Economic Prosperity - Regional Overview
A Region Reeling from the Recession
San Diego has been profoundly impacted by the economic recession gripping the entire nation, losing 70,000 jobs from 2008-2009. However, we have fared better than other regions in the state when considering the total change in employment over the last decade.
San Diego employment grew 3% in contrast to California’s 2% decline
Nevertheless, our economic future is in question. In San Diego and generally in the US, the decline of the manufacturing sector, once the foundation for secure middle income jobs, is partly responsible for our “hourglass economy” where job growth is concentrated in low or high income categories with disproportionally few middle income jobs. In the last ten years, San Diego’s pattern of job growth has shifted toward lower paying jobs. Since 2000, our region saw the number of leisure and hospitality jobs grow, while we lost higher and mid-paying jobs.
San Diego’s lopsided growth: low-paying service jobs grew while higher-paying manufacturing ones shrank.
If this trend continues, we risk switching from our current “hourglass economy,” to a “teardrop,” where the vast majority of our residents are working in the lowest-wage sectors such as restaurants and retail.
The Consequences of Lopsided Growth
A recent study conducted by the Center on Policy Initiatives indicates that 30% of San Diego County households don’t earn enough to live self-sufficiently. This puts pressure on the government safety net, and causes people to choose to live in less expensive areas, for example Riverside County or Baja California, Mexico, increasing commute times, traffic congestion and vehicle emissions. Income inequality contributes to a host of other social problems, including higher rates of violent crime, property crime, and teen births.
A sustainable economy offers a diversified mix of jobs to community members of all skills and backgrounds, enhances a community’s tax base, home and business ownership, and people’s sense of belonging and stake in their neighborhoods.
Our economic future hinges on whether we can create more high- and mid-wage jobs with benefits and job ladders in technology and other promising sectors.
Industry Clusters and a Clean Economy
Industry clusters are groupings of linked or related industries which have an employment or base that is greater than the national average, export proportionately more goods or services, and have strong multiplier effects within the economy. San Diego has strong clusters in telecommunications, biomedical /biosciences, software, electronics manufacturing, financial and business services, defense and space manufacturing, and cleantech.
Because of its link to the environment and quality of life issues, Equinox pays special attention to this latter cluster. San Diego’s world class education institutions and thriving life sciences and technology industries are collaborating with government and nonprofits to create a leading “cleantech” economy. Cleantech is the marriage of green/sustainable business practices and technology, where innovations use less materials or energy, generate less waste, and cause less environmental damage than the alternative.
Our region boasts over 800 cleantech companies focused on commercializing clean technology innovations in such areas as renewable energy (solar/wind power and biofuels), information technology, and green/electric transportation. According to CleanTECH San Diego, San Diego is poised to be a world leader in the clean technology economy.
Indeed, the percentage of new technology businesses has been increasing steadily over the past several years, from about 4% in 2007 to 8% in 2009. According to Connect, green technology start ups rank third behind two of our largest clusters, software and pharmaceuticals/biotech.
Of all the new technology jobs created in San Diego region in 2009, about 15% were focused on environmental services and technology.
Cleantech jobs tend to pay higher than
average wages and many of the jobs are service oriented (such as home energy
efficiency retrofits) and can’t be outsourced off shore. If the promise of this cluster is realized,
this will not only help create more well-paying jobs but also will have a
positive effect on our regional and global environment.
Equinox Center Priorities
Equinox Center will research and advance policies that support the growth of the clean economy, enhance quality of life so that we can attract and retain the best workforce possible, and help all residents in the region to become self-sufficient.
research and advance policies to ensure San Diego’s quality of life attracts
and retains the young, well-educated talent we need to grow our innovation
economy. San Diego did not rank among
the best cities in America for young adults in any of nine separate national reports. We want to help put San Diego on the map and
the top ten list. (For more on this, see our "Young & Restless" Resource Page.)
with local entities such as CleanTech, Connect, the EDC, Chambers of Commerce
and others to collect better data on San Diego’s clean economy, set targets and
identify policies that will attract clean tech businesses and green jobs to the
- Encourage the business community to take a leadership role in crafting a more economically and environmentally sustainable future for our region by continuing to highlight how local companies are using a “triple bottom line” approach to measure their success: the “3 P’s” – 1. Profits, 2. People, and 3. Planet. (Click here to view one of our recent profiles of local companies in our ongoing series The Bottom Line.)
- Brookings Institute Study-Sizing the Clean Economy: A National and Regional Green Jobs Assessment, 2011
- CleanTech San Diego
- Community and Economic Development Strategy,2002-2004, City of San Diego