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San Diego Bucks California's Trend in Biz Relocation

The San Diego area saw a net gain in businesses due to relocations and new starts, while California saw losses. Economic gurus say business and jobs creation are the more crucial stats to watch.

San Diego and California aren’t singing the same song when it comes to business relocations.

From 1989 to 2011, San Diego enjoyed a net increase in businesses and jobs due to company moves.

During that same period, the state saw net drops on both fronts.

San Diego Regional Data Library helped us lay out the trend by analyzing a database tracking hundreds of thousands of business moves in and out of California.

These figures include company moves within the state, which are more frequent than the out-of-state moves that tend to make headlines.

 

California economists aren’t surprised. They note that San Diego County’s population grew between ’89 and 2011, and that the region wasn’t hit as hard during the recession.

More importantly, though, the county has an increasingly technology-tied labor force.

San Diego is home to telecommunications giant Qualcomm and a vast spectrum of biotechnology, medical device, engineering and innovation-oriented companies. These industries rely on skills that aren’t easy to find just anywhere, said Jordan Levine, director of economic research at Los Angeles-based forecasting firm Beacon Economics.

He said that factor makes business subsidies or lower costs elsewhere less attractive.

“When you’re in the high-tech industries, things like cheap real estate aren’t as important to you as distancing yourself from those highly skilled workers that you need to be successful in software or hardware development or in the biotechnologies here,” Levine said.

At least 46 firms and more than 13,000 jobs tied to science, electronics, aerospace and technology-tied fields moved to San Diego from elsewhere over the 22-year period tracked in the massive relocation database. The database’s categories for that migration are fairly broad, though, so it’s tough to pin down which specific types of jobs or businesses moved.

But Levine and other economists often point out business relocations aren’t really that big of a deal. Stephen Levy of the Center for Continuing Study of the California Economy even dubbed them “a pimple on the state of California economy.”

He’s right.

The database revealed the San Diego region gained a net 7,932 jobs to relocation over the 20-year period, a figure that would amount to .5 percent of the county’s current labor force.

Far more crucial, he and economic development gurus say, is new business and job creation. That’s what we’ll explore next.

This is part of our quest digging into the difficulties – real or perceived – of doing business in San Diego. Check out the previous story in our series, San Diego Businesses, By the Numbers, and the next, Ranking San Diego’s Business Climate: A Selective Science.

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