San Diego County's gross domestic product amounted to about $149.88 billion in 2006 and is projected to exceed $157 billion this year and more than $165 billion in 2008.
During a recent Society for Marketing Professional Services at the Mission Valley Doubletree Hotel, Kelly Cunningham, economist for the San Diego Institute for Policy Research, said if the county were a country, it would rank 36th in the world in 2005; California, with a $1.62 trillion GDP, would have been ranked eighth between Italy and Spain.
The county's economy has become diversified since the early 1990s when General Dynamics fled, taking with it tens of thousands of direct and indirect jobs.
"General Dynamics had 40,000 people. I don't think Qualcomm has 10,000 people," consultant Gary London of The London Group said.
Today, San Diego County is one of the country's top centers for biotechnology, has a strong high-technology presence, and military contracting continues to play a major role in the area's economy.
Figures for 2005 and 2006 were not immediately available, but the San Diego region posted $5.1 billion in defense contracts and $5.06 billion in defense-related salaries in the 2004 fiscal year, according to data Cunningham cited from the Consolidated Federal Funds Report and the U.S. Census Bureau.
Cunningham, who formerly headed the Economic Research Bureau for the San Diego Regional Chamber of Commerce, cited a PriceWaterhouseCoopers report, saying San Diego received $380 million in venture capital for a variety of enterprises in the biotechnology and high-tech arenas last year. That placed fourth behind Silicon Valley with $2.16 billion, New England with $695 million and the New York metro area with $550 million.
"San Diego was named the top biotech center in the country by the Milken Institute in 2004," Cunningham said.
Cunningham said San Diego, which continues to have an unemployment rate of 4 percent or less, has fared better than many areas, even through the last recession.
"While San Jose and the Bay Area hemorrhaged jobs, San Diego never actually lost jobs," Cunningham said.
Cunningham warned that a 0.2 percent uptick to 3.7 percent in San Diego County's unemployment from November to December bears watching, for it could be the first indication of a significant slowdown.
Cunningham said there continues to be a major housing crisis in the county.
"We have added 1 million people since the 1980s and we're building fewer units every year," Cunningham said.
Cunningham said in 1986, as many as 44,000 residential units were constructed in the county. Last year the figure was 7,000 (give or take depending on the survey) and as homebuilders watch for the market to turn while multifamily builders wait for it to catch up to inventory, some suggest the number could drop to as low as 3,000 units in 2007.
In terms of population, Cunningham added that even with 14,000 more people leaving the region than coming in last year, San Diego still had positive net growth due to births over deaths.
Approximately 3 million people are living in the county today. Cunningham lamented that although approximately 700,000 people were added between 1990 and 2006, the number of 25- to 30-year-olds actually declined throughout many of those years. In short, the region is experiencing a young-person brain drain as many leave this market for more affordable pastures elsewhere.
Even with a modest drop in home prices in recent months, it still isn't easy to live here. The California Association of Realtors reported the median price of a first-time home in the county was $492,810 in the fourth quarter of last year. Such a buyer needed $3,330 every month to pay for a mortgage, taxes and insurance, and an annual income of $99,880 reportedly was the bare minimum needed to qualify.
London said the good news for San Diego is there is lots of foreign investment, adding that the Mexicans who shop on this side of the border spend about $4 billion every year.
London said there is more good news about San Diego County's economy -- for instance, the hotel occupancy rate is running at about 76 percent.
"That's a rate nearly 10 percent above the national average," he added.
