Economic Resource Council

Nevada County Economy Profile Study

Russ Steele

Nevada County CEO Rick Haffey attended a Nevada County Profile Workshop on October 2, 2008 held in Truckee, California.  The purpose of these workshops is to better educate each county about their local economy and provide insight on how to use the profiles. The workshop was presented by Dr. David Gallo, Chico State University Economics Professor/Resident Economist and sponsored by the Private Industry Council, SEDD Corp and Citizen’s Bank.  To view the information presented, click on the following links: 

Nevada County: Trends, Forecasts, and Economic Base Industries

The Next Year in the California Economy: A Perfect Storm: The impact on Nevada County

This information is from the County Web Page.

Gil Mathew Joins ERC

Gil Mathew has joined the ERC as President and CEO. Gil was the founder and President of Benchmark Thermal, a Grass Valley export manufacturer, designing and manufacturing industrial heating elements and applications for a variety of industries from aircraft galleys to semiconductor tools. Benchmark grew from 2 employees to 60 employees over its 23 years under Gil’s direction. He sold the business with the caveat that it must remain in Grass Valley for a minimum of 7 years.

 

Latest findings on Consumer Behavior

Russ Steele

Annenberg School for Communication has been surveying Internet users and have published their lastest findings in  2008 Digital Future Project – Year Seven Report. They have published a summary of key findings on more than 100 major issues here.

The 2008 Digital Future Project found the following about Consumer Behavior:

Who Is Buying Online? -- The number of online purchasers has increased to the highest level in the history of the Digital Future Project, increasing 16 percent since 2006.
Purchasing On The Internet: Spending Per Month -- Sixty percent of Internet users age 18 and older bought online and spent under $100 a month, a large increase over 2006.
How Often Do Online Purchasers Buy Online? -- The average number of annual online purchases for those age 18 and above increased to its peak thus far in the Digital Future Project -- now more than 36 purchases per year.

How Does Buying Online Affect Traditional Retail Purchasing? -- A large percentage of online purchasers reported that their Web purchases have reduced their buying of similar items in retail stores. After a small decline in 2006, the percentage who said that Web purchasing reduced their local retail purchasing somewhat or a lot grew to 67 percent of online purchasers, up from 65 percent in 2006.

Browsing For Products: Retail Stores Vs. The Internet -- Large percentages of respondents report using both the Internet and retail stores for browsing and purchasing. Seventy-one percent of Internet purchasers said they sometimes or often browse in traditional retail locations and then buy online. Even higher percentages of respondents said they use the Internet as a merchandise browsing tool before buying in stores.

Privacy: Concerns When Buying Online -- Privacy and security online have been found to be major concerns in each of the seven Digital Future studies. Almost all respondents have reported concerns about the privacy of their personal information when or if they buy on the Internet. The percentage of all respondents who reported the highest level of concern increased in 2007, and overall concern was the highest since the first year of the Digital Future Project.

Privacy: Comparing Concerns Among Non-Purchasers Vs. Purchasers -- Although the percentage of all users who report the highest level of concern continues to be quite large, comparing Internet purchasers to non-purchasers shows that online buyers report much lower levels of concern.

Credit Card Information: Are Concerns Stabilizing? -- Concerns about credit card security when or if buying online continue to remain high among respondents in the Digital Future Project.
Although the percentage of those with the highest level of concern about credit card information increased slightly to 57 percent, the overall levels of concern have stabilized over the four most current years of the study -- and at a much lower level than when this issue was first tracked in 2001.

As the ERC struggles to develop an economic development strategy, they need to understand these changes in consumer behavior.  More people are going on line to chose what to buy and where they will buy products of interest. You can down load the full summary of the report here.

Home Construction Slows to 27-Year Low

Russ Steele

In a study done by Chico State Professor for the Nevada County Contractors Association in 2006, Construction contributed 17 percent to the local economy. The home construction industry has been severely curtailed in Nevada County and according to a recent report by the Commerce Department this week that new homes and apartments construction in 2007 was down 24.8 percent from 2006. I saw on KCRA last night that Nevada County's housing market was down only 15 percent while some of the valley counties it as down about 26 percent.  A declining market means fewer home starts.

Money News writes: For December, construction fell by a bigger-than-expected 14.2 percent. The drop in construction in December was bigger than economists had been expecting and reflected weakness in all parts of the country. Housing construction fell by 30.8 percent in the Midwest and was down 25.8 percent in the Northeast and 19.6 percent in the West. The decline in the South was a smaller 3.3 percent.

Many economists believe the housing sector will remain weak through 2008 before starting a rebound in 2009.

The important thing to remember as Nevada County crafts an economic recovery strategy, it that the Construction industry made up 17% of our local economy. That is a big chunk and it will take a while to recover, with not much chance it will get better real soon. When one of the SDA projects are approve over the next five years, it is unlikely that the construction will be done by local contractors, but by large out of town firm, just like the hospital expansion was and the Sierra College Expansion is now.

Data Bank Resources

Russ Steele

The Sierra Environmental Studies Foundation has a Data Bank where they post relevant reports on current issues being discussed by the public, or being evaluated by governments in Nevada County. Here are two examples:

Looking Beyond the Horizon: Investment Planning for the 21st Century - State of California Debt Affordability Report,  October 2007. Discussion of the the State’s debt and fiscal policy, has long term impact on local economic development planning.

Business Location Decisions and Employment Dynamics in California, 2007 by Public Policy Institute of California. Chapter Five covers intrastate relocations important to Nevada County economic development strategy.

UCLA Economic Forecast

Chuck Neeley

UCLA publishes an economic forecast periodically throughout the year.  The most recent one from September 12, 2007, is entitled "U.S. Economy A "Near Recession" Experience.  It paints the picture that California will fortunately avoid recession in the near term.  That is good news!  Here in Nevada County the picture is yet a little brighter, with predictions that the housing market may turn around and become positive again in the next 12-18 months.  As we close out 2007, there appears to be light at the end of the tunnel!  We will continue to track the economy closely.  Here is the UCLA Forecast:

http://uclaforecast.com/contents/archive/media_9_07_1.asp

Nevada County Snapshot

Chuck Neeley

The California Employment Development Department (EDD) publishes County Snapshots each year.  They are available for 43 counties and six  Metropolitan Areas (representing 15 counties) and reflect Benchmark 2006 annual average data.  The Snapshot for Nevada County is at the following link:

http://www.calmis.ca.gov/file/cosnaps/nevadsnap.pdf

Legislation - Career Technical Education

Chuck Neeley

I am a strong proponent of Career Technical Education (CTE) classes in our high schools.  In the last half century we have lost our ability to prepare the way for talented students, that are not college bound, to enter the trades.  The concept to bring back a mandatory program for high schoolers now seems to be gaining traction in California.  Following is a recent article on the legislation under consideration:

Senate Votes to Include a Career Technical Education in High School Graduation Requirements

On Thursday, June 7th, the California State Senate approved Senate Bill 672 (Torlakson) to add career and technical education to our state's high school graduation requirements in 2014.  This measure passed with a strong bipartisan vote of 33-2.  This bill is co-sponsored by the California Industrial and Technology Education Association (CITEA) and other members of the Get REAL coalition in Sacramento. SB 672 will finally ensure that CTE coursework is given equal footing with all other college-prep mandates so that students will actually have an opportunity to take these important classes. 

While this bill is controversial to some in the education community, including the Chair of Senate Education Committee Jack Scott (D-Pasadena), this bill is absolutely essential to re-establish balance in high school curriculum.  The criticism by Chairman Scott is that there are already too many mandates on our high schools and this bill is yet another requirement on an over-burdened system.  However, this is exactly the point.  The education system delivers only those courses that are mandated or required.  As such, curriculum like CTE that is not required or mandated doesn't get taught.  California's CTE system has been dismantled during the past twenty years because these courses are "electives" competing with an ever expanding list of high school graduation and college admission course "requirements." 

Bottom-line, in California education policy, we value what we require, what we fund, and what we measure.  This past Thursday, more than 80% of our State Senators agreed with Senators Tom Torlakson (D-Contra Costa) and Mark Wyland (R-Escondido) that it is time for California to move beyond rhetorical support and act upon a measure to place real "value" on CTE.

 

New Air Service - Sacramento Int'l Airport

Chuck Neeley

Beginning tomorrow, June 15, 2007, Air Canada will begin non-stop service between Sacramento and Vancouver, British Columbia. The carrier will fly two daily round-trip flights, which are timed to connect with flights from Vancouver to Air Canada's destinations in Asia, London, and the rest of Canada. This service is invaluable to the Sacramento Region as Air Canada is the second foreign carrier to offer flights from the Sacramento International Airport.

Value of Older Workforce

Chuck Neeley

If you are 55 or older, did you know that you are emerging as a "hot commodity?"  Older workers are doing a lot more these days.  They're becoming integral parts of the workforce at health care, telecommunications, financial services, and other companies.  That's because smart executives looking to the future understand that there is a labor shortage on the way in this country.  Nationally, in five years, nearly 20 percent of the total U.S. workforce will be age 55 or older, compared to only 13 percent in 2000, according to forecasts by AARP.  Please see accompanying article:  Older Workforce