiveness is dependent on the $2.5 billion co-producing manufacturing supply chain that creates jobs and opportunities on both sides of the border.

KEY STUDY FINDINGS:

  • Cali Baja’s foreign exports total $24.3 billion, of which $6.2 billion stay within the mega-region.
  • Mexico is California’s largest export market, with annual exports totaling $26.8 billion. Today, trade with Mexico supports more than 566,000 jobs in California.
  • Since NAFTA was signed, California exports to Mexico have grown by 311 percent.
  • Cali Baja produces commodities including medical devices, semiconductors, aerospace parts, and audio and video equipment. Together, the mega-region’s manufacturing sector directly employs 418,300 workers.
  • In the U.S., nearly 87 percent of manufacturing job losses from 2000 to 2010 were caused by productivity increases as opposed to the relocation of jobs attributed to trade.
  • More than 51 percent of trade within Cali Baja is in the service sector. These include:
    • $7.6 million in computer systems design and related services
    • $3.5 million in scientific R&D services
    • $2 million in software publishers

“It is clear that the cross border economic relationship plays a critical role in the Cali Baja mega-region in spurring economic growth, advancing technology, and enhancing lives on many levels,” said Melissa Floca, associate director of the Center for U.S.-Mexican Studies, a top policy research center for U.S.-Mexico relations. “These findings underscore the importance of continued cooperation between Mexico and the U.S. to enhance the value we create as a region in services and advanced manufacturing.”

Cross border production sharing has made North America more integrated, more resilient, and more competitive; it has also served to insulate our economies from other global competitors like China. By 2020, however, more than half of all U.S. exports will be in services, not goods. Establishing a robust framework for IP protections, data transfer, and privacy will be essential in ensuring that North America remains competitive in the global economy.

“In the Cali Baja mega-region, we continue to strengthen our binational ties by working closely together to improve economic prosperity on both sides of the border,” said San Diego Mayor Kevin L. Faulconer, who attended the launch event. “We’ve built that strong bond through the exchange of goods and we’re now seeing that expand to high-level services that cross the border thanks to the digital era we live in. This new study proves that free trade is working for our mega-region and why continued collaboration is so important.”

Read the full study here; also available in Spanish here.

For more research from San Diego Regional EDC – World Trade Center San Diego’s parent organization – please visit: sandiegobusiness.org/research-center.

The report was produced by World Trade Center San Diego, with research support from Center for U.S.-Mexican Studies at UC San Diego’s School of Global Policy & Strategy. The research was underwritten by SAMSUNG.

 

June 27, 2018

So far, 2018 has been a year of transition for EDC. Research performed through a partnership with the Brookings Institution led us to some startling findings about how inequality and affordability pose a threat to the San Diego region’s economic competitiveness. These findings helped to build a case for if and how an economic development organization (EDO) can play a role in region-wide efforts to promote an inclusive economy. Organizations across San Diego have been working for decades with much avail to elevate underrepresented populations, bolster small businesses, and improve quality of life for more local residents. But where does an economic development organization fit in?

For more than 50 years, EDC has been the voice of the business community – lauding the accomplishments of our life sciences, tech, and defense industries. The success of San Diego’s innovation economy has positioned the region for sustainable growth, but in an economy nearing full employment, even the most cutting-edge businesses struggle to find and retain the workers they need to remain competitive.

A strong economy is an inclusive economy, in which residents, businesses, and communities all have the opportunity to contribute and reap the benefits of growth. Over the last quarter, a regional steering committee, supported by technical advisory groups, has embarked on an ambitious effort to develop and drive an agenda that points the region toward a more inclusive economy, and thus, a stronger economy. This agenda will articulate the economic imperative for taking action, identify broad regional goals, and provide concrete recommendations around three pillars of influence: building a strong local talent pipeline, increasing small business competitiveness, and increasing affordability. This process is one that will not be accomplished overnight, but here’s an update on EDC’s progress, followed by some engagement opportunities for those ready to take action now.

Progress update:

  • Inclusive growth steering committee: made up of more than 40 leaders representing academia, nonprofit, and private sector. The steering committee convened for its second gathering to set a regional target for the first pillar of the inclusive growth strategy: building a strong, local talent pipeline. This regional target aims to increase the number of post-secondary degree holders by 2030. Details to come.
  • Advisory group on a creating a strong local talent pipeline: To arrive at this target for building a strong local talent pipeline, the steering committee was informed by an advisory group of 15 subject-matter experts, who met for three working sessions in Q2. These sessions were filled with data-driven discussions on skills, workforce requirements, demographic shifts, and more to help the steering committee arrive at a regional target.
  • Advisory group on small business competitiveness: To begin strategizing for the second pillar of this effort, the advisory group on increasing small business competitiveness met in Q2, as well. To inform this process, EDC, in partnership with the Small Business Development Center, has deployed a mass small business needs assessment survey to better understand challenges facing small business owners. The small business advisory group will analyze survey results to inform a regional target for increasing small business competitiveness. Take the survey here.

Engagement opportunities:

Building an employer-led coalition on inclusive growth will take time and collaboration across multiple industries, nonprofits, academia, and philanthropy. EDC is working hard with our partners and stakeholders to ensure we remain thoughtful and strategic in addressing these regional challenges. That said – we understand you may be tired of talking and ready to take action. Below are just a few opportunities to engage.

  1. Provide a San Diego small business the opportunity to increase its competitiveness through a free coaching program by nominating a small business for the Inner City Capital Connections Program, sponsored by Kaiser Permanente.
  2. Help us better understand the challenges facing our small businesses by taking the small business needs assessment survey.
  3. Showcase career paths for San Diego’s students by hosting a virtual tour as a part of Cajon Valley School District’s World of Work program or contact Ed Hidalgo, Chief Innovation and Engagement Officer at Cajon Valley Union School District - hidalgoe@cajonvalley.net.

We’re just getting started; much more to come. Learn more.

By Kate Gallagher, economic development coordinator

June 21, 2018

In the past two decades, San Diego County Water Authority has invested more than $2.4 billion in five major water reliability projects. A new study released by EDC in partnership with the San Diego County Water Authority, quantifies the impact these investments have on our broader economy. These projects have generated $4.8 billion in total economic impact, supporting an average of 1,475 jobs annually over two decades and creating more than $1.8 billion in local wages and salaries.

The report also found that access to safe and reliable water supplies supports $482 million in total regional sales of goods and services daily – equivalent to the economic impact of nearly three Comic-Cons every day.

In addition, the report shows that more than 2,800 people work in the water and wastewater sectors at the Water Authority and its 24 member agencies. The water industry provides career opportunities across all levels of educational attainment, in everything from customer service to engineering. 

SDCWA has kicked off the "Brought to you by water" campaign to share the impact of water across multiple industries. 

 We all know that water is essential for the viability of our communities, but we often take that for granted and that is a luxury,” said Janice Brown, chair of the EDC’s Board of Directors.  “Without the infrastructure: pipelines, dams, treatment plants - we would not have reliable water. Reliable water makes us economically competitive."  

 
If interested in an economic impact analysis of your company or project, get in touch with EDC's research team