San Diego Business Journal

— Like Comic-Con, there are good guys and bad guys.

But in cybersecurity, the bad guys are real, and the good guys pack more of an economic punch.

A new study suggests San Diego’s cybersecurity sector has the

economic impact of 14 Comic-Cons.

Players include large companies such as Northrop Grumman Corp. (NYSE: NOC), smaller companies such as AttackIQ Inc., and organizations such as the U.S. Navy.

Local companies specializing — or with a significant concentration — in cybersecurity include CyberFlow Analytics, EdgeWave, ESET, FICO, ForcePoint (formerly Raytheon Websense), iboss Cybersecurity, Qualcomm Inc. (Nasdaq: QCOM), Security On-Demand, Sentek Global and ViaSat (Nasdaq: VSAT).

Job Creation

The sector gained a significant number of jobs in the last two years, expanding 14.7 percent to 7,620 positions, according to a recently released study from San Diego’s Cyber Center of Excellence Association.

Mayor Kevin Faulconer said he was “not surprised” at the double-digit growth.

The low-key core of San Diego’s cybersecurity cluster is the Navy, specifically the Space and Naval Warfare Systems Command, known for short as SPAWAR. Faulconer called SPAWAR “the best incubator you can ever have” during a news conference introducing the report June 23.

Jobs at SPAWAR grew 9.5 percent over two years to 3,390.

The number of private-sector cybersecurity jobs has grown even faster: 19.2 percent over two years. Some 4,230 employees work in 104

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Ken Slaght

companies, said Ken Slaght, the association’s president (and the retired commander of SPAWAR).

The association produced a two-year comparison because its first study was in 2014.

The global cybersecurity market is expected to grow from $77 billion in 2015 to $170 billion by 2020, according to Silicon Valley-based Cybersecurity Ventures.

The global cost of cybercrime is expected to reach more than $2 trillion by 2019, according to Juniper Research. There is no lack of things to do, City Council President Sherri Lightner remarked during the study’s unveiling.

Study authors crunched the numbers and found that cybersecurity adds $1.1 billion to the San Diego region’s gross domestic product.

Consider multiplier effects, however, and San Diego’s cybersecurity sector turns into a $1.9 billion economic force. Multiplier effects include the effect on the supply chain (called indirect impact) and the phenomenon of employees spending their household income in the economy (called induced impact under the IMPLAN software model that study authors used).

The $1.9 billion number is what led authors to conclude the sector is worth more than a dozen Comic-Cons.

The cybersecurity sector is only going to get bigger. Over the next 12 months, study authors expect the number of jobs to grow 13 percent — much faster than the 2 percent growth expected for the job market as a whole.

San Diego wins because cybersecurity employees have spending power. The average annual salary for analysts, computer scientists and software developers employed in the industry is $116,000, according to the study.

By contrast, network support specialist jobs pay an average of $75,000 per year, and usually don’t need a college degree.

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Eric Basu

Eric Basu, CEO of Sentek Global, said during the news conference that San Diego loses a considerable amount of talent. Local universities graduate 3,000 computer science and engineering students every year.

Once they get their diplomas, however, many of those students leave town and thousands of cybersecurity jobs go unfilled, Basu said.

Study authors suggested that more internships would provide incentives for San Diego students to stay in the area once they had graduated.

Meanwhile, the number of higher-education programs is growing, with the University of San Diego and Cal State University, San Marcos introducing cybersecurity master’s degree programs recently.

Unified Approach

Study authors also said San Diego needs to raise its national profile in cybersecurity.

The authors called for political leaders, industry leaders and trade organizations to adopt a “unified communications strategy” — and to not be shy when talking about San Diego’s strengths. There are plenty of opportunities at national cybersecurity hackathons or other events that might promote San Diego on the national stage, study authors said.

“If you’re in cybersecurity, you need to be with the leaders in San Diego,” Faulconer told the group at the study’s unveiling.

Qualcomm hosted the event in its Building AZ on Sorrento Mesa.