Skip to Content


Research Blog

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. 
 
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 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 6, 2017

Now that the holidays are behind us, let’s take a look at some of the data. Early indicators point to another strong holiday shopping season in 2016, beating already lofty forecasts for retail sales1. San Diego’s employment grew by 12,100 in November, as retailers staffed up to meet the surge of shoppers2. But a lot of that hiring is seasonal, and these seasonal boosts are trending down. In fact, growth in retail trade employment has slowed dramatically over the past two years to a mere 0.1 percent.

 

Local employment in retail trade remains 2.8 percent below the pre-recession peak; 11 percent of regional unemployment comes from the industry3. This is because shoppers are increasingly turning to online retailers rather than brick and mortar stores – a trend that has continued to grow since the advent of e-commerce giants like Amazon.com (see chart below).

Traditional retailers are struggling to compete. Last week both Macy’s and Sears announced hundreds of store closures, which will bring thousands of layoffs across the U.S. In San Diego, Macy’s apparel store in Mission Valley will be shutting its doors, leaving 140 people without jobs4.

Changes in technology have had a profound impact on the economy and the composition of jobs. And while the tech boom has brought about gains in productivity, e-commerce and automation are displacing retail workers. These are jobs that are mostly held by women, and where more than half are held by people under the age of 355.

EDC will keep a close eye as these trends develop. Look out for our next monthly employment report on January 20.
 

Sources:

1.      National Retail Federation: https://nrf.com/news/retail-sales-see-solid-gains-first-half-of-holiday-season

2.      San Diego December 2016 LMI Release: http://www.labormarketinfo.ca.gov/file/lfmonth/sand$pds.pdf

3.      EMSI; CA LMI; BLS; Infogroup

4.      Macy’s Press Release: http://www.wsj.com/articles/PR-CO-20170104-910412

5.      EMSI; CA LMI; BLS; Infogroup