The early 1990’s was an economically bleak time for San Diego. The region’s largest private sector employer, General Dynamics, had shuttered its Kearny Mesa facility. The savings and loan industry experienced significant job cuts as a result of the imploding Southern California housing market. Unemployment rates spiked, municipal revenues stagnated and national commentators asked whether San Diego, along with the rest of the state, would ever recover.
A remarkable recovery has taken place over the past 15 years. Local entrepreneurs have undertaken bold new ventures which are built upon the resources and attributes of the region – a talented workforce, strengths in research and development, century-long partnerships with the U.S. Navy and Marine Corps, and a wonderful climate. The efforts of these private sector trailblazers in San Diego have created a 21st century economy that is diversified and, consequently, much more resilient to downturns in the business cycle. While it would be irresponsible to declare that San Diego is now “recession-proof” or that we should rest on laurels, it is not too far a stretch to suggest that this diverse economy is likely to continue to grow. Barring serious economic dislocations, most economic forecasters expect San Diego to continue to outperform the state and the nation.
A key pillar in our diversified economy is San Diego’s visitor industry. Today the San Diego Institute for Policy Research released a major report on the state of the visitor industry and its economic contributions to the region. The full report, the first of what we hope will be a series of reports examining San Diego’s key economic sectors, can be found at www.sandiegoinstitute.com. As the report’s author SDI Senior Fellow and Economist Kelly Cunningham points out, the visitor industry employs more than 100,000 workers and in 2006 attracted more than 30 million visitor to the region. The industry has been growing at an average rate of 6.8% a year and, in 2006, contributed more than $7.7 billion to the county’s economy. Such success has been the result of entrepreneurs such as the Evans family, Doug Manchester, Terry Brown, David and Leslie Cohen, Sam Ladeki,Chris Cramer, Daniel Tucker and scores of other risk-takers and local leaders who have built an industry that fosters a collaborative culture and has positioned the region to prosper through the next decade.
Vital to our continued success is keeping this industry free from intrusive government. Policymakers must create a business environment that allows and rewards risk-takers for seeking out innovative solutions. There is much still to be done. It takes far too long and is too expensive in this region, for example, to win regulatory approval for new development. This, in turn, deters certain capital investment and costs the region jobs while doing little to advance other regional goals.
Along with continuing to improve the region’s regulatory and fiscal environment it is also critical for policy makers to support certain key public-private partnerships. These facilitate the industry’s reinvestment of revenues into important projects that help the industry continue to grow. From financing the expansion of the San Diego Convention Center, to promoting San Diego through the San Diego Convention and Visitors Bureau, to maintaining the beauty of Mission Bay, these public-private partnerships improve San Diego and are smart reinvestments into the region’s future prosperity. The challenge is ensuring that this reinvestment is done in an efficient and effective manner and not used as an excuse to fund government largesse or unrelated activities. San Diego policy makers need to look at the visitor industry not as a cash cow but as a golden goose.
The coming decades will bring many challenges and opportunities. But if the track record of this industry is any guide, San Diego’s leaders and entrepreneurs will meet those challenges head-on and continue to expand one of San Diego’s most important engines of prosperity.
Reader Feedback
There are no comments yet for this article. Be the first to post!
Post a Comment
Feedback Rules:
Users may post more than one comment, but should not pose as multiple users. Multiple posts from the same IP address but with a different user name on each will be reviewed to determine whether abuse has occurred.
Posts with personal attacks or unsubstantiated allegations may be edited or deleted.
If you have not posted before, you will be required to verify your email address before your post is displayed.
