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Monday, Mar 18, 2024
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Finding Its Direction

North County, home to nearly 900,000 and stretching across beach, mountain and desert, is full of contradiction.

The region boasts a diverse swath of fast-growing industry clusters — but also has an aging population and a stratified workforce with a notably declining middle class. Quality of life is excellent, and it’s in a prime location, with Orange, Riverside and Los Angeles counties nearby.

Real estate can range from a 2013 median price of $350,000 to more than $1.5 million, depending on the area and proximity to the beach.

Even the region’s boundaries are contradictory. Depending on who you’re asking, North County could stretch from Poway to the edges of Temecula, enveloping high-traffic regions like University Towne Center and La Jolla. Others consider it to be limited to the 78 Corridor that’s made up of just Escondido, Carlsbad, San Marcos, Oceanside and Vista.

Six Key Industry Clusters

Contradictions aside, there’s consensus that the region is showing growth in six key industry clusters: biotechnology and medical devices, sports and active lifestyle, information and communications technologies, clean technology, connected tourism and agriculture, and building and design.

“We’re seeing in North County a change,” said Josh Williams, president of Carlsbad-based market research firm BW Research Partnership Inc. “It’s turning from an agrarian bedroom community into its own viable economic region.”

The San Diego North Economic Development Council commissioned Williams and his team to create an economic impact report on North County. It is slated for release on March 5, during the EDC’s yearly economic summit.

Williams said high-paying professional positions that require four-year degrees or more are on the upswing in North County, particularly in the biomedical sector. This market, which Williams called “tier 1 jobs,” grew more than 4 percent from 2008 to 2013, Williams said — outpacing the proportional professional job growth throughout California and the nation as a whole. In North County, these jobs have an average salary of $76,000.

“The amount of money that gets pumped back into the community through these paychecks — it creates a thriving environment, and it’s only going to continue to grow,” said Debra Rosen, CEO of the San Diego North Chamber of Commerce.

But the growing sophistication of North County professionals isn’t representative of the region’s complete workforce, which is growing more fragmented, Williams said.

North County’s Recovery Is Lagging

“North County’s job market has not recovered from the 2008 recession as quickly as either San Diego County or as California as a whole,” Williams said.

Williams said the number of tier 2 jobs — the ones that are middle-skill and middle-wage positions — as well as tier 3 jobs — low-skill, low-wage positions — have shrunken considerably in North County.

“The Great Recession really killed one of the mainstays of tier 2 jobs — construction,” Williams said. Other impacted positions include government workers and those in the lower-level banking, finance and manufacturing industries.

Tier 3 is also hurting, but not as badly. One of the largest employment segments for this job level is in tourism — one of the region’s fast-growing industries. Though North County has a large tourism footprint, Williams said, the individual golf courses, breweries and hotels tend to be smaller than many other vacation spots in San Diego.

Export-oriented clusters could prove the best economic assets for North County, Williams said, because they bring in wealth from outside of the region. The businesses that can bring the most out-of-town dollars tend to be in the biotechnology and medical device cluster, sports and recreation companies, and connected tourism outfits.

Indeed, Vista-based medical device maker DJO Global Inc. is a global company, selling products like orthopedic shoes and sports braces all around the world; the same goes for Carlsbad-based Callaway Golf Co.’s clubs and accessories. Popular destinations like the San Diego Zoo Safari Park and Legoland draw visitors perennially.

North County is ‘Graying Faster’

The U.S. population is getting older. And Williams said North County is “graying even faster than Southern California, the state and the nation as a whole.” A population built of baby boomers is driving health care demand in the region, which could validate the recent hospital construction in the region, such as the $1 billion Palomar Medical Center in Escondido.

One real challenge for North County is that growth is occurring at the younger and higher ends of the age curve, Williams said.

“The working population is getting smaller in proportion to the older and younger folks,” he said. “It won’t have an immediate impact, but in five to six years, it might.”

Outside of the more urban pockets in Encinitas and Carlsbad, there’s little around to attract 20- to 29-year-olds. But that could change in even a few years, Williams said.

“General Atomics is here. Qualcomm is here. And we’re enabled by world-class universities across multiple disciplines,” Jim Zortman, a sector vice president at Northrop Grumman Corp., said at the San Diego North Chamber of Commerce’s recent State of the Region luncheon held at the Sony Corp. facility in Rancho Bernardo.

Indeed, North County is also growing an educational cluster, and is home to California State University San Marcos, MiraCosta College, Palomar College and National University.

“All these places produce research and development that can be injected into the economy that really drives growth,” Zortman continued. “But more importantly, they attract talent.”

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