‘Innovation industries’ have $8 billion impact on Central Coast economy, new reports say

Kaytlyn Leslie
·4 min read

So called “innovation industries” have a nearly $8 billion impact on the local economy and provide roughly 32,000 jobs in San Luis Obispo and Santa Barbara counties, a Central Coast economic group announced Friday.

A quartet of new studies commissioned by economic outreach group REACH examined the impact of certain high-value industries on the Central Coast’s economy.

Those include aerospace, precision manufacturing, clean tech and other technology fields.

According to a news release, REACH commissioned the reports “to support the region’s growth of these key industries.”

“These forward-looking industries are a growing part of the regional economy and primed for further expansion,” REACH President and CEO Melissa James said in the release. “These four reports provide analysis and insights to help the region’s companies, education and workforce providers, and policymakers work collectively to reach the brass ring of thousands of new good jobs on the Central Coast.”

The reports were funded by a U.S. Economic Development Administration grant, which also funded development of the organization’s “Resilience Roadmap” that presented San Luis Obispo and Santa Barbara counties’ “first-ever comprehensive economic development strategy,” according to the release. Funding also came from both counties and Bank of America.

Mechanical engineering graduate student Aaron Fielden works with an unidentified student outside the Cal Poly clean room during testing of the ExoCube 2 satellite, a collaboration between the university and NASA’s Goddard Space Flight Center. Fielden was a project manager in 2016-17 for the ExoCube 2 satellite.
Mechanical engineering graduate student Aaron Fielden works with an unidentified student outside the Cal Poly clean room during testing of the ExoCube 2 satellite, a collaboration between the university and NASA’s Goddard Space Flight Center. Fielden was a project manager in 2016-17 for the ExoCube 2 satellite.

What did tech economic impact studies find?

The studies examined the impact of four key industries on the Central Coast: aerospace and precision manufacturing, clean tech and renewable energy and traditional technology.

The studies found those industries as a whole were “poised to spur an additional 6,250 jobs across the regional economy by 2027.”

Of the three, the traditional technology industry — which includes fields such as information technology, research and development and engineering — had the largest impact on the local economy, with an estimated $3.3 billion annual impact, according to its report.

This is due in no small part to established Central Coast offices for globally recognized brands like Google, Amazon, LinkedIn, PayPal, Sonos and Zoom, according to the report.

The industry spans 13,000 jobs across both San Luis Obispo and Santa Barbara counties and is expected to add an additional 3,200 by 2027.

Cal Poly Professor John Bellardo, far right, measures a 3U satellite in the Cal Poly CubeSat Lab assisted by, from left Jordan Ticktin, a Cal Poly alumnus who works at NASA’s Jet Propulsion Lab, and Ryan Luke, an electrical engineering student from Santa Maria. Cal Poly students have designed and built 12 CubeSats that were launched into space.
Cal Poly Professor John Bellardo, far right, measures a 3U satellite in the Cal Poly CubeSat Lab assisted by, from left Jordan Ticktin, a Cal Poly alumnus who works at NASA’s Jet Propulsion Lab, and Ryan Luke, an electrical engineering student from Santa Maria. Cal Poly students have designed and built 12 CubeSats that were launched into space.

Meanwhile the aerospace, precision manufacturing, clean tech and renewable energy industries had similar impacts on the Central Coast economy, according to the reports.

Both had estimated $2.3 billion annual economic impacts, the studies found. Aerospace and precision manufacturing encompassed 9,800 jobs,while clean tech and renewable energy represented 9,300 jobs.

Both were also poised to add more than 1,000 new jobs to the area by 2027, with aerospace and precision manufacturing adding 1,837 in that time span and clean tech and renewable energy adding 1,216.

The reports noted that though most of the jobs in the above industries were centered in Santa Barbara County, San Luis Obispo County has seen “dramatic growth” in the fields in recent years that is projected to continue.

Clouds break up over the Santa Lucia Range on Monday morning as leaves fall in the Tolosa Vineyard on Orcutt Road near the San Luis Obispo County Regional Airport.
Clouds break up over the Santa Lucia Range on Monday morning as leaves fall in the Tolosa Vineyard on Orcutt Road near the San Luis Obispo County Regional Airport.

What is impact of agriculture and ag tech on Central Coast economy?

Besides its research into what it identified as “innovation industries,” REACH also commissioned a report on the economic impact of agriculture and ag tech.

According to the report, the industry encompasses 35,000 jobs across both San Luis Obispo and Santa Barbara counties. That is projected to grow by 10% by 2027 — far outpacing state and national projections of 1% and 5%, according to the release.

This showed the fields played an essential role in the regional economy, according to the release, with nearly 1 out of every 10 local jobs being in the agriculture and ag tech industry.

According to the report, the region’s “strong network of postsecondary institutions” such as Cal Poly and UC Santa Barbara are tremendous assets to helping grow the industry even more on the Central Coast.

Workers were busy putting up several acres of greenhouses next to the San Luis Ranch development and Highway 101 in San Luis Obispo on Jan. 16, 2024. About 28 acres of greenhouses will be used to grow organic blueberries by Central Coast Organic Berries. They will be available at the SLO Ranch Gourmet Market and sold wholesale.
Workers were busy putting up several acres of greenhouses next to the San Luis Ranch development and Highway 101 in San Luis Obispo on Jan. 16, 2024. About 28 acres of greenhouses will be used to grow organic blueberries by Central Coast Organic Berries. They will be available at the SLO Ranch Gourmet Market and sold wholesale.

Moving forward however, it does face some specific challenges.

According to the report, only a handful of the jobs offered in the industry pay enough to sustain a traditional household of two adults and two children.

Both counties have also seen significant outmigration of its regional workforces, the report said, resulting in “several thousand fewer workers in the region.”

“Reversing this trend will be important to the health of the Central Coast economy,” the report concluded.

To read the full reports, visit reachcentralcoast.org/key-industries.