COMMENTARY
California: A Diverse and Dynamic Economy
By Brian P. McGowan
As the current global economic crisis unfolds, it is important for Californians to remember that the world is watching what we do. California has a competitive advantage
in times like these. Economic disruptions such as this challenge
the status quo, thereby presenting opportunities for innovative
thinkers and new business practices. California is unmatched
when it comes to innovation and its ability to inspire new ideas,
new industries, new technologies and new ways of thinking.
Gov. Arnold Schwarzenegger often refers to California as a nation state. Its strength lies in the size, diversity and adaptability of
its economy as well as in the talent and diversity of its population.
We have the high-tech enterprises of Silicon Valley, the biotech
industries of San Diego and the San Francisco Bay area, the agricultural technology industry of the Central Valley, the entertainment business of Los Angeles—all of which make us eighth
largest economy in the world. When one sector is struggling,
other sectors help cushion the blow.
Rising fuel costs and increasing global population are creating a new opportunities for California. As our state began its
economic ascendancy with the Gold Rush, California is now
poised to get a new shot in the arm from a Green Rush—the
exploding green-tech revolution. California is on the cutting-edge when it comes to solar technology, alternative-fuel vehicles, energy-efficient products, green buildings and more.
As a state, we have demonstrated the ability to achieve sustainable economic growth while protecting the environment. In fact,
California has one of the lowest per capita greenhouse gas emissions and highest GDPs in the nation. The Governor has set a
goal of increasing California’s renewable energy sources to 20%
by 2010, and he supports reaching 33% by 2020. According to an
economic study released by the University of California at Berkeley and Next 10, California’s environmental policies will create as
many as 403,000 jobs in the next 12 years and household incomes
will increase by $48 billion.
California companies receive more investment in clean technology than anywhere else in the country. Since 1990, the green
business establishments in the state have grown by 84% and employment has doubled. Recently, Tesla Motors decided to locate
its manufacturing facility for its new fully electric Model S vehicle in California. So move over Detroit, California could be the
next Motor City.
California is also home to more than 3,000 biomedical technology companies with estimated annual revenues of $73 billion, employing more than 200,000 persons. California’s share
of biotechnology venture capital accounts for nearly half of
all biotechnology venture capital investment in the US, and
Proposition 71 committed $3 billion to stem cell research. With
these funds, we are now investing more in embryonic stem cell
research than any nation in the world. To date, 168 research
grants totaling more than $530 million have been approved.
We also have a burgeoning civilian space industry in the Mojave Desert with Burt Rutan’s Scaled Composites and the first
civilian designed and built spacecraft. California has also inspired companies like Hewlett-Packard, Netscape, Amazon.com
and Yahoo. eBay started in 1997, and today supports the livelihoods of 1. 3 million people. How many other game-changing
companies are incubating right now in a garage or laboratory
somewhere in California?
California has more than 15,000 miles of highways and freeways, 12 cargo airports and 11 cargo seaports, 18 foreign trade
zones and 39 enterprise zones, four national laboratories and
three out of the 10 NASA research centers.
The world needs California more than ever. As we lead the
Golden State into the future, we are also showing the nation and
the world how to get there.
Brian P. McGowan is Deputy Secretary for Economic Development and Commerce.
He can be reached at BMcGowan@bth.ca.gov
2009 CALIFORNIA
ECONOMIC DEVELOPMENT GUIDE EDITORIAL ADVISORY BOARD
WAYNE SCHELL
California
Association for
Local Economic
Development
LINDA D. DANIELS ELISA GRE Y
Rancho City of Fontana
Cucamonga
Redevelopment
Agency
TRICIA HINCKLEY
City of Riverside
BRIAN MCGOWAN MICHAEL BUSHEY
State of California Southern
California Edison
REX HIME
California
Business
Properties
Association
NANCY GRAHAM STEVEN
Centre City LANTSBERGER
Development Corp. City of Hesperia
KEITH METZLER
City of Victorville
