Advocacy Blog

The Great Recession and the slow recovery have still not broadened the horizons of political and media leaders who think small. One might expect that local business leaders would eagerly embrace practical ways of growing the economy and jobs at low cost. But the idea of growing export sales and jobs by companies operating in the San Diego region gets very little attention, in part because too many still see the region as having an insular economy connected to the global arena only through the Navy and a handful of high-tech firms.

And, curiously, a bit of ill-directed populism has emerged that makes practical trade advocacy into a risky proposition for these leaders. That’s the charge that spending on travel to champion our firms is simply junketeering and pork barrel spending.

To appreciate how misguided that notion is, take a fresh look at the area’s economy. Most regional leaders have no idea of the role that exports play. San Diego County exports are worth almost $16 billion per year. By comparison, San Francisco regional exports are about $20 billion. Both estimates exclude revenues from service exports that would substantially increase the totals.

San Diego County’s figure accounts for almost 10 percent of the regional GDP.

That volume of exports supports about 96,000 jobs, or about 7.3 percent of our jobs when the regional economy is at full employment.

Exporting is a growth accelerator. We know that jobs in export firms export pay higher wages on average (about 7 percent more in manufacturing, for example). That’s because exporting usually involves goods and services from firms with more highly skilled workforces. And exporting, for a variety of reasons, boosts productivity, enabling higher wages. Just as important – small- and medium-sized export firms, so prevalent in San Diego County – tend to increase revenues and jobs faster than their counterparts in the same industry.

There is room for the region to grow exports in the future. The Obama Administration has made a major commitment to doubling U.S. exports in the next five years, thereby adding 2 million jobs. The U.S. Chamber of Commerce has endorsed this as a feasible goal. The question is which regions in the United States have the will to seize opportunities opened by the initiative? San Diego is doing reasonably well in exporting, but we are still not punching our weight. The situation won’t improve through wishing and hoping.

Top executives and elected officials must shape a compelling export vision and policy for the San Diego region. There is increasing knowledge and skill intensity in other U.S. and global markets competing for trade and investment. How do we gather the collective expertise and connections to position our region for global market success? How do we drive access to credit for San Diego exporters? An international trade vision and policy that San Diego’s leadership buys into and delivers on can spawn new jobs and protect existing ones.

Public debate over international trade continues to swirl. Much of this is focused on U.S. trade policy with China, probably one of the most complex and exciting places to do business – and one with diametrically different cultural and business practices from those in the U.S.

Given its geographic position, San Diego County has unparalleled opportunity to increase economic development and jobs through international trade, foreign investment and tourism. Consider that the Chinese acquired more U.S. assets in 2009 than Chinese assets acquired by the U.S.

How does a San Diego County company knock on the doors of high-level Chinese government officials? How does it gain credibility in the eyes of potential Chinese business partners? How does a city or region like ours gain publicity in Chinese media for the assets and opportunities it offers?

Perhaps the hardest thing to grasp for San Diegans, who prefer to keep government “out” of business affairs, is that they have to let the Chinese government “in” to get anywhere. As counterintuitive and unpopular as it seems, our business delegations must pull elected officials out of their hats – and the higher the official, the easier the access. The Chinese – and business leaders in many other countries – take this as a sign of commitment and respect from companies and their home regions. The current U.S. Trade Representative, Ron Kirk, served as the Democratic mayor of Dallas. and its surroundings. Every year he made several international trips to build the markets, and good jobs, of Dallas and its surroundings to great success and the applause of union and business leaders alike. In short, commercial advocacy for exports and jobs should be a bipartisan agenda for this region.

San Diego and California political leaders must advocate on the ground in other countries to demonstrate the long-term commitment of our region to theirs. Unfortunately, they are bombarded with intense criticism for their efforts, which keeps many from playing the vital role they should to position our region.

Finally, our region must be committed to providing a backbone of resources to our exporters. Global connections, educational forums, advocacy, greater access to credit and trade-related infrastructure are some of the essential tools for global market success.

There is an enormous opportunity for this region, but it’s going to take elected officials and business leaders working together.

So, here’s a vision for 2015 for you: The San Diego region doubled exports to $32 billion and supported many more jobs, ranking it first among U.S. metropolitan areas in terms of export growth.