Each month the California Employment Development Department (EDD) releases employment data for the prior month. This edition of San Diego’s Economic Pulse covers December 2019. Check out EDC’s research bureau for more data and stats about San Diego’s economy.
The region’s unemployment rate was 2.8 percent in December 2019, down from a revised 2.9 percent in November 2019, and below the year-ago estimate of 3.1 percent
The region’s unemployment rate remains lower than both the state and national unemployment rates of 3.7 percent and 3.4 percent, respectively
Between November 2019 and December 2019, total nonfarm employment increased from 1,538,200 to 1,540,700, adding 2,500 jobs
Between December 2018 and December 2019, total nonfarm employment increased from 1,505,900 to 1,540,700, adding 34,800 jobs
Between December 2018 and December 2019, professional and business services led the year-over gain, adding 9,500 jobs and mostly driven by growth in professional, scientific, and technical services (up 7,500)
Each month the California Employment Development Department (EDD) releases employment data for the prior month. This edition of San Diego’s Economic Pulse covers November 2019. Check out EDC’s research bureau for more data and stats about San Diego’s economy.
Every quarter San Diego Regional EDC analyzes key economic indicators that are important to understanding the regional economy and the region’s standing relative to the 25 most populous metropolitan areas in the U.S. This issue covers data from Q3 2019.
Over half of the 24 most populous metros experience a decline in total nonfarm employment during Q3 from Q2, including San Diego. The region saw a decline of 2,200 jobs – a 0.1 percent decrease in total nonfarm employment from Q2 to Q3, primarily due to seasonal changes. On the other hand, compared to a year ago, nonfarm employment was up 30,600, or 2.1 percent.
Key findings from the snapshot:
San Diego’s unemployment continues to drop, at 2.7 percent in Q3
While there was a decrease in nonfarm employment from Q2 to Q3 2019 due to seasonal changes, annual nonfarm employment was up 30,600 jobs, or 2.1 percent compared to Q3 2018
San Diego’s housing market was the third most expensive in the nation, despite home prices decreasing in Q3 both quarterly and annually
Housing permits increased substantially year-over-year in San Diego, largely due to multi-family housing permits increasing by nearly 133 percent
Overall, total housing permits increased nearly 68 percent compared to a year ago
San Diego saw 34 VC deals worth $707 million
Quarterly Economic Snapshot analyzes key economic indicators that are important to understanding the regional economy and the region’s standing relative to the 25 most populous metropolitan areas in the U.S. This releases includes data from July to September (Q3) 2019.
Each month the California Employment Development Department (EDD) releases employment data for the prior month. This edition of San Diego’s Economic Pulse covers October 2019. Check out EDC’s research bureau for more data and stats about San Diego’s economy.
The growth of San Diego’s innovation economy has made the region better educated and more prosperous than most other metros. However, this economic transformation presents new challenges for future growth. Changing skill requirements, a nationwide battle for talent, and a soaring cost of living are combining to form an unequivocal threat to our regional competitiveness. If unaddressed, San Diego will no longer be an attractive place to live and do business.
San Diego depends on a highly-educated workforce. However, talent shortages are likely to grow as demand for new skills accelerates and demographic gaps in educational attainment persist. The lack of quality jobs and a high cost of living further impact talent attraction and retention. For the region to remain competitive, an inclusive economic development strategy is needed. As part of San Diego’s Inclusive Growth Initiative, this research was produced by San Diego Regional EDC.
From December 2018 and January 2019, the San Diego Small Business Lending Collaborative surveyed 129 existing and 101 prospective business owners in three San Diego Promise Zone zip codes (92102, 92113 and 92114). The purpose of the survey was to identify barriers for small business establishment and growth within the San Diego Promise Zone, a geographic area comprising of Barrio Logan, Southeastern San Diego, and Encanto. Historically disadvantaged, the culturally rich communities within the San Diego Promise Zone possess unique barriers that inhibit economic growth.
The study, written by the San Diego Regional EDC, found that the biggest challenge business owners face is related to credit/financing. Only 12 percent of business owners have ever applied for business financing, and out of those who have, they found only expensive options or were declined due to bad credit or income requirements. The final report outlines recommendations and strategies for small business owners in the San Diego Promise Zone to overcome these obstacles and grow their companies. For example, expanding access to entrepreneurship training and accelerator programs for low to moderate income populations.
In an effort to address San Diego’s soaring cost of living, San Diego Regional EDC and its Inclusive Growth Steering Committee of 40 employers officially endorsed a regional goal to create 75,000 newly thriving households by 2030. Driven by the findings in EDC’s latest study release, this regional goal and accompanying set of recommendations aim to address key factors (housing, transportation, and childcare) impacting San Diego’s affordability crisis – the last of three main goals of a regional Inclusive Growth agenda.
“While San Diego’s affordability crisis impacts everyone in the region, it has a disproportionate and devastating impact on African American and Hispanic communities,” said Mark Cafferty, president and CEO, San Diego Regional EDC. “The lack of affordable housing is a significant part of the problem, but those impacted are also the same residents who are dealing with the longest commute times, childcare deficits, limited connectivity to public transportation, and other barriers that make access to high-wage, high-skilled jobs particularly more difficult and burdensome.”
ADDRESSING SAN DIEGO’S AFFORDABILITY CRISIS In its new study, EDC found that the majority of household incomes in San Diego do not meet the region’s expected cost of living ($96,000 annually for owner-occupied households and $61,000 annually for renter-occupied households). The cost of housing – twice the average among U.S. metros – is the primary driver of the region’s growing cost of living, pushing residents further away from job centers and resulting in longer commute times and increased cost of transportation.
Additional key findings include: • Affordability:San Diego is 47 percent more expensive than the average U.S. metro. • Housing:Half of all homeowners do not earn enough to cover their cost of living, and nearly 60 percent of all renters fall thousands of dollars short each year. • Transportation: The average household spends more than $14,000 on transportation and travels nearly 20,000 miles over the course of a year. • Childcare: There are now nearly twice as many children under the age of six with working parents as there are licensed childcare spaces available.
With the fifth highest median home price, staggering commute times for its poorest residents, and substantial childcare shortages, San Diego’s high cost of living not only impacts the region’s existing workforce, but also the pipeline of future talent.
“It is becoming more challenging to recruit talent from out of the San Diego region because San Diego is not an affordable place to live. This is especially true in higher education where many competitors for talent are in low-cost college towns,” said Thom Harpole, human resources director, San Diego State University. “Salary and benefits packages alone are not adequate to address the problem. Affordability in San Diego must be addressed to ensure the health of our communities and the success of our organizations in delivering on their missions.”
If the region’s housing, transportation, and childcare costs continue to rise at this rate, San Diego will no longer be an attractive place to live or work. To address this affordability crisis, the Inclusive Growth Steering Committee has endorsed a regional goal of creating 75,000 newly thriving households by 2030. To meet this new regional goal, San Diego must increase the proportion of households that can afford the region’s true cost of living from 47 percent to 55 percent. This means more housing, more transportation options, and more childcare. It also means growing household incomes through the local development of skilled workers and creation of more quality jobs.
“San Diego’s cost of living significantly impacts our ability to attract and retain talent from other destinations,” said Clifford “Rip” Rippetoe, president and CEO, San Diego Convention Center Corporation. “We need to be creative to compete. We work to make sure that all of our employees have the opportunity to thrive in San Diego.”
The Inclusive Growth Steering Committee has recommended that employers support the regional goal through the following actions: 1. Transparency – understand the impacts that lack of affordability has on existing workforce and talent pipeline. 2. Engagement – participate in public policy dialogue around infrastructure development to address the region’s affordability challenges. 3. Investment – invest in programs and projects that help ameliorate cost of living pressures on workforce.
Employers that have officially endorsed this goal and recommendations include San Diego State University, San Diego Convention Center, Booz Allen Hamilton, Cox Communications, Northrop Grumman, and more. For a complete list of employers committed to this effort, visit the new interactive web study.
EDC’S INCLUSIVE GROWTH INITIATIVE In 2018, EDC launched a data-driven, employer-led initiative focused on promoting inclusive growth as an economic imperative. Together with its Inclusive Growth Steering Committee, EDC has set collaborative regional goals, endorsed actionable recommendations for accomplishing them, and will continue to monitor its regional progress towards building a strong local talent pipeline, equipping small businesses to compete, and addressing San Diego’s affordability crisis.
In an effort to address San Diego’s soaring cost of living, San Diego Regional EDC and its Inclusive Growth Steering Committee of 40 employers officially endorsed a regional goal to create 75,000 newly thriving households by 2030. Driven by the findings in EDC’s latest study release, this regional goal and accompanying set of recommendations aim to address key factors (housing, transportation and childcare) impacting San Diego’s affordability crisis – the last of three main goals of a regional Inclusive Growth agenda.
Each month the California Employment Development Department (EDD) releases employment data for the prior month. This edition of San Diego’s Economic Pulse covers August 2019. Check out EDC’s research bureau for more data and stats about San Diego’s economy.
In an effort to provide residents with increased access to high-demand jobs, San Diego Regional EDC launched Advancing San Diego, a $3 million local investment initiative underwritten by JPMorgan Chase. The program will align industries with economic development, workforce development and education systems.
“Talented and skilled workers are integral for a strong economy,” said Mark Cafferty, president & CEO at San Diego Regional EDC. “With and through our program partners and stakeholders, we are establishing a first-of-its-kind, employer-led initiative that will measure and aggregate workforce needs while also indentifying solutions that align and strengthen our local education systems. We need to ensure that the benefits of our region’s growing innovation economy are reaching all San Diegans.”
Advancing San Diego will establish nine working groups that are designed to give employers a collective voice about talent needs in priority industries, ranging from software and technology to marketing, healthcare and more. In the first report, 17 participating employers expressed a projected need for more than 7,200 additional software-related positions over the next three years.
As San Diego’s economy continues to expand, employers are seeing an increased demand for skilled workers. While San Diego strives to attract and retain talent, it must also look inward to build a workforce that meets demands for current and future jobs. EDC and its Inclusive Growth Steering Committee of 40 employers have endorsed a regional goal to double the number of skilled workers produced in San Diego County to 20,000 per year by 2030. This requires strong, effective learning programs offered by community colleges and other education institutions.
The goals of Advancing San Diego are to:
Engage employers in a structured process to collectively communicate talent needs
Identify education programs that are aligned with industry needs
Increase the pool of diverse, skilled talent in San Diego
Expand access to talent pipelines for small companies
“By 2020, nearly two of every three jobs in the U.S. will require a credential or degree, and currently, 90 percent of our students remain in San Diego after graduation,” said Dr. Sunita “Sunny” Cooke, superintendent & president at MiraCosta Community College District. “Community colleges play a critical role in creating a diverse talent pipeline for the region. The Advancing San Diego program willhelp connect the work occurring within local community colleges to ensure we offer innovative curricula that support employer needs and include opportunities for students to apply their learning in workplace settings so graduates are ready for employment.”
Education systems that are aligned with results set forth by the working groups will be listed as ‘preferred providers’ by Advancing San Diego. This designation rewards higher education students with priority access to work-based learning and engagement opportunities via networking events, career and internship fairs, and local company tours. To learn more and become a ‘preferred provider,’ educators are encouraged to apply at advancingSD.org.
“Start-ups like LunaPBC are rich with mission, purpose, and the opportunity for personal and professional growth,” said Dawn Barry, co-founder & president at LunaPBC. “Unlike large employers, startups are often lower on salary, but offer exciting equity and the opportunity to experience first-hand what it’s like to build an enterprise. When large employers work together with smaller employers, and pursue partnerships with incubators and accelerators, higher education and regional development teams, we strengthen our collective visiblity as a region for career development.”
Report: Demand for Software Talent and Criteria for ‘Preferred Providers’ Working group members were asked to provide hiring projections along with skills and competency requirements for critical jobs, in order to identify programs that align with industry needs. Collectively, these results were compiled into the Demand for Software Talent Report and will create a criteria for ‘preferred providers’ of software – a designation by employers that demonstrates an education program is providing adequate training for software engineers.
Companies that contributed to this report represent industries with the highest proportion of software talent in San Diego, including tech, life sciences, healthcare and defense. Based on the participation of 17 employers who collectively employ approximately 53,000 people and share a need for software talent, this report indicates the working group is projected to hire more than 7,220 additional software professionals over three years.
Software engineers accounted for the highest future hiring demand among all software occupations in working group companies, making up 53 percent of total projections
Entry-level software engineers represent the highest hiring need of any position at any level
Collectively, the working group projects they will hire more than 1,700 entry-level software engineers over the next three years
Approximately 44 percent of working group employers require a bachelors degree for entry-level software engineers
Through the Advancing San Diego collaboration, San Diego strives to cultivate a more inclusive economy, as this initiative will look inward to address regional talent shortages and strengthen the relationship between employers and education systems.
For more information about the new Advancing San Diego initiative, future working groups, or to be listed as a ‘preferred provider, visit advancingSD.org. Follow along and join the conversation at #advancingSD.