San Diego’s Economic Pulse: January 2021

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 2020 and reflects some effects of the coronavirus pandemic on the labor market. Check out EDC’s research bureau for more data and stats about San Diego’s economy.

Key Takeaways

  1. San Diego lost 5,300 jobs, on net, in December, which is not typical during the holiday season.
  1. The unemployment rate jumped to 8.0 percent from 6.6 percent in November amid job losses and growth in the labor force.
  1. San Diego’s “K-shaped” recovery will exacerbate longstanding structural problems in the economy, making the case for an inclusive growth strategy even stronger.

Labor Market Overview

San Diego’s labor market suffered a setback in December after new business restrictions were put into place to combat a surge in COVID-19 infections and an alarming decline in ICU bed capacity. Local employers let go of 5,300 workers, on net, last month, lifting the unemployment rate to 8.0 percent from 6.6 percent in November. A drop in employment for the month of December is atypical, since holiday hiring is usually in full swing. Last month’s decline marks only the sixth time in 72 years where employers have let more workers go than they hired in December.

San Diego’s unemployment rate is lower than California’s 8.8 percent but significantly higher than the nation’s rate of 6.5 percent in December.

The causes for the rise in San Diego’s December unemployment rate are two-fold, and the news isn’t entirely bad: First, and most obviously, job losses drove the rate higher. However, this was compounded by an increase in the labor force of 12,200 people. The labor force vacillated for most of 2020 but ended the year close to its February, pre-pandemic level—good news for the labor market heading into 2021, if it is sustained.

Industry View

Leisure and Hospitality employers let go of 9,600 workers in December, which was more than enough to lower total employment. The lion’s share of hospitality job losses came from Accommodation and Food Services, which gave back 10,300 positions. Other Services, Government, Manufacturing, Educational Services (private, non-government), and Financial Activities each lost jobs. However, the losses for all of those industries totaled just 4,300, less than half of the layoffs experienced in Accommodation and Food Services alone.

The weakness in Leisure and Hospitality drove an even larger wedge between the jobs recovery for high-paying and low-paying positions, exacerbating a worrisome trend where the income and wealth gaps in San Diego will likely widen exponentially as a result of the pandemic-fueled recession.

Despite the decline in topline employment, job gains were apparent in a number of industries. Business and Professional Services added a healthy 2,500 workers in December, fueled by a gain of 2,700 in the crucial Professional, Scientific, and Technical segment, while retailers brought on 1,900 additional employees despite weak retail sales.

Behind the Numbers

All in all, December’s lackluster employment report is a downer, but not an unexpected one. With COVID-19 cases surging in the region and hospitals running out of valuable space for patients, business restrictions became necessary from a public health perspective.

As mentioned, the decline in employment last month is not typical for December, but it may bode well for January’s employment report. Under more normal circumstances, January typically reveals job losses as seasonal workers are let go. However, given that seasonal hiring was more tepid in 2020, layoffs in January may be less pronounced.

Labor force growth in December is also encouraging if it can be sustained. The extension of federal emergency unemployment benefits should help to keep a floor under the workforce, since only people in the labor force can claim them. Additionally, despite the sharp drop in Leisure and Hospitality employment last month, many firms in the region are still hiring. Therefore, we can expect people to remain in the labor force as long as job growth resumes as we enter 2021.

Unfortunately, these are about the only silver linings in December’s jobs report.

Annual revisions to the 2020 jobs numbers will be released by California EDD on Friday, March 12. Typically, revisions show greater job losses than were initially reported during recession periods. This is because the Labor Department estimates the pace of business formations in a given month, which usually assumes the addition of at least some new jobs as new firms come online. However, a Census-like count of business formation carried out after the initial estimates are released usually shows more business closures, on net, which thereby reduces the level of employment. So, in all likelihood, 2020 revisions could reveal deeper job losses last year than initially reported.

The shape and timbre of the jobs recovery means that even more work will be needed to shore up the local economy. The exponential widening in wealth and income gaps from the “K-shaped” recovery to-date will mean even more aggressive policies aimed at protecting and empowering our lowest-paid workers. Also, declines in the labor force earlier in 2020 were in large part the result of women leaving the workforce. If 2021 exhibits a repeat of that contraction, then it will almost certainly lead to greater disparities in gender pay. Finally, housing has continued to become even less affordable amid high unemployment and rising home values across the region.

It will take intentional and effective action to get this recovery right. It is now more important than ever to ensure greater access to higher education and worker training for our region’s lower-income households. Additionally, companies may also want to consider employee-ownership models, like the one Taylor Guitars recently announced, to give workers a larger stake in their economic fortunes. By offering a pathway to higher paying, more stable employment, we can ensure a more resilient and vibrant San Diego in the future, which will benefit all of us for decades to come.

Learn more about San Diego’s right recovery

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Economy in crisis: Structural challenges will persist after economy recovers

Key Takeaways

  1. San Diego’s jobs recovery has left the lowest-paid workers behind.
  1. Disproportionate job losses and the possibility that lower-paid residents will owe large sums in back-rent will exponentially exacerbate wealth inequality.
  1. Lower mortgage rates drove up house prices, making housing even less affordable despite record job losses and elevated unemployment.

Needless to say, 2020 was a rough year. But it was far worse for some than others.

San Diego employers added a better than expected 14,300 jobs in November, including a generous push by retailers who put 1,800 people back to work even as retail sales backtracked. Nonetheless, the “K-shaped” recovery has persisted, where middle- and upper-income workers either never lost or quickly recovered their jobs while lower-income jobholders were furloughed indefinitely or laid off.

As of November, San Diego nonfarm employment rested 6 percent below its February 2020 peak. However, jobs paying less than $41,000 per year—the threshold associated with quality jobs in the region—remained stuck 18 percent below their pre-COVID peak. Moreover, low-income employment cratered by some 43 percent from February to April last year, compared with 15 percent for all jobs.

Additionally, six industries, including Professional, Scientific, and Technical Services, have reclaimed all of the jobs lost to the COVID downturn, whereas wholesalers have recouped a meager 11 percent of the positions cut last year and information has only recovered one in eight positions.

This could have lasting impacts even after the jobs recovery is complete.

More than 60 percent of workers in the lowest-paid positions in San Diego are non-white versus 56.6 percent in all industries. So, to add “injury to insult,” minority workers that have suffered through months of intense social unrest this past year have simultaneously juggled disproportionate job losses.

Fortunately, eviction moratoriums were put into place last year that prevented many people from being evicted for nonpayment. But landlords can once again legally collect on back-rent or issue evictions if the statewide moratorium is lifted on January 31. People making less than $41,000 are far more likely to live paycheck-to-paycheck. In other words, a large swath of the population is entering 2021 with sizeable arrears to be paid off—something that’s tough enough for low-income workers even while employed, and even more difficult for the 18 percent of these folks who are still without jobs.

Worse, the wealth effects from this downturn have been particularly stark. Middle- and upper-income workers—most of whom already had some sort of savings and are much more likely to be homeowners—have been able to capitalize on lower interest rates and higher stock valuations all while holding onto their jobs. Meanwhile, most people making less than $41,000 a year were unable to amass significant savings, let alone any sort of real wealth, in the months and years leading up to 2020. The outright loss of income for so many of these workers most likely means an exponential widening in the wealth gap in San Diego.

HOMEOWNERSHIP EVEN LESS ATTAINABLE

Speaking of lower interest rates, San Diegans took full advantage of the 210-basis point drop in the 30-year fixed mortgage rate between November 2018 and November 2020.

San Diego’s housing market is significantly more sensitive to mortgage rates than many other parts of the state and country, in no small part because of the high cost of living in the region. In November 2018, when the average 30-year mortgage rate was 4.9 percent, the median home value was $659,500. A mortgage financed on that amount, minus a 20 percent down payment, would have totaled $1,008,118 over the life of the loan, or $2,800 per month. However, the cost of that same mortgage after the 30-year rate dropped to 2.8 percent would be $780,496, or $227,622 less than the 4.9 percent loan and $2,168 per month. Given all of this, rising home prices over the past two years or so make sense from a microeconomic point of view.

Even so, a 22 percent year-over-year increase in home prices as of December 2020 amid record job losses and elevated unemployment seems suspect. Indeed, calculating a housing affordability index that takes unemployment into account shows that housing has become increasingly unaffordable.

WE MUST TAKE ACTION

In sum, San Diego is likely to face myriad structural issues long after the economy has technically emerged from recession. Income and wealth gaps are likely to have been widened just like they have after each recession for the past 30 years. And jobless residents who were afforded a temporary reprieve from being evicted may find themselves in a situation where they owe large sums of money to their landlords.

A debt-ridden middle and upper-middle class has been tough enough on the economy as college graduates pay off their student loans. However, lower-income households tend to spend a much larger share of their paychecks than middle- and higher-income households, so having these funds siphoned off into repaying back-rent could disrupt consumer spending even more markedly for months, if not years, after the dust settles.

It will take more than just empathy to bridge these gaps and get this recovery right. It is now more important than ever to ensure greater access to higher education and worker training for our region’s lower-income households. Additionally, companies may also want to consider employee-ownership models, like Taylor Guitars, to give workers a larger stake in the economic fortunes of the businesses they work for. By offering a pathway to higher paying, more stable employment, we can ensure a more resilient and vibrant San Diego in the future, which will benefit all of us for decades to come.

Learn more about San Diego’s right recovery

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7 COVID-19 resources for small businesses – January 2021

With new federal and state legislation enacted over the holidays, it can be challenging to sift through what’s available for businesses. Below, EDC has outlined seven new and ongoing support/resources available as businesses navigate impacts of COVID-19.

1. COVID Relief Grant Program

The State of California launched a $500 million COVID Relief Grant Program for small businesses that have been impacted by the pandemic and accompanying safety restrictions. Eligible underserved small businesses and nonprofits may apply for up to $25,000 in grant funds. Apply by Wednesday, January 13.

Please note: Applications are not first-come, first-served. Take the time to ensure your application is accurate via San Diego and Imperial SBDC Network‘s on-demand webinars (in English and Spanish).

2. Economic Injury Disaster Loan (EIDL)

The EIDL grant program has reopened applications for grants up to $10,000. Businesses that did not previously receive the grant can apply, with priority given to small businesses with less than 300 employees, located in low-income neighborhoods, and that have experienced a 30 percent reduction in gross receipts. Apply now.

3. Paycheck Protection Program (PPP)

Companies with fewer than 300 employees that have experienced a greater than 25 percent reduction in gross receipts will soon be able to apply for a second PPP loan, with priority given to hardest-hit industries. Companies may receive both a PPP loan and EIDL loan without compromising PPP forgiveness. PPP loans are nontaxable and will be forgivable if used for appropriate expenses. For more information, visit the SBA website.

4. San Diego County Small Business Stimulus Grant

Small businesses and nonprofits with fewer than 100 employees may apply to receive grant funding. Final awards will be made by individual district offices based on availability of funds, program guidelines, and the submission of all required information. Apply now.

5. Employee Retention Tax Credit

Companies may now receive a credit against employment taxes for up to 70 percent on $10,000 in wages per quarter (or a maximum $14,000 per employee through June 30). Employers that experienced a decline of more than 20 percent in gross receipts may apply. For more information, visit the IRS website.

6. Employee Training Panel COVID-19 Pilot Program

Manufacturers in select industry sectors including food and medical manufacturing may receive assistance for training new and rehired employees. The program provides a training off-set for as little as four hours of training per new or rehired employee earning at least $17.50 per hour. For more information, visit the State website.

7. California Competes Tax Credit

Companies of any industry, size, or location may apply for part of $180 million available in tax credits to relocate or stay and grow in California. For more information on eligibility and assistance, visit the State website or apply by January 25.

EDC is here to help. Request our help finding information, applying to these relief programs, and more, at no charge.

Request EDC assistance

 

For more COVID-19 recovery resources and information, please visit this page.

 

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Economy in crisis: Job growth slows as we head into New Year

KEY TAKEAWAYS

  1. After an impressive October employment report, San Diego is set to end the year on a down note.
  1. Job growth in November is expected to slow, similar to the U.S., and fresh stay-at-home orders set the stage for a weak December and January.
  1. The string of weak employment expectations could delay a return to full employment from Spring 2021 to the Fall.

Given the way 2020 has unfolded to date, it’s only fitting that the year would end with a fizzle instead of a sizzle.

It looks like November’s jobs report for San Diego will serve up a slowdown similar to what was seen nationally. For the U.S., payroll job growth slowed substantially from 610,000 net jobs gained in October to a worse-than-expected 245,000 in November, on a seasonally adjusted basis. On a not-seasonally-adjusted basis, which is how the San Diego employment figures are delivered, U.S. job gains were cut by about two-thirds, from 1,587,000 in October to 517,000 in November. The fortunes of San Diego’s job market are tightly tethered to those of the nation’s, so we can expect a similar dynamic to play out here.

We won’t know for sure until the San Diego jobs numbers are officially released next Friday, December 18. But we can surmise some baseline conclusions based on the U.S. jobs numbers, California continuing claims for unemployment insurance, and recent stay-at-home orders issued by the state and county.

Based on the historical relationship between U.S. and local employment, it looks like San Diego gained anywhere between 7,500 and 8,000 jobs in November, down considerably from 21,500 the month prior. Moreover, some push and pull between industries will likely emerge.

The unemployment rate, which is calculated using a different survey than the one used to estimate nonfarm payrolls, appears poised to fall further despite the anticipated slowdown in payroll job growth. After falling 1.2 percentage points in October, from 8.9 percent to 7.7 percent, the rate could fall to around 7 percent in November. October’s employment report showed that a record 55,800 workers joined or rejoined the labor force, which has the effect of pushing the unemployment rate higher. So, if any of the mad rush back into the labor market was reversed last month, then the jobless rate could be shown to have fallen even as low as 6 to 6.5 percent.

SOFT END TO THE YEAR?

With the labor market slowing in November, it seems like a safe bet to assume a setback is in the cards for December, especially in light of the most recent COVID-19 shutdown orders. This certainly appeared to be the case in July when San Diego County reissued directives for non-essential businesses to halt or reduce operations as COVID infections surged and employment took a step back.

However, since San Diego’s job numbers are not adjusted for seasonality like the national figures, it’s important to realize that monthly employment patterns may reflect the seasonal ebb and flow of the job market. Looking back through history, San Diego has experienced July employment declines in 54 of the past 72 years that data are available, making it especially tough to tell if the dip this past summer was shutdown-related or simply a normal seasonal occurrence. In fact, the drop in July was just about average—slightly less so, actually—than those seen in most other years.

On the other side of the coin, employment has climbed in every December, except five, in the last 71 years as holiday hiring picked up. So, barring a double-dip recession in the region, the odds of any large-scale net job losses in December are slim. The more likely outcome is a slower-than-average job build if retailers and leisure businesses don’t bring on their usual volume of holiday staff—quite likely, given the fresh round of stay-at-home orders issued for the county.

MIXING THE INGREDIENTS TOGETHER

All in all, San Diego is looking at a string of underwhelming employment reports over the next several months. November will not repeat October’s healthy gains, and December could be flat to very modestly negative as holiday hiring is on pause amid COVID-induced shutdowns. January tends to show job losses as temporary holiday help is let go. However, if December holiday hiring is less robust than normal this year, then there will be fewer holiday workers exiting the payrolls in the beginning of next year. Nonetheless, most companies don’t tend to bring on many new hires in January, since interviewing and onboarding job candidates is usually interrupted by the holidays in November and December, setting the stage for a pretty weak month regardless.

It was recently mentioned that San Diego could return to full employment by April of next year if the average pace of hiring from April to October of this year was maintained. However, this is looking less and less likely, and a weak to flat November and December would put full employment closer to Fall 2021.

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Advancing San Diego Intern Spotlight: Kailyn King, ZUM Radio

The Advancing San Diego (ASD) Internship Program launched this Spring in a remote-capacity amid the COVID-19 pandemic and aims to provide up to 100 San Diego-based companies with fully subsidized interns. This program targets companies with 100 employees or less, which comprise 98 percent of all businesses in San Diego, employ nearly two thirds of San Diegans, and account for 70 percent of job growth. A key issue for these companies has been a lack of time and resources to recruit the skilled talent necessary to continue their growth.

As students close out their Summer internship experiences—and as we recruit a new cohort of companies and interns—EDC has launched this blog series to highlight the innovative local companies that comprise the first cohort of the program and the interns they hosted.

In this feature, we sat down with ZUM Radio intern and California State University (CSU) San Marcos student Kailyn King. A part of the inaugural cohort of host companies, ZUM Radio is a San Diego-based software company that manufactures radio-frequency transceivers for the amateur radio community. King is a computer science transfer student that began her studies at Oceanside’s MiraCosta College and is now in her first year at CSU San Marcos.

Read on for more from Kaylin.

How has your experience in the ASD Internship Program been, and what projects have been the most meaningful?

Applying for an internship through ASD and being connected with ZUM Radio proved to be a seamless transition from my coursework in community college to industry-based work. My supervisor Jim McLaughlin was excellent in relating the skills I had to new applications and opportunities for growth. My tasks included contributions to an open-source Android mobile application, revising a C program for a Raspberry Pi USB device, and writing guides on how to set up handheld transceivers for communicating on-air. Through this, I gained invaluable practical experience working for a project manager under a specific timelines. Above the technical knowledge, I learned the most about how to effectively communicate through email and daily Scrum meetings. Some of my biggest takeaways from this internships were practicing the management of expectations and keeping my colleagues informed about my progress on each project.

How has the COVID-19 pandemic affected your day-to-day, and what challenges have you faced as a student?

Although I am no stranger to spending a lot of time in front of a computer, this new modality of fully-online learning has challenged my ability to dedicate time and energy throughout multiple classes. It is sometimes hard for me to focus as I typically stay at home for remote work and school. I now do my best to diversify my environment by studying in different locations, walking my dog through new routes, and running outside a couple times a week. We are all constantly subjected to the stresses of the pandemic, so it is important to have patience with ourselves as we work to the best of our abilities under these unusual conditions.

What advice would you give to students looking for a successful career in the local software industry?

Recognize that good company is all around you. Communicate often and be open with your colleagues, mentors, and potential employers. Your background, perspective, passion, and hard work will be recognized as you continue to reach out towards new and challenging opportunities.

We’re now accepting applications for small companies in need of business interns! Learn more about ASD and our internship program

Apply here by Dec. 18

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Economy in crisis: SD housing market advances, but geographic differences remain

KEY TAKEAWAYS

  1. Despite ongoing economic pressure, San Diego home values and rents reached new peaks in October.
  1. Home prices and rents are highest along the coast, but price increases have been most pronounced in more rural, inland areas of the county.
  1. Areas in the county with the highest unemployment rate tend to have the lowest cost of living, however prices are increasing quickest in those areas.

San Diego home prices and rents continued to rise in October, despite the ongoing economic pressures presented by Covid-19 and efforts to contain the virus. According to Zillow, the median value of a middle-tier home advanced 1.6 percent from September to reach a new peak of $649,474*, up 7.3 percent from February and up 9.5 percent from a year ago. Meanwhile, average rents reached $2,363, also a fresh high, up 1.4 percent from February and 2.1 percent from a year earlier.

San Diego home prices and rents are both growing faster than other large California metro areas like San Francisco, Los Angeles, and Santa Barbara, as well as the U.S. average. Even so, San Diego’s record-breaking house prices and rents are not unique. Of the 914 metropolitan and micropolitan regions covered, Zillow reported new home price peaks in 645 (71 percent) of them, and rents are topping out in 88 percent of 107 regions tracked by the real estate company.

San Diego home values are high, and they’re rising at an accelerated pace.

 

Rent increases have slowed but continue to climb faster than the U.S. and other California metros.

Sub-regional look presents an interesting picture

Housing price appreciation has been most pronounced in largely rural areas. Jacumba home values have surged by more than 23 percent over the past year, while prices in Ranchita, Tecate, and Warner Springs are all up between 18 and 19 percent. Yet, the median price for a home in Downtown has inched higher by a much less impressive 2.7 percent year-over-year.

A similar trend plays out when looking at rental values within the county. Rents in Ramona have jetted 15.8 percent higher over the past year, while Escondido rents are up some 6.5 percent. Coincidentally, rents have fallen in more central locations like University City, Carmel Valley, and Downtown.

Generally speaking, housing price appreciation and rental increases are most pronounced in areas where prices and rents are relatively low. This could reflect a natural migration out and away from the City of San Diego as buyers are seeking out price deals in more affordable, inland areas. This is especially true as those who are able to work from home no longer have to weigh as heavily the idea of a longer commute when deciding where to buy.

Also worth noting, is that home values and rental prices coincide with economic outcomes in these areas. For example, in Solana Beach, the median home price is more than $1.5 million, and the unemployment rate is just 4.2 percent—well below the county rate of 7.7 percent. By contrast, the median home price is $480,349 in National City, where unemployment is stuck at 11.5 percent. Similarly, rents are topping out at nearly $3,300 per month in low-unemployment Solana Beach, while renters are paying just over $1,800 per month in El Cajon where the jobless rate hovers at 11.4 percent.

The map below clearly shows how home prices and rents are growing in areas where properties are cheaper. Those regions are also the pockets of the county where joblessness is rampant.

Select between home prices, rents, and unemployment below using the ‘Metric’ dropdown, and choose between Level and YoY % change in the ‘Transformation’ dropdown to explore more.

ARE POORER SAN DIEGANS BEING PRICED OUT?

The relationship between home values (an indicator of how much workers in an area can afford) and labor market outcomes during the Covid-19 downturn shines a harsh light on the economic disparities affecting San Diegans with different socioeconomic backgrounds. Workers in areas where home values and rents are lower are far and away more likely to be without a job as Covid-related restrictions force business closures throughout the county.

This relationship statistically significant, offering up yet another piece of hard evidence that the most recent recession has disproportionately hurt poorer people.

What’s worse is that the torrid pace of price growth for homes and rental properties in higher-unemployment regions may force the most vulnerable San Diegans out of those areas as prices become unaffordable. This would exacerbate an already-troubling trend that has pushed more people out of the region than into it over the past decade.

Now, more than ever, we need to analyze our options and develop policies that help to prevent San Diegans from being priced out of the region. Cultivating and retaining a strong local workforce isn’t just about maintaining San Diego’s identity, it’s also about creating a stronger, more resilient region in coming years that will be better able to withstand the inevitable next downturn. Go here to learn more about how EDC is working to ensure San Diego gets this recovery right.

*Due to availability of data and varying sources, these numbers differ slightly from others we’ve recently posted.

Nate Kelley
Nate Kelley

Senior Manager, Research

Advancing San Diego Intern Spotlight: Emma Plum, Traits AI

The Advancing San Diego (ASD) Internship Program launched this Spring in a remote-capacity amid the COVID-19 pandemic and aims to provide up to 100 San Diego-based companies with fully subsidized interns. This program targets companies with 100 employees or less, which comprise 98 percent of all businesses in San Diego, employ nearly two thirds of San Diegans, and account for 70 percent of job growth. A key issue for these companies has been a lack of time and resources to recruit the skilled talent necessary to continue their growth.

As students close out their Summer internship experiences, EDC has launched this blog series to highlight the innovative local companies that comprise the first cohort of the program, and the interns they hosted.

In this feature, we sat down with Traits AI, Inc. intern and Mesa College student Emma Plum. A part of the inaugural cohort of host companies, Traits AI is a San Diego-based software company that creates animated artificial intelligence (AI) avatars that you can talk to, like you talk to Siri or Alexa. The company develops Alexa Skills, Google Assistant Actions, and chatbots for clients to help them better serve their customers; but its particular area of focus is on AI avatars that put a face to the voice using an animated avatar that looks like and sounds like the person they represent to help them extend their reach.

People are busy, especially those in in-demand professions like law, healthcare, consulting, and more. In these fields, there’s often only one point-person, but thousands of people who want a little bit of their time. While we cannot duplicate or replace those professionals, Traits AI can extend their reach by automating some of the repetitive parts of what they do on a daily basis. This frees them up to spend more time on things that require their unique skill set and expertise.

Read on for more from Emma.

How has your experience in the ASD Internship Program been, and what projects have been the most meaningful?

I enjoyed my time in the internship at Traits AI. My supervisor Brandon was very understanding and flexible with work schedules. My primary projects were working on Facebook Messenger bots/marketing campaigns and email marketing/automation. These helped my understanding of design in marketing greatly, as well as improved my time management skills.

How has the COVID-19 pandemic affected your day-to-day, and what challenges have you faced as a student?

Online learning and the transfer to the online structure has been particularly challenging during this time. Online school is an entirely different beast. Scheduling seems more flexible but between keeping up with everything at home (work, school, clubs, social life), Zoom fatigue hits hard and you have to keep a strict schedule to keep up.

What advice would you give to high school students looking for a successful career in the local software industry?

Be assertive! You don’t know what you don’t know, so reach out to the people who do. Talk to a high school counselor or someone knowledgeable about job opportunities, interview skills, resume reviews, and industry knowledge. Networking can be a gamechanger; go out and email or connect on LinkedIn/social media with industry professionals as you look for advice or job openings. Chase after job opportunities, even the ones you think you won’t get because you never know where you’ll get your foot in the door. Even if you don’t get the job after the interview, that’s a great practice. And don’t be afraid to leave a job if the work environment is toxic.

Learn more about Advancing San Diego and our internship program.

Company contact info and additional information:

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Advancing San Diego Company Spotlight: Traits AI

The Advancing San Diego (ASD) Internship Program launched this Spring in a remote-capacity amid the COVID-19 pandemic and aims to provide up to 100 San Diego-based companies with fully subsidized interns. This program targets companies with 100 employees or less, which comprise 98 percent of all businesses in San Diego, employ nearly two thirds of San Diegans, and account for 70 percent of job growth. A key issue for these companies has been a lack of time and resources to recruit the skilled talent necessary to continue their growth.

As students close out their Summer internship experiences, EDC has launched this blog series to highlight the innovative local companies that comprise the first cohort of the program, and the interns they hosted.

In this feature, we sat down with Brandon Bosse, Founder and CEO at Traits AI, Inc. A part of the inaugural cohort of host companies, Traits AI is a San Diego-based software company that creates animated artificial intelligence (AI) avatars that you can talk to, like you talk to Siri or Alexa. The company develops Alexa Skills, Google Assistant Actions, and chatbots for clients to help them better serve their customers; but its particular area of focus is on AI avatars that put a face to the voice using an animated avatar that looks like and sounds like the person they represent to help them extend their reach.

People are busy, especially those in in-demand professions like law, healthcare, consulting, and more. In these fields, there’s often only one point-person, but thousands of people who want a little bit of their time. While we cannot duplicate or replace those professionals, Traits AI can extend their reach by automating some of the repetitive parts of what they do on a daily basis. This frees them up to spend more time on things that require their unique skill set and expertise.

Read on for more from Traits AI founder Brandon Bosse.

Why was your company founded, and what are your current points of focus?  

You know that annoying feeling you get when you ask Siri or Alexa a question and she completely gets it wrong and has no idea what you just said? Yeah, we get annoyed by that, too! That is the underlying problem we fell in love with and seek to solve: people need better, more instant access to information. Of course the nuances of language are incredibly challenging to understand even for us people and, so far, understanding complex language is also beyond what AI models can do. That’s why we turned to crowd-sourcing responses as a stepping stone approach until natural language models like GPT-3 are able to grasp the nuances of language.

Our main point of focus now is on establishing product-market-fit to help in raising a pre-seed funding round. Most investors aren’t aware of the budding field of synthetic media and recent advances in China, New Zealand, and Canada, and it is our job to help demonstrate how AI avatars can be a benefit to modern society.

Tell us about your experience building a startup in San Diego. 

San Diego is an amazing place to start a tech company because it attracts so many brilliant people and has a thriving startup scene.

For example, in 2017, I joined the fall cohort of The Founder Institute, which was instrumental in getting Traits AI up and off the ground. Through networking with fellow graduates, I learned about the Small Business Development Center and The Brink where I have received mentorship and support, including connection to the ASD Internship Program. For the past two years, I have volunteered at the registration desk of San Diego Startup Week and have met some really amazing people!

There are also fun community events and meetup groups that have been a great way to socialize and meet other people interested in entrepreneurship, AI, and tech. I’ve enjoyed attending Triton Entrepreneur Night where I got to see how great pitching is done! And I’ve met some really smart and amazing people at The Machine Learning Society and The San Diego Machine Learning Meetup Group.

Has your company pivoted as a result of COVID-19?  

Yes, in March 2020 we began working on a new AI avatar/chatbot named Vita to help people with advanced care planning, like filling out an advanced directive. Since patients with COVID-19 are typically in isolation, having an AI avatar help them navigate their healthcare choices makes sense so that healthcare staff aren’t exposed any longer than necessary. Vita is able to take as long as the patient needs to talk about and answer questions related to advanced care planning.

Tell us a little bit about your interns and the value they bring.

We have been lucky enough to work with four interns through the program and they have all brought their own unique talents to the team. Their education in programming, web development, social media, and creative writing have helped the company advance toward our goals. I have found them to be professional, responsible, and hardworking even during this time of remote work and I am grateful to have them on the team.

In your opinion, what is special about San Diego’s science and technology community, and the talent that drives it?

California has always been the land of dreamers—people who dare to DREAM BIG and make their dreams come true. It also attracts open-minded, outside-the-box thinkers who don’t always fit into mainstream society. I see many dreamers, open-minded, outside-the-box thinkers in San Diego and THAT is what makes it a great science and tech community.

I think Steve Jobs put it best when he said, “Here’s to the crazy ones, the misfits, the rebels, the troublemakers, the round pegs in the square holes…the ones who see things differently—they’re not fond of rules, and they have no respect for the status quo… You can quote them, disagree with them, glorify or vilify them, but the only thing you can’t do is ignore them because they change things… They push the human race forward, and while some may see them as the crazy ones, we see genius, because the people who are crazy enough to think that they can change the world, are the ones who do.”

Learn more about Advancing San Diego and our internship program.

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Advancing San Diego Intern Spotlight: Paul Krupski, Perspectium

The Advancing San Diego (ASD) Internship Program launched this Spring in a remote-capacity amid the COVID-19 pandemic and aims to provide up to 100 San Diego-based companies with fully subsidized interns. This program targets small businesses with 100 employees or less, which comprise 98 percent of all businesses in San Diego, employ nearly two thirds of San Diegans, and account for 70 percent of job growth. A key issue for these companies has been a lack of time and resources to recruit the skilled talent necessary to continue their growth.

As students close out their Summer internship experiences, EDC has launched this blog series to highlight the innovative local companies that comprise the first cohort of the program, and the interns they hosted.

In this feature, we sat down with Paul Krupski, ASD software intern at Perspectium. A part of the inaugural cohort of host companies, San Diego-based, minority-owned SaaS company Perspectium was founded in 2013 by David Loo, the founding developer of ServiceNow. The company now also has offices in San Jose, New York, and London.

Paul, start by telling us a little about yourself.

I transferred from Oceanside-based MiraCosta Community College to Brown University where I’ll be finishing my degree in computer science with a focus in artificial intelligence and a minor in finance. In the professional world, I hope to work in the fintech sector applying the latest technologies to the financial industry. Interning at Perspectium gave me a firsthand look at how third party tech companies can offer SaaS to companies of all industries, saving them time and money by handling their informational needs. I hope to take what I’ve learned through this internship and use it towards my future of applying computer science to finance.

How has your experience in the ASD Internship Program been, and what projects/assignments have been the most meaningful?

I have had a very positive experience while participating in the ASD Internship Program. The most meaningful projects that I completed while working at Perspectium were instances where I would be directly interacting with several data bases to send and receive information from a web application.

How has the COVID-19 pandemic affected your day-to-day, and what challenges have you faced as a student?

COVID-19 has affected my routine as a student by causing my semester at Brown to be completely online. Although this has been a challenge, I’ve been fortunate in that it has not hindered my ability to plan my academic goals and advance forward to my future career.

What advice would you give to high school students looking for a successful career in the local software industry?

Be an active learner both in computer science and professional etiquette. Be sure to research and practice for the interviewing process.

Get in touch with Perspectium:

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Advancing San Diego Company Spotlight: Family Proud

The Advancing San Diego (ASD) Internship Program launched this Spring in a remote-capacity amid the COVID-19 pandemic and aims to provide up to 100 San Diego-based companies with fully subsidized interns. This program targets companies with 100 employees or less, which comprise 98 percent of all businesses in San Diego, employ nearly two thirds of San Diegans, and account for 70 percent of job growth. A key issue for these companies has been a lack of time and resources to recruit the skilled talent necessary to continue their growth.

As students close out their Summer internship experiences, EDC has launched this blog series to highlight the innovative local companies that comprise the first cohort of the program, and the interns they hosted.

In this feature, we sat down with Jaden Risner, CEO and Co-Founder at Family Proud. A part of the inaugural cohort of host companies, Family Proud is a San Diego-based, Veteran-owned and operated company that provides a care management platform which connects patients and families to a community and resources critical to their care, in a time of need.

The platform is secure and easy-to-use, and allows families to communicate to their support network, receive support through our care registry, and communicate with others in similar situations through our peer network. Family Proud provides a foundation for families to receive support and love, and enhance care for their loved one.

Why was your company founded?  

Family Proud started from a place of love. Our mission has always been to ensure no family need goes unmet and that’s why every day we strive to help as many people as possible with all the love we have to give.

Family Proud is inspired by both co-founders’ personal experiences. I spent 12 years of active duty with the Navy as a helicopter pilot. On one of my deployments, my mother had a heart attack and I was confronted with the struggles of remote care. Several deployments later, my father was diagnosed with cancer. I ended up becoming my mother’s informal caretaker and have personally experienced the burdens of care.

My co-founder Clay was a USMC staff sergeant and was diagnosed with cancer in April 2008. Four months later, after undergoing chemotherapy, Clay’s cancer went into remission. But when his cancer came back a year later, and he was given six months to live, the 13-year Marine Corps veteran set a new goal, the Iron Man. A clinical trial at UC San Diego is ultimately what saved his life, and he went on to compete in the Ironman World Championship triathlon in Hawaii in 2010 shortly after his terminal cancer discharge. Clay committed himself back to patient care, became a patient advocate, and went back to school. Clay is now a healthcare executive and Family Proud’s Chief Strategy Officer.

Tell us about your experience building a small business/startup in San Diego. What resources, services, and/or organizations were most valuable for supporting your Family Proud’s growth?

San Diego has a great startup ecosystem. From academia to events and coworking spaces, Family Proud has been fortunate to lean on the community to support our early growth. The ASD Internship Program is an example of the collaborative support available in San Diego—working together to support innovation, development, and growth for the greater San Diego economy.

Has your company pivoted as a result of COVID-19?  

Although our initial market focus was on the pediatric cancer and Veteran communities within the San Diego region, COVID-19 has opened our service aperture to a far greater audience in need. For example, to broaden our impact, we rolled out our “Digital Care Kit” program—a custom PDF e-package consisting of care registry credit, relevant resources, products, services, lessons learned, and peer connections based on the recipient’s location and adversity. Family Proud vets families in need and connects them with a care kit, which has been sponsored by a generous donor. To request or sponsor a Family Proud Digital Care Kit, please visit our website.

Tell us a little bit about your interns and the value they bring.

As a small business in San Diego, we’ve been fortunate to receive consistent news/opportunities from the City and EDC newsletters. The timing of the launch of the ASD Internship Program happened to coincide with our product development schedule. Our software developer intern, Shaeli, was an amazing addition to the technology team. She brought a fresh, outside-the-box perspective, was resilient and flexible to the new virtual/remote collaborative environment, and always approached her weekly tech sprint challenges with a positive and determined attitude. Family Proud was very lucky to have Shaeli onboard with us this Summer!

Company contact info:

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