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The Big Picture San Diego Blog


Big Picture San Diego Blog

February 28, 2017

Every quarter, San Diego Regional EDC analyzes key economic indicators that are important to understanding the region's standing relative to the 25 most populous metropolitan areas in the U.S. 
 
The Economic Snapshot covers data from October to December 2016 (Q4), the most recent quarter available, in regard to employment, real estate and venture capital. 
 
Highlights include:
  • The San Diego region had the 14th lowest unemployment rate amongst the top 25 metros. This ranking is down four spots from Q2 2016.
  • The region’s unemployment rate of 4.2 percent continues to be lower than the national and state rates of 4.5 and 5.0 percent, respectively.
  • The region’s unemployment rate decreased by 0.5 percentage points between Q3 and Q4 2016, the 9th largest decrease among major metros.
  • Year-over-year, the region has added 28,900 jobs - a 2.0 percent increase.
  • With the exception of manufacturing, all of the region’s sectors experienced year-over-year growth. Leading the way was real estate and rental leasing which increased by 6.1 percent or 1,700 jobs.
  • The largest venture capital investments were in disease diagnosis, internet software and services and biotechnology companies. The top two deals accounted for 44.1 percent of the region’s total investment for the quarter, or $79 million.

Check out the full Quarterly Economic Snapshot here.

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February 22, 2017
The largest city in the state of Baja California, Tijuana sits at one of busiest land border crossings in the world. Together with San Diego, Tijuana is part of a dynamic cross-border metropolis where deep economic and cultural linkages result in the creation of value, jobs and exports. The unique dynamics of this mega-region provide local companies with an important comparative advantage in the global economy. Since April 2016, EDC has participated in a greater initiative to streamline cross-border economic development efforts by refining our approach to servicing corporate retention, expansion and attraction interests. This “bilateral cities exchange” called for a deeper understanding of Tijuana’s economy as a critical component of economic growth throughout the region. 
 
As such, EDC partnered with UC San Diego’s Center for US-Mexican Studies to create an economic overview of Tijuana – a seven-page document that provides a data-driven summary of Tijuana’s economic drivers, talent, quality of life, global connectivity and cost. This resource will help inform clients and partners of Tijuana’s diversifying economy while touching on the unique benefits of doing business in our binational mega-region.
 
Highlights include:
  • Economy: Tijuana is a medical device manufacturing powerhouse; 97 companies employ 21,000 workers who produced $600M worth of product in 2014. 
  • In 2015, Tijuana graduated more than 8,000 university-level students – 29 percent of which received STEM degrees.
  • Tijuana ranked #8 on the New York Times' 2017 list of must-visit destinations around the world.
  • Between 2012 and 2016, FDI in Baja totaled $5.6 billion – 63 percent of which came from the U.S. Other sources of FDI include South Korea, the Netherlands, Japan and Spain.
  • When compared to China, Mexico is estimated to have 13 percent lower labor costs and an overall average direct manufacturing cost that is four percentage points cheaper than China. 
 
Read the Tijuana Regional Profile here.
February 17, 2017

Like CES for maritime… San Diego welcomed the world's leading marine science and ocean technology exhibition and conference this week. Oceanology International (OI) – launched in London in 1969 – kicked off its first North American conference at the San Diego Convention Center, bringing together more than 1,500 attendees and 150 maritime technology companies from more than 13 countries. Led by The Maritime Alliance and with the support of EDC, OI will be a biennial event in San Diego, switching to London in off-years.
 
The tradeshow connected companies and consumers from across the world, and served to help improve strategies for developing, protecting and operating in the world’s oceans.
 
Why San Diego?
With 70 miles of coastline, a concentrated military presence and innovation-driven technology companies, San Diego has emerged as a hub for maritime technology. Driving this point home, local companies large and small set up shop at Oceanology International North America – from Ocean Aero with its unmanned surface and underwater vehicles to SonTek with its underwater sensors, or Planck Aerosystems that can land an aerial drone autonomously on a moving vessel. Attendees got first-hand access to current and impending innovation in maritime and bluetech.
 
February 16, 2017

Content pulled from a piece in the San Diego Business JournalVAVi Faced Its Own Obstacle Course
 
EDC investor and recreational sporting events organizer VAVi Sport & Social Club was looking to make a big splash at its first major international competition: a 20,000-person obstacle course and race in Sydney, Australia. Little did VAVi know its shipment of inflatable obstacles would present its own set of obstacles.  
 
The company loaded its $1 million worth of goods into shipping containers, set to arrive a month before the event. Complications arose in South Korea when VAVi’s equipment was unloaded and seemingly forgotten about on storage docks. This is when EDC came in… 
 
Having been a part of the 2015 global export assistance program MetroConnect, VAVi CEO Steve Stoloff called on EDC and the organization’s World Trade Center team to leverage its international network for support. EDC staff contacted the U.S. Commercial Service – the trade promotion arm of the U.S. Department of Commerce – to ensure the forgotten equipment would be loaded onto another boat bound for Australia. Staff also reached out to contacts in Sydney to coordinate on-the-ground transportation from Brisbane to Sydney, since this new boat would no longer be porting in Sydney. 
 
And it didn’t stop there. EDC’s board of directors stepped up to the challenge. Helping recover some of the money lost in the fuss, Linde Hotchkiss, managing partner at the global risk advisory and insurance solutions firm Willis Towers Watson, counseled VAVi on the qualms of international shipping and helped facilitate an insurance claim.
 
With all hands on deck, VAVi received its shipment and salvaged the prominent event – saving one-fifth of the company’s yearly projected sales. This is not simply a company story of overcoming obstacles in going global, but of the collaborative nature of San Diego’s business community. This is who San Diego is.
 
February 14, 2017
This weekend, years of hard work came to life for BAE Systems and partners across the state as the Barrio Logan-based shipyard cut the ribbon on its new dry dock, the Pride of California.
 
At 950 feet long and capable of lifting nearly 55,000 tons, the dry dock is the largest in California and the third largest in the nation. Used for ship repair and construction, the dry dock is flooded to allow watercraft to float in and then drained so watercraft can be set on a dry platform for work.
 
EDC board member and BAE Vice President Bob Koerber joined Congressman Scott Peters, Congressman Duncan Hunter, Port Chairman Robert “Dukie” Valderrama and an audience of more than 150 senior military personnel for the event inside the dry dock’s 100-foot walls. The dry dock was shipped across the Pacific Ocean on a 7,000 mile, 60-day journey. It represents approximately $100 million in infrastructure investment from BAE to increase the shipyard's capacity to meet the growing needs of the U.S. Navy.  
 
BAE currently employs 2,000 workers in San Diego, with the dry dock anticipated to add more jobs over the next several years. BAE is a critical pillar of San Diego’s working waterfront, where the shipbuilding and ship repair industry employs approximately 12,000 San Diegans and has an economic impact of $1.75 billion annually throughout the county.
 
EDC was proud to support this monumental engineering project by working directly with BAE to craft a competitive application for the Cal Competes Tax Credit program, which they ultimately won. Awarded in 2015, BAE's $1.55 million tax credit supports the shipyards ability to remain competitive and continue to invest in their yard and workforce. 
 
With the rebalance to the Pacific, the U.S. Navy’s presence in San Diego will continue to grow dramatically over the next several years. The challenges associated with this growth include the ability for local industry to service, build, upgrade and repair the equipment for the influx of U.S. Navy vessels. With President Trump calling for the Navy to increase its current fleet to 350 ships, San Diego will be on the receiving end of increased spending.
 
February 9, 2017

If you build it, they will come…”  This mantra was true of the Field of Dreams, and now of San Diego’s burgeoning tech ecosystem.

Together with 35 of San Diego's best and biggest tech companies, Innovate78 representatives joined the San Diego Venture Group's Tacos + Tech in Silicon Valley last week. The event – appropriately held at the Computer History Museum – played host to more than 700 curious Bay Area engineers and programmers, and served to showcase the high-tech jobs and opportunities available across San Diego.

With a special focus on attracting Bay Area engineers, North County companies like ViaSat, Thermo Fisher Scientific and Verve, as well as other San Diego companies like Illumina, Dexcom, ResMed, Qualcomm, Human Longevity, Cubic, Hired and LoanHero set up shop at the job fair-like event. Company recruiters spoke to San Diego as the alternative to Northern California’s congested traffic, high cost of living, hyper-competitive workforce culture and other issues plaguing the region.

As a proud sponsor, the EDC-led economic development initiative Innovate78 represented North County at a booth, with leaders from the five cities along the 78 Corridor – Carlsbad, Escondido, Oceanside, San Marcos and Vista – at the helm. Conversations with attendees ranged from North County housing costs to the growing tech sector, to the many breweries that make up the ‘Hops Highway’ – one of the primary booths highlighting the region's lifestyle.

While many attendees admitted connection to San Diego through family, school or dream vacations, it seemed as though the region’s tech ecosystem – which employs nearly 69,000 people – has flown under the radar. Tacos + Tech provided a platform for some of San Diego County’s top employers and innovators to attract Bay Area talent through simply sharing San Diego's reality: a broad diversity of career opportunity mixed with a top-tier quality of life (and, of course, tacos and beer). For decades, San Diego has built this ecosystem, and now…the talent will most certainly come.

Tacos + Tech comes on the heels of SDVG's Beachhead launch, a coworking space for San Diego entrepreneurs working out of Silicon Valley. 

January 30, 2017

By Nikia Clarke, executive director of WTC San Diego and Peter Cowhey, interim executive vice chancellor for Academic Affairs at UC San Diego
 
During his first week in office President Trump made many bold moves, including an executive order to withdraw from the Trans-Pacific Partnership (TPP), a call to renegotiate NAFTA, and a threat to impose a 20 percent border tax on Mexican imports to the United States following a very public spat with Mexican President Enrique Peña Nieto. 
 
Trade matters for economies, big and small. For a border city on the edge of the Pacific, decisions on trade policy in Washington have outsized impacts on jobs, growth and opportunities for San Diegans. 
 
Take TPP — an international trade deal originally negotiated between the U.S. and 11 other countries, covering 40 percent of global GDP
 
Right now, the status quo makes it more expensive for U.S. companies to export to other countries than it is for foreign companies to sell goods and services here. TPP sought to level the playing field, especially for the small and midsize companies that make up more than 95 percent of San Diego’s business ecosystem. 
 
It also was the first trade deal to write the rule book for the economy of the future. It protected the intellectual property of American innovators, which matters when you live in the third most patent-intensive region in the world.
 
Scientific research and development, the heartbeat of our world-renowned life sciences ecosystem and an industry dependent on patents, is five times more concentrated here than in the U.S. as a whole. 
 
TPP eased restrictions on the movement of data and services across borders, which is important when you have a globally competitive cybersecurity cluster and revolutionary big data and genomics industries.
 
In San Diego, innovation is our livelihood, and TPP would have been a game changer for all those San Diego companies that export their knowledge across the globe. Killing TPP effectively cedes leadership on trade rules and norms to China, an outcome that is unlikely to be advantageous for U.S. companies and consumers.
 
And don’t forget that 97 percent of our goods exports — primarily high-value manufactured goods worth over $22 billion — are already sold in TPP markets, employing over 120,000 San Diegans. Most of those goods are exported to Mexico, sometimes crossing the border several times before they are fully assembled. This means that 40 percent of the content of imports from Mexico — the ones subject to a potential 20 percent tax — is American-made.
 
As we pivot from what could have been with TPP and look to NAFTA renegotiation, to building a wall, to a looming trade conflict with China, we should remember that trade has always been an American reality. 
 
Here in San Diego, we marvel at the transformation over the past 50 years from a sleepy Navy town to a global city that develops life-changing technologies. We didn’t get here by building walls, and we won’t get ahead that way either. 
 
 
This op-ed originally ran in the San Diego Union-Tribune: "Trump's trade moves impact San Diego economy"

For more more on TPP and San Diego, see WTCSD's economic impact report.

January 24, 2017

A 295,000 square foot addition to your home may not be on most people’s minds, but for a company with Illumina’s ambition, its par for the course. And today was yet another one of those days at one of San Diego’s largest life sciences companies. It also marked the culmination of a dynamic collaborative partnership to get things done.

Cutting the ribbon on the new addition to its corporate headquarters, Illumina President and CEO Francis deSouza, Executive Chairman Jay Flatley and other Illumina executives shared the stage with San Diego Mayor Faulconer to announce the opening of what is now among San Diego’s top five largest manufacturing centers. And yes, manufacturing in San Diego does include this genomics giant.  

The state of the art facility will house 850 new R&D, oncology, reproductive and genetic health and manufacturing jobs. It will continue to fuel Illumina’s majority share of the world’s genetic sequencing market, producing both the sequencing machines and analytics its customers need to support innovative global healthcare applications.

EDC is proud to have been able to contribute toward making the new building a reality. Countless phone calls, meetings and exchanges alongside our partners at Alexandria Real Estate, Biocom, Cushman & Wakefield and the city of San Diego brokered the arrangement. After four years of collaborative work, led by California Assemblymember Todd Gloria and San Diego Mayor Faulconer, the art of the possible (that new home addition) is today a shiny, ambitious new reality for San Diego.

Next up for the company and San Diego – Another 316,000 square foot addition due to open this July. 

 

January 20, 2017

Understanding our economy begins with strong data – it’s a phrase people hear us say a lot at San Diego Regional EDC, and for good reason. 
 
Unemployment data, while important, only gives us a piece of the puzzle and many people are still curious as to how it all relates to them...as a business…as a job seeker…and as a San Diego resident.
 
As we kick off 2017, we want to provide comprehensive research that tells a story about our economy. San Diego's Economic Pulse, our new research product launching today, is our way of doing that. In addition to  tracking unemployment, we will also be keeping tabs on new business establishments, job postings and looking at who’s hiring in San Diego.
 
This research wouldn’t be possible without the generous support of EDC board officer Phil Blair and Manpower San Diego.
 
Throughout the year, you will continue to see changes in the way we present our research and talk about data. We would love to hear your thoughts. Join the conversation at @SDregionalEDC or send an email to research@sandiegobusiness.org.
 
January 20, 2017

From 2025 to 2050, the 65-and-older population is projected to almost double to 1.6 billion globally, whereas the total population will grow by just 34 percent over the same period. With this, it has become increasingly important to support our aging population, with health and wellness among top priority.

San Diego medical technology company and 2016 MetroConnect participant AVACEN Medical has developed technology to help ease some of the common ailments afflicting seniors. The AVACEN 100 is an FDA cleared, over-the-counter medical device that provides non-invasive, temporary arthritis and muscle pain relief, and muscle relaxation. Using microcirculation enhancement on the palms, the locally-made device helps warm and thin the blood, thereby dissipating heat throughout deep tissues and relieving joint pain associated by arthritis, muscle spasms, sprains and more.

Taking this San Diego-made technology global, the AVACEN 100 has just received the CE (Conformité Européenne) Mark approval to treat widespread pain associated with fibromyalgia. The CE Mark allows AVACEN to market its AVACEN 100 to the European Union's 28 member countries where many prescription drugs, available in the U.S., have been rejected by regulatory officials for treating fibromyalgia pain.

Founded by Tom Muehlbauer in 2009, AVACEN’s revolutionary technology was originally developed to help alleviate his sister-in-law’s chronic pain. The company currently sells in two countries, with plans to expand into 10 more over the next year (thanks in part to the CE Mark). Sales have climbed to more than $1.5 million, with more than 20 percent of the sales coming from international markets.