The City of San Diego’s Hand-Picked Growth Industries
By Lisa Halverstadt.
San Diego’s on a mission to court a handful of industries it’s decided are crucial to the city’s economic future.
The regional economy has long been buoyed by tourism and the military, and those industries have gotten lots of city support for decades. The city’s latest economic development strategy also focuses on other industries that the city wants to see flourish: manufacturing and trade.
There’s a tie that binds all these so-called economic base sectors. They’re made up of businesses that sell their goods and services to customers outside San Diego, thus bringing in money that wouldn’t otherwise flow here.
Economic-development gurus are focused on these businesses because they draw new jobs and support local-serving businesses.
For this reason, the economic development plan the City Council approved in June encourages policy changes and incentives to aid these export-focused companies.
The specific actions the city’s promoting in this plan, such as convening more task forces, aren’t particularly groundbreaking, but calling out the industries it’s decided are most crucial to San Diego’s future economic growth allows city leaders to prioritize.
Companies within the industries listed in the city’s roadmap are the most likely to be on the receiving end of city perks and incentives as they look to expand or move. And city policymakers will be especially eager to tackle regulations and permitting roadblocks that affect them.
Here’s a breakdown of those top industry clusters and some of what the city’s economic development strategy suggests doing to help them.
The Sector: Manufacturing and Innovation
A worker packages beer at Ballast Point Brewing & Spirits Company.
San Diego is determined to get more manufacturing jobs.
Much of San Diego’s recent job growth has been in high- or low-paying sectors (that’s why it’s often called an hourglass economy), and manufacturing jobs often provide middle-class salaries and spillover effects for the local economy. The city estimatesthat each manufacturing job indirectly results in two to six others.
San Diego’s current manufacturing workforce isn’t insignificant. San Diego is the nation’s 10th largest manufacturing hub based on number of jobs, and the goods that flow in and out of the region have among the highest average values in the nation.
San Diego is also home to a wide spectrum of manufacturing companies – everything from biotech businesses that make medical devices and treatments to craft beer and biofuel producers. The city’s economic development blueprint emphasizes the need to help emerging parts of this sector, particularly those that are tied to research and development.
A trio of companies in this group became the first to benefit from City Council-approved economic development agreements this summer, a tack the city hadn’t tried in more than a decade.
Ballast Point Brewing & Spirits Company and AleSmith Brewing Co. are set to be reimbursed for their spending on city permits associated with impending expansions. The city will reimburse the two breweries once they generate additional sales tax revenue.
And genome sequencing company Illumina will get a tax rebate of up to $1.5 millionif it produces additional tax hauls projected along with an expansion in San Diego.
San Diego doesn’t have much undeveloped industrial land to spare and manufacturing businesses tend to rely heavily on water so these companies have big questions about the cost and supply of that precious resource.
Three Ways the City Wants to Help
• Exempt manufacturing companies from the affordable housing fee, which requires companies to help pay for subsidized housing projects.
• Review the municipal code to pinpoint changes that might make manufacturing easier in the city’s industrial zones.
• Create a “Buy San Diego” campaign to promote San Diego products to consumers and other businesses.
The Sector: International Trade and Logistics
The city of San Diego’s office space in Tijuana, Mexico.