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Economic Development 101

October 15, 2013

Economic snapshot graph

EDC’s economic snapshot shows that San Diego’s economy is gaining steam. From April 2013 to July 2013, the San Diego region added 13,000 private sector jobs. Although the metro’s unemployment rate still stands slightly above the national average, San Diego experienced one of the largest year-over-year declines in the U.S. from July 2012 to July 2013. Only four major U.S. metros – Seattle, Tampa, Detroit and Riverside - experienced a greater decline over that period.

Here’s how the numbers in the snapshot broke down:

  •  Private businesses added approximately 13,000 jobs in the quarter. Hospitality and tourism added the highest number of jobs this quarter, with 7,600. Construction industry added 4,100 jobs in the quarter, which is likely due to many major construction projects ramping up in the summer season. With the recently-approved expansion of the San Diego Convention Center (not included in these numbers), the region will add nearly 7,000 hospitality and tourism jobs and 3,000 construction jobs in a future quarter.
  •  This quarter, the snapshot took a closer look at the Sports and Active Lifestyle industry, based on a report that was recently released. With companies including Taylormade, Sector 9 and other well-known products, San Diego is a designated leader in this important sector. The report found that the industry’s economic impact is equivalent to hosting four Super Bowls annually.
  • San Diego’s foreclosure rate remained lower than the U.S. average in July2013, with only 2.31 out of every 10,000 homes foreclosed during that month
  • All major metros nationwide experienced positive growth in home prices over the quarter and the year, a symptom of the resurging US real estate market. From Q1 2013 to Q22013, home prices grew about 13.7 percent  in the San Diego region.

The quarterly snapshot reports on key economic metrics that are important to understanding the regional economy and San Diego's standing relative to other major metropolitan areas in the U.S. The snapshot only reported on data through Q2 2013. Amidst the current government shutdown, we can only hope that there’s data next quarter to produce a new snapshot.

You can find the complete snapshot here.

The economic snapshot was made possible by Chase Chase Logo
October 4, 2013



Every San Diego company has a unique story to tell. That became very apparent as the region came together to celebrate MFG Day at San Diego City College on Friday. Four panelists representing a diversity of San Diego companies talked about the challenges and opportunities facing the region’s manufacturing sector, which employs more than 90,000 individuals.

Take D&K Engineering, a high-tech manufacturer.  When the entrepreneurs who created EcoATM were looking to make their idea a reality, they went to the Rancho Bernardo firm to create an e-recycling kiosk. As a result, D&K Engineering had to scale up its production and hire more employees. And they chose to do it in San Diego. “Access to talent and the border opportunities are one of the main reasons I chose to start D&K in San Diego. Besides, who wouldn’t want to live here?” said Alex Kunczynski, one of the company’s founders.

The border also adds a significant competitive advantage for local manufacturers. As Interim Mayor Todd Gloria said in his opening remarks, “this is a big deal.” San Diego and Tijuana are currently working together like never before. When asked about why Taylor Guitars chose to open up a manufacturing facility across the border in Tecate, VP of Manufacturing Chris Wellons said “We have a saying at Taylor Guitars. We say ‘We’ll we be happy we did this in 10 years.’” And happy they are. Manufacturing in Mexico, as opposed to China or somewhere else overseas, has given Taylor more control over its finished product. It’s also become more cost competitive.

Wellons alluded to the entrepreneurial spirit of another panelist. Stephan Aarstol started Tower Paddle Boards - a sports and active lifestyle company - in 2010. With a little help from ABC’s “Shark Tank,”he transformed his sales from $3,000 in 2010 to $3 million in 2013.  Although he only has four employees in San Diego, he plans on growing in the coming years, and he’s looking to do it in the region. To him, he’s not just selling a paddleboard but also exporting California culture to consumers all over the globe.

As Chris Wellons of Taylor Guitars echoed, keeping manufacturing jobs close to home really comes down to innovating the process. Taylor Guitars has more than 700 employees, with many of them working out of its El Cajon headquarters. Although customers can still rely on the same quality that made Taylor a household name when it was founded in 1974, the manufacturing process has evolved. Taylor used to carve each of its guitar necks out of an individual piece of mahogany, meaning 60 – 70 percent of the materials were wasted. In 1999, Taylor decided that process needed to change. The result was one of the greatest guitar innovations in the past 100 years.  Instead of using a one-piece neck, Taylor switched to a three-piece neck, which resulted in a 66 percent yield in materials and created a more sustainable product. This, Wellons said, was possible because of the ability to execute a vision, which he thinks is a strength of San Diego.

So what can San Diego do to continue incubating manufacturing?

The answer may be easier said than done. San Diego is fortunate enough to have a highly-educated workforce. The metro currently ranks fourth in the U.S. for Ph.D. attainment rates.  Although Ph.D.-trained workers are essential for many San Diego sectors, as the panelists noted, it’s not necessarily these types of jobs they have trouble filling, but the machinist jobs where workers require hands-on manufacturing skills.

Wellons learned these skills in his high school shop class, and so did many other highly-skilled manufacturers. Admittedly, we focus a lot of time on retaining and incubating high-tech talent, but as Interim Mayor Gloria pointed out “These jobs are important too. They provide a comfortable middle-class life.” San Diego City College provided the perfect backdrop to get this conversation going. As San Diego Community College District Trustee Peter Zschiesche noted, 98 percent of San Diego City College grads remain in San Diego. 

With the guidance of San Diego Community College District and organizations like San Diego Workforce Partnership, San Diego – and it’s nearly 2,800 manufacturers – are looking to put these grads to work.

Of course, this all starts with the conversation we had this morning. A conversation that I’d bet we’ll be happy we had in 10 years.

Please check out for a list of local companies that held tours today,

Media Coverage: 

KPBS, Taylor Guitars still strumming along as example of San Diego manufacturing success

U-T, S.D. county product makers open doors to public


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September 23, 2013

The expansion of the San Diego Convention Center has been front and center across the region, with everybody from sports fans to politicians expressing their views on the project.  With years of legwork done on the expansion’s behalf, the planned contiguous expansion promises to be a waterfront asset with public space as its focal point. When complete, the expanded San Diego Convention Center will create $700 million in economic impact and $13 million in additional hotel tax revenue.

Of course, keeping the Chargers in San Diego is a priority, but this is not seen as an either-or situation. San Diego can have a world-class convention center and a world-class football stadium. It would be a service to our economy and community to have both. The majority of San Diegans have worked hard to get to a place where we’re on the same page about the fate of the contiguous expansion. We need to move forward now. We need to show potential conference visitors and the rest of the world what we already know: San Diego is a great place to live and work.

For starters, we can take a look at the medical conventions hosted at the San Diego Convention Center. With six medical conventions slated for Fall 2013, the industry brings a reported $293.3 million in economic impact. Hands down, Comic-Con has the largest economic impact of any conference in San Diego. As Convention Center expansion proponents note, it is essential not only for economic impact, but also for maintaining the region’s cultural foothold. However, the Society for Neuroscience will bring 32,000 attendees and generate more than $131.9 million in economic impact. That’s nearly 75 percent of Comic-Con’s impact, with only a quarter of the number of attendees. Compounded with the region’s strong life sciences research – thanks to Sanford Burnham and others - and strong healthcare facilities, it would be hard to argue that these are not the exact type of people we want to attract to the region. Conferences are one way to get them here and we cannot delay the process any longer.

Every year, there is a plethora of conferences that San Diego cannot host simply because we do not have the capacity.  Our convention center business is already booming, but as conference organizers continuously expand, we cannot rest on our laurels any longer that our nice weather will bring people here. Yes, it helps but we need the capacity. The airport’s new Green Build just added 10 additional gates and numerous commercial opportunities. The expanded San Diego Central Library is slated to open next week. Now the convention center needs to follow suit.

Build it and they – the talent, the conferences, the investors -will come.

Now we’ll let the infographic do the rest of the talking


July 29, 2013

Aerospace is part of a large and thriving Aerospace, Navigation & Maritime Technologies (ANMT) cluster in San Diego. Among the 25 most populous U.S. metropolitan areas, San Diego ranks second in the concentration of ANMT employment behind longtime aerospace leader Seattle.

 The cluster accounts for more than 20 percent of San Diego’s innovation economy, more than any other cluster except Information and Communication Technologies. San Diego’s growing unmanned aerial systems (UAS) sector presents a unique opportunity for companies in the Aerospace industry, with cutting-edge applications being developed in San Diego and throughout California. Currently, 60 percent of U.S. technology development in unmanned systems is performed in San Diego County, according to National University System Institute for Policy Research. With the rise in commercial and consumer uses, this industry sector is well positioned to carry the aerospace industry forward and continue to attract top engineering talent to the region.

  Since the aerospace industry shares many components with other industries in the ANMT cluster, it is difficult to break down aerospace companies and employment from the rest of the cluster. Some of the key aerospace-specific components of the cluster include: Search, Detection, Navigation and Guidance; Aeronautical and Nautical System and Instrument Manufacturing; Aircraft Manufacturing including Aircraft Engine and Engine Parts Manufacturing; and Guided Missile and Space Vehicle Manufacturing. San Diego Regional EDC analyzes key economic metrics that are important to understanding the regional economy and San Diego's standing relative to other major metropolitan areas in the U.S. For more information about San Diego’s aerospace industry and the full run down on how San Diego is faring compared to other major metropolitan regions, see the July 2013 Economic Snapshot.




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July 2, 2013

San Diego Venture Group Cool CompaniesIn 2012, the San Diego region raked in upwards of $1.1 billion in venture funding, beating Texas, Colorado, the DC Metroplex and other locales. At the San Diego Venture Group’s Annual Venture Summit on July 12, participants will be able to interact with more than 120 VCs and 30 “cool” companies.

The Venture Summit is one of the most popular events produced by SDVG and connects numerous top entrepreneurs from the region with many investors from Southern California, the Bay Area and other areas to showcase how the innovation climate thrives in San Diego. The Summit will feature a keynote by Gwynne Shotwell, president and COO of SpaceX, as well as other San Diego innovators including Chris Anderson (3D Robotics), Dr. James Mault (Qualcomm Life) and Larry Stambaugh (San Diego Zoo Bioinspiration Centre.)

For the second year in a row, the Venture Summit will include 30 San Diego “Cool Companies.” From social media to software and algae biofuels, companies making this year’s roster include Roambi, Sapphire Energy, and Embarke. They are indicative of the dynamic industries that fuel San Diego’s innovation economy.

Venture Summit is not the only venture-related activity that’s happening in San Diego on July 12. On that day, companies from around the globe will hand in WBT logotheir submissions to present at WBT Innovation Marketplace. Now in its 11th year, WBT Innovation Marketplace brings together the largest collection of vetted and mentored companies and technologies emanating from top universities, labs, research institutions, and the private sector. More than 10 years of research shows that one in three WBT presenters goes on to license, secure venture funding, or sell their IP outright. Last year, the show moved from Arlington, Texas to San Diego, so it could benefit from the region’s world-class talent pool and strong venture capital community.

Companies are invited to apply to present at the Oct. 22 showcase.

With all of the venture activity going on throughout the region, it’s no wonder San Diego has been identified as a high-tech challenger to Silicon Valley.

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June 27, 2013

He ought to say "Move over Jon Stewart." Beaulieu had an EDC audience laughing about economic forecasting. Not exactly an easy thing to do. Humor aside, Beaulieu - who serves as principal at ITR Economics - has an impressive record of accurate forecasts - 96.2 percent accuracy looking 12 months into the future. In a fast-paced and animated presentation, Beaulieu gave the crowd what they came for: actionable information about the coming year. He says while GDP has been growing at a tepid pace in 2013 there will be a slowdown in 2014 as industrial production slows. He cautioned not to project 2013 growth rates into 2014. "Focus on efficiencies, training and outsourcing," he said. And as the country grows toward energy independence, Beaulieu sees an increase in manufacturing in the U.S. Longer-term he looks for good years in 2015 – 2018. However, according to Beaulieu’s research, this will be followed by a noticeable recession in 2019.

"The U.S. is fundamentally healthy," he said. "There's more upside than things to worry about." He pointed out that California maps to the U.S. in terms of trends.

Beaulieu mentioned a list of problems including Europe’s financial stability, China’s slowing growth rate and sequestration. But he parried these with quick explanations. Germany and France are committed to the European Union and will exert a strong influence on policy. China will not melt down; the new leadership is taking a longer view and is letting growth slow down as the government sets up for economic stability. Using a chart to contrast projected spending before and after sequestration, Beaulieu made it clear that the delta between the two is small compared to overall spending.

The presentation included some very positive observations about Mexico’s economy. “Their manufacturing index is up, they are producing better goods, and their management is national now – not ex-pat,” Beaulieu said, at one point calling it “Canada to the South.”

You can check out Alan's presentation here.



June 19, 2013
EDC dashbaordEDC has set out to chart the health of the regional economy through our new dashboard. Statistics on the economy can often be confusing, and are rarely packaged together in one place. We’ve sorted through data from the Bureau of Labor Statistics, Bureau of Economic Analysis, PriceWaterhouseCoopers, International Trade Administration and others to find the most compelling and indicative statistics on the San Diego economy. Using simple design principles, the dashboard is our one-stop shop for quick, at-a-glance data about our regional economy.
The dashboard provides baseline indicators on 20 different metrics to track the region’s standing among the 25 most populous U.S. metropolitan areas. They range from conventional economic indicators, such as unemployment rate and Gross Domestic Product, to less familiar quality of life indicators, like sunshine hours. Along with our Economic Snapshot, launched earlier this quarter, this new comparison format helps us understand how San Diego stacks up with other major metropolitan areas across the nation. 
Although the indicators will more or less stay the same, the numbers will be updated as new data becomes available. 
Please contact if you have any ideas on how to improve the dashboard. 
May 21, 2013


Boxing analogies abound around San Diego. Media coverage about the release of the San Diego Metropolitan Export Initiative last week included a quote that San Diego is punching below its weight in exports. 
A few days later, EDC’s President and CEO Mark Cafferty is quoted saying about San Diego “We’re punching below our weight.”
The U-T profile, penned by John Wilkens, took a deep dive into life in San Diego and at EDC with Mark, exploring his goals for EDC and San Diego, and most importantly, how he views the region:
“When you are speaking economically, San Diego has a lot of great things that happen here that are either in the shadow of other places when I don’t think they need to be, or the laid-back persona starts to cross over into places where I think we need to project a little stronger and bigger and smarter.”
With Mark’s guidance, EDC has strengthened its focus on economic development with the goal of creating jobs and maximizing the region’s economic prosperity and global competitiveness. 
Read the complete profile:
May 16, 2013

At EDC, we're always looking for new ways to tell San Diego's unique story. With the release of the Brookings Metropolitan Export Initiative was a good time to try it out. Using Storify, we integrated pictures, tweets, quotes and other forms of media from the event. Here's what we came up with:


Help us keep the conversation about the critical role exports can play in the region's global competitiveness strategy 

April 22, 2013


The cornerstone of a successful economic development program is having strong data to ensure that we are making informed decisions about growing the economy. At EDC, we have been fortunate enough to partner with and benefit from the countless area organizations, companies and universities that have provided substantial economic data. Although we don’t see these partnerships slowing down, with the launch of our new research bureau, we will be putting out a quarterly snapshot of our own. 
We’ve heard countless times that San Diego has a strong VC cluster, a healthy tourism industry, and a world-class talent pool, but as we strive to make our region globally competitive, we want to know how we stack up with other metro areas. Our Q1 snapshot is our data-driven approach to answering that question.
The quarterly snapshot will report on key economic metrics that are important to understanding the regional economy and San Diego's standing relative to other major metropolitan areas in the U.S. Please take a look, share with friend and colleagues, and let us know what you think.