The True Impact to San Diego When Apple, Walmart and Others Add Dozens of Jobs

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When stalwart companies or new businesses add jobs to a community, the effects are far reaching. Beyond the initial jobs created, communities see an expansion in infrastructure and services creating more jobs and growth. We’re seeing this happen in San Diego as small businesses thrive and companies like Apple, Walmart, and Teradata add operations in the area.

Without business growth and premium-wage jobs the financial and socio economic health of a community can suffer immense consequences. The economy of a city, town or village can dramatically be affected by the increase influx of new well-paying jobs. A healthy economy relies on its people to be able to work and receive livable wages so that the cycle continues.

When communities receive more and more new jobs, income inequality decreases while also reaching all aspects of the community from poor to wealthy. The trickle down begins to take effect where the wealth of all members of the community starts to rise. The types of industries that enter a community may have different impacts depending on if it is the steel, coal, healthcare, manufacturing, food service or tech industry. But with more premium wage jobs entering a community, citizens will begin to see the direct and indirect positive effects of overall health, financial security, and quality of life.

Not only does quality of life increase for the individuals in the communities, but infrastructure growth begins to take place. Companies may receive many incentives to come to a new area from the local government. Reaching new growing and emerging markets are enticing, since companies can set up a new sustainable foundation for long-term success. The San Diego North Economic Development Council (SDNEDC) concludes that the major factors related to job growth are the actual wages versus the goods and services purchased locally and non locally. According to the Bureau of Labor Statistics, since the recent recession, small businesses were responsible for the creation of 62% of all new net private-sector jobs across the nation. With that being said, it becomes extremely beneficial to lend and invest once there is an increase in productivity in a local environment.

Once disposable income increases, that leaves more money on the table for future investments. Independent economic analyst Vince Vasquez concludes that when jobs are created in underserved markets of a community, there is a direct positive correlation with the overall health of that community. A major decrease in stress levels for individuals may occur, especially for those who may have been forced to work two part time jobs. As more employers hire more people they can begin to qualify for better health care plan pools. It is important that jobs are spread throughout a community, rather than all the jobs being placed in the wealthier sections of a city or town. The long-term impact of not addressing the underrepresented markets can have negative consequences that do not bode well for the community as a whole.

Across the country there are numerous communities experiencing extreme growth from job creation. The local agencies play a part by incentivizing companies to relocate by including county and city property tax abatements, county loans, grants, freeport exemptions and cash for high performance. The size of the community is a key factor of how much economic development can occur. However, local entrepreneurs are more vulnerable for an economic recession, and changes in energy pricing, so because of this the States place mandates to encourage small business growth.

The types of industries adding premium wage jobs has a direct and indirect impact to a community. For example, according to the San Diego NEDC, for every 100 jobs added in the facility services industry, another 160 total indirect and induced jobs will be created in San Diego County. One hundred jobs added in the food industry would have a net gain of another 184 additional jobs. The trend continues for IT services and the administrative industry. When both industries add an additional 100 jobs, it results in another 120 indirect and induced jobs, respectfully.

According to Erik Bruvold, CEO of the San Diego North Economic Development Council, “bringing 20 jobs and new businesses to underserved communities has another impact that is often overlooked: By building economic capacity and vibrancy into underserved neighborhoods these businesses help to keep local spending local. That, in turn, fuels additional economic impact. While 20 jobs and a new enterprise are welcomed anywhere, it is doubly true in communities where residents currently go outside their community to purchases goods and services. Keeping dollars local is good for economic development and is another reason why building small business capacity in a wide range of industries and sectors is so critical.” If the jobs remain in a particular location of a city or town, then it will be hard to permeate resources and wealth to other portions of the city that need it. This imbalance makes communities unhealthy and can lead to many negative consequences like crime, poor health, lack of education, and more people needing government assistance.

Our local San Diego community has seen tremendous growth in the past year alone and our future trajectory is even better. According to the San Diego Economic Development Corporation (EDC), just in the last year San Diego welcomed Teradata, a data analytics company from Dayon, Ohio, which set up their new headquarters here. Also, Amazon and Walmart Labs are looking to add 350 new jobs near UTC and Carlsbad. The San Diego NEDC estimates that both companies could each cause another 363 jobs to be created locally. Recently, we also welcomed the news that Apple will be bringing 1,000 new jobs to San Diego. The impact could be that San Diego could possibly see another 1,000 jobs added to our community as we will begin to see the growth of more infrastructure, housing and service industries

Of course, it also could increase the traffic, living costs and prices of just about everything. There will always be pros and cons, but this robust job growth will help our city reach new heights and just like other cities across the nation, the power of business will help fuel a better quality of life for all its individuals.

Sources:

https://communityimpact.com/houston/conroe-montgomery/business/2018/12/20/local-incentives-attract-manufacturing-jobs-to-conroe/

https://www.planning.org/pas/reports/report31.htm

http://www.sandiegobusiness.org/blog/san-diego/good-news-2018