Manufacturing in North County generates $18 billion in annual economic impact, according to a new study that examines the effect of the industry on the San Diego region.
The report, The Future of Manufacturing in North County, finds that manufacturers’ growth continues, even in the face of shifts in automation and globalization that could threaten jobs, and as businesses contend with ongoing fallout from COVID-19.
The study, by Innovate78, a partnership by the cities of Carlsbad, Escondido, Oceanside, San Marcos and Vista, analyzes trends in employment, while also taking into account results from a survey of 813 manufacturing firms.
Jordan Latchford, research manager at the San Diego Regional Economic Development Corporation, which oversees Innovate78, noted the breadth of goods produced along the corridor, “from craft beer to surfboards, to life-changing medical devices.
“This study confirms the manufacturing industry in North County is poised for a strong recovery, and will remain a significant economic driver for the San Diego region,” Latchford said.
The production of high-value goods such as computer and electronic products accounts for nearly one-third of all manufacturing jobs in North County — 12,746 of the total 40,151 jobs reported in the study.
That number is expected to grow nearly 6% over the next five years.
Flux Power, a Vista company that manufactures lithium-ion batteries for industrial and commercial equipment, increased both their staff and revenue in 2020. With more than 100 employees, the company is looking to expand within the region.
They’re not alone — 58% of Innovate78’s survey respondents also hope to increase their space.
“The need to be efficient, safe and environmentally-conscious is high, especially now, as businesses plan for post-COVID-19 recovery,” said Chuck Scheiwe, Flux’s chief financial officer. “Manufacturing products that empower others to improve their day-to-day efficiencies will be critical in our industry and region’s future growth, and we’re proud to be part of it.”
Like most industries, though, manufacturers along the state Route 78 corridor took hits due to COVID-19.
According to the study, 43% of survey respondents reported a loss of revenue in 2020.
Looking at net growth, however, there was a 1% increase in manufacturing jobs, with 186 lost and 956 gained as reported by respondents.
Most job losses were in medical manufacturing, while most gains were in machinery production.
Quik-Pak, an Escondido-based computer and electronic manufacturing company, hired staff and reported increased revenue despite the pandemic. Rosie Medina, Quik-Pak’s vice president of sales and marketing, pointed to “the strength of the manufacturing industry in North County” as a reason to expand.
“The talent pool is rich, and there is space to grow,” she said. “We appreciate that not every region has both of these critical components that are needed for our industry to thrive.”
North County’s manufacturing industry, though, faces pressure from automation and globalization.
According to the report, almost a quarter of North County’s manufacturing jobs — 9,804 positions — are threatened by “a higher-than-average risk of automation.”
Companies will need to invest in training to help move these workers into other quality jobs, the report concluded.