Metro Economic Outlook: San Diego

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1 Metro Economic Outlook: San Diego Job opportunities have increased steadily in most major sectors of the San Diego region s economy, and that growth has quickly created tight conditions for employers that still want to grow their payrolls. As a result, a program sponsored by the San Diego Workforce Partnership (SDWP) has suddenly become quite popular. The nonprofit agency has a customized training initiative that aims to fill the gaps for hard-to-find workers in advanced manufacturing, technology and other sectors. Through agreements with employers, SDWP covers half the training costs. In turn, employers must hire at least 80 percent of the workers that complete the program, said Tina Ngo Bartel, director of research SAN DIEGO METRO: : VITAL STATS Total working age population: 2,027,391 out of a total population of 3,263,431 Number of households: 1,100,858 Consumer price index: (goods and services that cost $100 in cost $ in 1 st half of 2016) Percentage of local residents with bachelor s degrees: 23.3 With graduate or professional degrees: 13.8 Workers in STEM industries: 35.1 per 1,000 residents Sources: Census Bureau (2014), Bureau of Labor Statistics (1 st half of 2016), American Institute for Economic Research (2015) Unemployment rate Source: Bureau of Labor Statistics (October 2016) with the SDWP. As recently as five years ago, SDWP would have one such contract per year. Through the first half of 2016, five contracts have been signed. It s a direct response to conversations we ve had with employers, Ngo Bartel said. Many of them can t hire people right off the shelf anymore, so we invest in the training to get workers on board. Among the high-growth industries in San Diego is the production of unmanned aerial vehicles (UAV), sometimes referred to as drones. UAVs represent nearly $2.3 billion in direct and related economic activity locally, according to a report commissioned by the San Diego North Chamber of Commerce. The UAV industry also supports more than 7,000 local jobs, and global demand for UAVs is expected to reach $12 billion by 2019, according to the chamber s report. Unemployment and most CPI data updated monthly. Other data updated once annually as it becomes available.

2 The San Diego metropolitan area covers San Diego County and includes the cities of Carlsbad, San Marcos and Chula Vista. The area s military/industrial complex contributes $28 billion annually to the local economy and employs nearly 25 percent of the region s labor force, according to a study by the nonprofit San Diego Military Advisory Council. Construction Mining and logging Manufacturing Trade, transportation and utilities Information Financial activities Professional and business services Education and health services Leisure and hospitality Other services Government Total nonfarm Source: Bureau of Labor Statistics (January 2016) It s a very tight market overall right now, Ngo Bartel said. Job seekers are being picky, too. They have many options available to them, so they re taking their time. Some of San Diego s major private sector employers 197,192, 1 426,577, 21% 175,138, 9% Source: Census Bureau (2014) Working age categories 429,612, 21% 272,244, 13% 526,628, 26% Labor force makeup ,000 1,500 Number in thousands include technology development and communications company Qualcomm, government contractor and scientific interest SAIC, and NASSCO, a division of General Dynamics that designs and manufactures vessels for the Navy. The region s recent growth has been made possible in part by extensive investment in local infrastructure, according to a report from the San Diego Regional Economic Development Corp. (SDEDC), a nonprofit that supports local economic activity. 20 to to to to to to 64 A 1988 voter-approved initiative that added a half-cent to the local sales tax has paid big dividends, according to the SDEDC. Nearly $3.3 billion has been collected from the program as of May 2016, and it has been leveraged with nearly $10 billion from federal, state and local funding sources to deliver more than 650 infrastructure improvement projects. 2

3 Employee Benefits Data Employers offering consumer-driven health plans 24% 36% Employers in the San Diego metro area offer consumer-driven health plans at a higher rate than the national level, by a margin of 12 percent Employers offering domestic partner benefits 71% 5 They are much more likely to offer domestic partner benefits, by a 21 percent margin above the national level. Source: SHRM Health Care Benchmarking Database (2015) Retirement Employee 401(k) participation rate % 53% The rate of 401(k) participation in the San Diego metro area s workforce is lower than the national level, by a margin of 9 percent. 2 1 Last updated Source: on SHRM 12/1/2016 Retirement & Welfare Benefits Database (2013) 3

4 Income and Turnover Data 25% 2 15% 1 18% Overall turnover rate 24% The turnover rate in the San Diego metro area s workforce is higher than the national level, by a margin of 6 percent. 5% Source: SHRM Human Capital Benchmarking Database (2015) $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 Median household income $66,192 $53,657 Median household income in the San Diego metro area is moderately higher than the national level, by more than $12,000 annually. Source: Census Bureau (2014) $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0 Per capita income $31,770 $28,889 Per capita income in the San Diego metro region is slightly higher than the national level, by nearly $3,000 annually. Source: Census Bureau (2014) 4

5 Top Management Salaries Data Median salaries, top management *Top legal executive *Chief information officer *Top HR executive *Chief financial officer *Chief executive officer $310,300 $310,100 $304,500 $270,000 $255,000 $254,900 $365,000 $350,400 $717,200 $623,200 Median salaries for top management positions in the San Diego metro area are typically on par with or higher than national levels. *California state median data $0 $200,000 $400,000 $600,000 $800,000 Source: Towers Watson Data Services 2015 Survey Report on Top Management Compensation Project lead: Joseph Coombs, Senior Analyst, Workforce Trends, SHRM Project contributors: Alexander Alonso, Ph.D., SHRM-SCP, VP of Research; Jennifer Schramm, M. Phil., SHRM-SCP, Manager, Workforce Trends External contributors: Tina Ngo Bartel, San Diego Workforce Partnership Copy editing: Katya Scanlan, copy editor This report is published by the Society for Human Resource Management (SHRM). All content is for informational purposes only and is not to be construed as a guaranteed outcome. SHRM cannot accept responsibility for any errors or omissions or any liability resulting from the use or misuse of any such information Society for Human Resource Management. All rights reserved. Printed in the United States of America. These materials and the data contained within them are copyrighted by SHRM, another copyright holder (where noted), or are government-owned. SHRM hereby grants permission for users to copy and use these materials and the data contained within them only if proper attribution is given to SHRM (or the noted copyright holder) as the source of the material. For more information, please contact: SHRM Research Department SHRM Human Capital Database 1800 Duke Street, Alexandria, VA 22314, USA Phone: (703) Fax: (703) SHRM Compensation Data Center SHRMResearch@shrm.org Web: 5