The latest employment numbers are in, and the news is almost all good: 295,000 jobs were created in February, and the updated unemployment of 5.5% is the lowest since rate since 2008. The economy has created over 200,000 jobs a month for twelve straight months, the best sustained stretch of job creation in a generation. A stable, sustained economic recovery now seems to be well under way, with the only lagging indicator remaining stubbornly slow wage growth.
Our own data shows demand for new workers on the rise in cities across the U.S., with one city in particular showing strong month over month growth. I was excited to see that Greater Los Angeles, my hometown, is tops in overall job demand over the last 30 days.
There’s definitely something happening here in L.A., something that’s not getting the appreciation it deserves: the economy here is now not only back from the lows of the Great Recession, it’s poised to surge to new highs.
I wanted to get a fuller picture of just why that was. As I started looking into it, I realized that the indicators of sustained strong growth can be found within three core industries across the Los Angeles region:
The L.A. Tech Scene Is All Grown Up
Los Angeles County has rapidly matured as a tech center since 2003, with almost 15% of hiring in the county coming in the tech sector. To put that hiring in perspective, according to the LAEDC Los Angeles now has more 350,000 high tech jobs - more than Boston, Silicon Valley, or New York City.
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That concentration of business and talent is making VC’s sit up and take notice. L.A. startups (including the one I work for) are now regularly garnering millions of dollars in venture capital investments, with over $3 billion raised in 2014.
And it’s not just homegrown companies that are making L.A. a hot tech market. Google is joining Facebook and Microsoft in expanding their presence in the city’s uber-hot Playa Vista district, where a construction boom is creating thousands of square feet of the kind of Class A office space top tier tech players crave.
Space is the Place
L.A.’s aerospace industry famously took a huge hit with the end of the Cold War, but the area - which has a long, storied past as a cradle of aerospace innovation - is looking to make a comeback by reinventing itself as a center of the emerging commercial space industry.
Virgin Galactic recently announced that they will be moving manufacturing of their Launcher One rocket to nearby Long Beach, where they will open a 150,000 square foot facility and take advantage of the deeply skilled local talent pool by creating over 100 new jobs.
Richard Branson and company join Elon Musk’s SpaceX, which also builds rockets for commercial space ventures, as a major player in the South Bay area’s space and rocketry sector.
Trade with Asia is Driving New Growth
As the home of two of the world’s busiest seaports and the air cargo hubs of the Los Angeles World Airports system, L.A. is the import/export route for hundreds of billions of dollars of trade with Asia, with China alone accounting for $164 billion in trade activity.
Los Angeles Mayor Eric Garcetti has shown that he recognizes the importance of trade relations with China (whose tourists spent $655 million in the city in 2014), signing a number of agreements during a trade and tourism mission late last year, including a deal to facilitate the treatment of Chinese citizens in area healthcare facilities.
The wide-ranging set of agreements will help pave the way for even more trade between L.A. and the Big Three of China, Japan, and South Korea, and with labor issues at the port now settled, the area is well-positioned to benefit from close relationships with our neighbors across the Pacific.
As a L.A. native and a veteran of the tech scene here, it’s personally exciting to me to see Southern California leadership making moves to become more competitive; Mayor Garcetti in particular gets the importance of tech for the future of the L.A. area economy. Throw in the region’s robust tourism industry, a world-leading media and creative services sector worth billions, and newly emerging clean energy and biotech sectors, and it becomes clear that Los Angeles is set for strong growth well into the future.
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