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North Bay Business Journal

Monday, May 25, 2009, 12:37 pm

Report lays out regional strategy to keep, create jobs

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    PETALUMA – Transforming the North Bay into a “jobs magnet,” complete with a tri-county “Innovation Corridor” to drive job development is just one of the economic recovery and long-term growth recommendations proposed in a report commissioned by the North Bay Leadership Council.

    Dr. Robert Eyler, chair of the Economics Department at Sonoma State University and director of the Center for Regional Economic Analysis, presented results of his NBLC study to about 150 business leaders, educators and elected officials at the Sheraton hotel in Petaluma on May 20.

    “A regional economy becomes a jobs magnet when mechanisms exist to attract, train and educate workers, match them to jobs and then retain jobs. It’s a model in which job development drives economic growth,” he said. “This report is about action and what can be done in the North Bay by June 2010 and beyond to create such a jobs magnet.”

    Health care, small manufacturing, construction, tourism and the wine industry are seen as growth industries over the next five years due to local established markets, federal stimulus support and/or North Bay economic growth.

    Small manufacturing includes local firms engaged in medical device manufacturing, those making intermediate parts for defense, thin films coatings, etc.

    Scientific jobs, such as within energy and green-tech categories as well as regional local biotech industries, may also expand. The reversal of the stem-cell research ban could mean that firms like the Buck Institute for Age Research and BioMarin in Novato may become epicenters for emerging scientific business clusters.

    The Sonoma Mountain Business Cluster, located in former Agilent Technologies facilities in Rohnert Park, has been up and running for two years with 20 startups in residence. Professional services, such as legal, accounting, banking, real estate and investment services, are also a major source of jobs in this area.

    Local education is seen as the fulcrum for job development by providing training, certification and new workers for scientific, small- manufacturing and service industries.

    According to the National Employment time series, 84 percent of jobs in Marin, 81 percent of jobs in Sonoma and 76 percent of jobs in Napa are in firms with less than 99 employees. Nurturing startups and second stage companies, those with around 10 to 49 employees, is critical for future economic and job stability.

    “The current recession has unemployment rising at a rapid rate in California. It is likely that Sonoma County unemployment will peak at around 11 percent, while the state as a whole is likely to peak at around 12.5 percent. This translates into almost 1.5 million lost jobs in California,” Dr. Eyler said. “The good news is that I see signs that we may have passed the deepest point of the recession.”

    To ensure that job growth will keep pace with population growth, and also to address unemployment issues, he proposes establishing a North Bay regional entity to oversee job development. This entity would coordinate and expand local workforce investment boards and economic development office functions as part of a job-matching infrastructure.

    “The North Bay must become proactive about job matching while also providing incentives to fill vacant commercial space by foreseeing needs rather than reacting to losses,” he added.

    While the American Reinvestment and Recovery Act of 2009 stimulus package is seen as a strategic investment that may create as many as 396,000 California jobs, according to Recovery.org, the North Bay is likely to create only 10,190 jobs – and this money will go away in the coming years. Meanwhile, Marin, Napa and Sonoma counties are likely to lose about 22,000 jobs collectively before this recession ends.

    Other policy recommendations from the report include:

    • Linking firms to potential ARRA stimulus money and coordinating efforts to use AB 811 and California Employee Training Panel funding to stimulate construction, health care and other industries jobs in the North Bay. AB 811, for example, enables public/private partnerships between businesses and household property owners willing to participate in a revolving loan fund. Property owners can use their property-tax roll to finance the purchase of goods and services that make homes and businesses more energy and water efficient.
    • Form a North Bay Education/Jobs Partnership, funded by local businesses and philanthropists, as a public/private clearinghouse for local businesses, educational institutions and governments to work together on curricula, programs and job-skills matching.
    • Consider using vacant commercial real estate properties as potential epicenters of business attraction. Such space can foster the creation of an “Innovation Corridor” (from Windsor to American Canyon to Sausalito) where new businesses can incubate and be able to grow within or near the same locations.
    • Reduce or eliminate fees on new businesses that are leasing or purchasing vacant commercial space in specific, high-vacancy areas.
    • Reduce or eliminate fees for businesses that are in clean and green technology or have received federal stimulus money.
    • Engage community banks to consider alternative lending options, such as micro-financing, where banks make loans at reduced rates while taking an equity stake in the enterprise, as a mechanism for stimulating entrepreneurship beyond classic lending.

    To view the entire “How to Make the North Bay a Jobs Magnet” report, go to www.northbayleadership.org and click on Events/Previous Events.

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