New Economic Study casts South San Joaquin Valley as California “Success Story”

A new study about the South San Joaquin Valley has found that contrary to popular belief, the region has actually outperformed most other areas of the state in its long-term job expansion, as well as other key measures of growth.  The results of the report will be presented at the Doubletree Hotel in Bakersfield at 9 am on Friday June 20th, in a public meeting co-sponsored by California State University, Bakersfield.  The report will be presented in Fresno County at a community event in July.

Published by the Pat Brown Institute for Public Affairs at Cal State L.A. with funding from The California Endowment, the study by independent research firm Beacon Economics finds that between 1990 and March 2014, the South San Joaquin Valley expanded its employment base by 50% – the 8th largest expansion among the state’s 26 metropolitan areas. Over the long term, this job growth exceeds that of the state’s most famous economic powerhouses, San Francisco and the Silicon Valley.

“Beacon Economics knows our region well and it is evident by the thorough analysis and findings generated in this report.  Our region is recovering and as Beacon notes, we have many, many positive attributes that will continue to contribute to positive economic growth in 2014 and beyond.  We are confident that the forecast Beacon has issued will be achieved or exceeded.” --- Paul M. Saldana, CEcD, President & CEO, Economic Development Corporation

The South San Joaquin Valley has one of the fastest growing populations in the state – an indicator not consistent with an economy in decline. Since 1990, the number of local residents in the region has grown by 50% compared to a roughly 28% population expansion in the rest of the state.

“Many of the study’s findings may surprise people given pessimistic perceptions about the future of the South San Joaquin Valley’s economy,” said Dr. Raphael Sonenshein, Executive Director of the Pat Brown Institute. “The authors show that the region has not only been  a long term driver of economic growth in the state, but more recently, that it has largely recovered from devastating damage caused by the recession.”

The Beacon analysis finds that although the South San Joaquin Valley was hit harder by the recession than most of the rest of the state, it has now recovered all the jobs it lost, and consumer and business spending has surpassed its pre-recession peak.

The Pat Brown Institute partnered with CSU Bakersfield to bring the findings of the report to the Kern County community.  “With one of California’s fastest growing populations and many challenges ahead, bringing accurate and well-reasoned analysis about the successes and future direction of the South San Joaquin Valley to the forefront of public discussion has never been more important,” said Dr. Horace Mitchell, President of CSU Bakersfield. “The study brings applied research to an often misunderstood area of California and will hopefully foster dialogue about how to address our local challenges and opportunities.”

Things are not all rosy.  The report notes the impact of pollution and the continuing drought.  Indeed, drought faces California’s colossal agriculture industry with a major threat to the region and the state. “The South San Joaquin Valley represents a much larger share of the California economy than it used to, growing in relative not just absolute terms,” said Christopher Thornberg, Founding Partner of Beacon Economics and one of the study’s lead authors. “As an increasingly vital part of the larger economy, effects here will leak out to the rest of the state making it all the more important to address serious challenges, including what may be the worst drought on record.”

Findings from the report, South San Joaquin Valley: A Growing California Success Story, will be presented at events in Bakersfield in June and Fresno in July. Members of the media who would like to attend, please contact Jackie Ruiz at JRuiz@cslanet.calstatela.edu.

Read or download the report at: http://www.patbrowninstitute.org/publications/documents/SJVReport.pdf

 

SELECTED KEY FINDINGS:

  • The share of California nonfarm employment located in the South San Joaquin Valley grew from 3.8% in 1990 to 4.5% in 2013.
  • The South San Joaquin Valley has exceeded its pre-recession employment peak, adding back 61,300 nonfarm jobs – 8,000 more than lost during the recession – since July 2010.
  • Employment has been growing in both high and low wage sectors in the South San Joaquin Valley. The Utility, Mining, and Information sectors, which pay between $60,000 and $102,000 per year on average, have significantly expanded their shares of the local economy.
  •  In terms of Gross Metropolitan Product, the South San Joaquin Valley was responsible for 33.2% of the economic output in California’s Agriculture sector in 2013.
  • Spending by businesses and consumers in the South San Joaquin Valley has reached an all time high with roughly $8.8 billion in taxable sales receipts counted during the fourth quarter of 2013.
  • Although median home prices remain below their pre-recession peak, they have risen rapidly in the past year and prices in the region are forecast to continue growing in the 5% to 7% range over the next few years.
  • The South San Joaquin Valley is a highly ‘home-affordable’ region relative to other parts of the state, making it attractive to many residents and indicating that more housing units will be needed in the future. Through the end of 2013, residential building permits were almost 50% higher than they were in 2012.

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The Edmund G. “Pat” Brown Institute for Public Affairs, established at California State University Los Angeles in 1987, is a nonpartisan, applied public policy center dedicated to the quest for social justice and equality of opportunity, enlightened civic engagement, and an enhanced quality of life for all Californians.

The California Endowment is a private, statewide health foundation with a mission to expand access to affordable, quality health care for underserved individuals and communities, and to promote fundamental improvements in the health status of all Californians.

Pat Brown Institute, California State University, Los Angeles, 5151 State University Drive, GE Rm 222, Los Angeles, CA   90032-8261.  (323) 343-3770.