By Chen Yao, SCVEDC
Over the years, the annual Economic Outlook event has become the premium economic forum dedicated to the Santa Clarita Valley. The 2016 edition, jointly hosted by Santa Clarita Valley Economic Development Corp. and College of the Canyons, took place March 18 and attracted more than 350 movers and shakers hailing from business, government, and education segments. During the half-day event, the participants not only received the first-hand data and expert opinions on the region’s growth prospects, but also had ample opportunity to network and interact with their fellow attendees.
Economic Development & Community-Based Training
Holly Schroeder, President and CEO of SCVEDC, opened the forum with a short speech in which she thanked the impressive roster of event sponsors, talked about the missions of the organization and introduced a new and well-received feature – on-site instant polling. According to Schroeder, Santa Clarita is poised for business growth because it has new, state-of-the art industrial development under construction – “nearly 2 million SF will be under vertical construction this year, and with existing entitlements there is an additional 5M SF in the pipeline.” In addition, she promised increased focus on Business Retention, Community Marketing, and Economic Information & Research, of which the Economic Outlook forum is a great example.
Dr. Dianne Van Hook, Chancellor of College of the Canyons, also made a short speech. She pointed out that as one of the leading community colleges in California, the College of the Canyons was recognized for its leadership in correlating education with economic development, job retention and job creation. While reaffirming the college’s commitment to innovation, she asked for the community’s support as the campus gets ready to expand so as to accommodate increased demand for further education and training.
The Current State of Filming in California
The first keynote speaker was Amy Lemisch, Executive Director of the California Film Commission, which oversees all of the state’s efforts to facility motion picture and television production in California. According to Lemisch, the Motion Picture Industry is the fifth largest employer in Southern California. With diverse filming locations, 315 sunny days per year, 800 miles of scenic coast, it is no wonder that Southern California has long been the largest base for acting talent and highly skilled film technicians.
In recent years, other states and countries have created diverse incentive schemes to lure film and TV productions away from California. In reaction, the state of California has enacted a Film & TV Tax Credit in 2009, with $100 million per year, and the program was expanded to $300 million in July 2015. According to Lemisch, the program has yielded positive return on investment: for every $1.00 of tax credit issued, $1.11 is returned to state and local governments. In Santa Clarita, since the City Council approved the Film Incentive Program in 2009, the city has provided $340,000 in refunds to 80+ productions and has saved productions more than $170,000 on Sheriff services.
Economy: US Strength Offsets Slower Global Growth
Mark Vitner, Senior Economist at Wells Fargo, followed with an engaging presentation on the key domestic and global economic trends. Globally, slower growth in China is weighing on other economies and pushing the value of dollar higher, and this presents a threat to US exports and corporate earning. However, Vitner sees strong domestic demand and is forecasting 2 percent growth for 2016.
In California, Vitner pointed out that high tech job growth has slowed in recent months, and he cautions that a slowdown in this segment could have far-reaching effects. In the current situation of lower oil prices, Vitner noted that California has fared better than many other regions, thanks to the state’s well diversified economy. Overall, Vitner sees the economy better for consumers than producers – regions exposed to agriculture, energy, mining and manufacturing are seeing conditions weaken.
Santa Clarita: Still Golden
For Santa Clarita Valley, 2015 marked another year of consistent and firm job growth (+3.4%), building on a positive trend that first started in 2011. According to Mark Schniepp, Director of California Economic Forecast and the third keynote speaker, this positive growth trend means that the vacancy rates for office (12.9%) and industrial space (2%) continue to decrease. On the residential side, apartment rent is expected to increase by 16% this year ($1900+ per month) compared to 2013 and medium home price for existing homes increased even more rapidly – by 37% from 2012 to 2015.
According to Schniepp, the unemployment rate for the Valley economy is estimated currently at 5.3 percent – nearly full employment. Consequently, if employers are to grow, they will need to attract more workers into the area. Unless housing is made available, traffic on the highways will only become more congested over time. More industrial and office projects also need to start to sustain the demand for the future growth of employment.
The half-day event also consisted of a luncheon for top sponsors, who had the opportunities to interact with keynote speakers and a post-event cocktail reception for all attendees. At the successful conclusion of the 2016 event, we would like to take this opportunity to thank Wells Fargo for being the exclusive presenter of the event, and International Airport Centers, Henry Mayo Newhall Hospital, KKAJ, Newhall Land, Poole & Shaffery and Spirit Properties for being the platinum sponsors of the event. For a complete list of our sponsors, please click here.