June 2005

Economic Profile - San Diego, California - USA

San Diego

San Diego, the 7th largest city in the United States, 2nd in the country, is home to one of the strongest local economies in the United States. Recent years have seen the diversification from a predominantly defence and military-based economy to a more vibrant economy featuring biotechnology and information technology sectors. This successful diversification has allowed San Diego to insulate itself against the cyclical effects of any particular sector. In addition, San Diego is home to several world-class research institutions. For the purposes of the Canadian industrial development program in San Diego, primary focus is being given to leveraging the biotechnology, information technology, and aerospace and defense sectors as well as fostering collaborative relationships between Canadian and local research institutions and universities.

San Diego has grown to be the third largest region in the world for biomedical and biotechnology companies behind only the entire Bay Area and the greater Boston area. San Diego's Bioscience cluster consists of over 265 growing companies including worldwide biotechnology leaders such as Novartis, Pfizer, Johnson & Johnson, Merck, Monsanto, Dow, Becton Dickinson, Biogen-IDEC, Nanogen, Gen-Probe, Invitrogen, Isis, Diversa and Amylin. The City has also has the highest number of PhD's per capita and the largest number of science-based Nobel winners in the world.

In the field of information technology, there are nearly 160,000 high technology workers in the 1,400 companies throughout San Diego. Telecommunications, such as wireless phones, contributes more than $5 billion to the local economy each year. San Diego is home to many large technology companies including Qualcomm, as well as the San Diego Supercomputer Center, one of three such centers in the nation, funded by the National Science Foundation.

With respect to Aerospace and Defence, San Diego receives the second-highest level of US Department of Defense expenditures in the nation, trailing only the Los Angeles County area. An important development in recent years was the relocation of the US Space and Warfare Systems Command (SPAWAR) from Virginia to San Diego in 1997.

The City of San Diego's strong economy, diverse population, great educational institutions, unsurpassed quality of life, and world-renowned location make it the ideal place to do business, to work, and to live. Because of its highly-educated workforce and mix of high-tech industry and recreational assets, a marketing consortium of high-tech industries has dubbed San Diego "Technology's Perfect Climate."

There are five world-class research institutes in the greater San Diego area - University of California, San Diego, The Scripps Research Institute, The SCRIPPS Institute of Oceanography, The Salk Institute and the Burnham Institute.

Priority Sectors

There are three important industrial sectors prevalent in San Diego of paramount importance to Canada: Biotechnology / Life Sciences, Information Technologies and Aerospace and Defense.

California

California is the largest state in the union, both in the size of its population and economy. With a Gross State Product (GSP) of $2.1 trillion in 2002, California has the 5th largest economy in the world and is home to almost 14% of the entire US economy.

In keeping with the anaemic momentum of the US domestic economy, California's economy expanded by just 0.4% in 2002 and it forecasted to grow by 2.0% in 2003 and 3.5% in 2004. Even with considerable job losses in the manufacturing and high tech sectors, California's employment growth rate continues to be above the national average. A growing local and national concern is the ballooning state budget deficit, which is expected to exceed $39 billion in fiscal 2004.

Despite the current economic climate, California continues to have one of the most diverse and dynamic economies in the world. While agriculture and other traditional sectors play an important role in the state's economy, California is better known as an innovator and leading producer of high-technology products and services in Information & Communications Technologies, Biotechnology and Aerospace & Defence. It is home to over 50 Fortune 500 companies.

Last year Canada exported over $26 billion in goods to the state and California is Canada's third largest export market in the world after the US, Michigan and New York. Canada now exports three times more to California than it does to Japan, Canada's second largest national trading partner. California had a trade deficit of $15 billion with Canada in 2002.

Priority Sectors

Reflecting the diversity and depth of the economies throughout the territory, the priority sectors for the missions in California include: ICT (wireless, e-security, e-learning), Biotechnology, Cultural Industries (music, film/television and sound), Agrifood/Fish, Consumer Products, Aerospace & Defence, Environmental Industries and Clean Energy