Millennial migration, growing graduate population and cost of living drive new and expanded business opportunities for the region
(From Press Release – GSEC) – Greater Sacramento Economic Council (GSEC) and CBRE today released the first-ever Greater Sacramento Talent Story report, indicating a robust talent pool and educational pipeline, and that Greater Sacramento is poised become the primary location for businesses of any capacity.
“The findings of this report demonstrate the amount of valuable talent that is available to businesses looking to expand or relocate to the Sacramento region,” said Barry Broome, president and CEO of the Greater Sacramento Economic Council. “Sacramento isn’t just a government town anymore – the city and region increasingly offers a young, educated workforce, as well as significant cost-savings that give businesses the tools they need to grow and flourish.”
“The Greater Sacramento Talent Story,” which reveals key insights on the region’s evolving workforce and assets, indicates that Greater Sacramento’s burgeoning talent base is an opportunity for employers and individuals alike. Highlights include:
- Greater Sacramento’s amenities, lower cost of living, available job opportunities and proximity to local attractions are driving high levels of inbound migration, particularly among millennials. Sacramento saw a net gain of 6,680 millennials last year, making it the third most popular city in the nation for millennial migration.
- Greater Sacramento is outpacing California and the U.S. in the growth of highly qualified workers, as residents with a bachelor’s degree or higher has increased by 9% in the past five
years. - Greater Sacramento leads the nation in the number of women-founded businesses, tied with Los Angeles at 25%.
- Sacramento was named No. 6 among the top-ranked small tech markets out of 50 major markets in North America.
- 53% of the graduate population in Greater Sacramento has STEM degrees, making it No. 5 in the West, and No. 8 among the largest 50 Metropolitan Statistical Areas in the country.
“Greater Sacramento is set up for growth in so many ways,” said Lisa Stanley, First Vice President in CBRE’s Sacramento office. “The strong labor pool, investment opportunities, quality of life, connectivity to the Bay Area — all of these factors make the region an underrated destination for workers and employers alike.”
The report also features testimonials from local business leaders, case studies, assets to residents and more, providing an in-depth look at why businesses are increasingly choosing to relocate and expand to the greater Sacramento region, why talent is moving in, and why 42% of local college graduates stay in the region.
“Our instructors are in regular contact with local industry leaders to ensure we’re able to identify workforce needs and that our programs prepare our students for the jobs of today and the future,” said Brian King, chancellor of the Los Rios Community College District. “The students in Greater Sacramento have resources, programs and advisors at their fingertips that provide them with the tools they need to be high-value members of the local workforce when they graduate.”
The full-length “The Greater Sacramento Talent Story,” can be requested here, or emailed upon request.
Other findings of interest – the report by the Greater Sacramento Economic Council and CBRE that provides compelling data demonstrating the Sacramento region’s growth in the California landscape, as well as the benefits and amenities offered by cities in the region, such as Davis, that offer unique assets for a wide variety of audiences. Some of the highlights of the report include:
- UC Davis: 56% of UC Davis undergraduates are enrolled in STEM majors.
- Women-Founded Businesses: 25% of all businesses in Greater Sacramnto are founded by women, which makes the Greater Sacramento region the leading region (tied with Los Angeles) in the nation for the number of Women-Founded Businesses.
- Millennial Migration: Sacramento saw a net gain of 6,680 millennials last year, making it the third most popular city in the nation for millennials.
- Increases in Higher Education: Those with a bachelor’s degree or higher has increased by 9% in the past five years, demonstrating faster-paced growth compared to California (7%) and the U.S (6%).
- Strong STEM/Tech workforce: Sacramento was named No. 6 among the top-ranked small tech markets out of 50 major markets in North America, with 53% of the graduate population in Greater Sacramento having STEM degrees
This area is growing and we can either plan and design for that growth or have it happen piecemeal. In the end we will be better off if we plan for it.
Or dig a moat . . . ?
Many places in the Bay Area “dig a moat”, or are surrounded by one. They do quite well.
Larger does not equal better, nor does it necessarily make a place more affordable. (See Los Angeles.)
Truth be told, agricultural mitigation efforts (which are found throughout the region, and beyond) are a form of “digging a moat”. So are urban limit lines.
Loomis recently rejected a mixed-use development (see article, below). Why is it that the nicer places are almost always the same ones which don’t pursue excessive development?
Honestly, what’s nicer – Natomas/Elk Grove, or Loomis/Davis? And, for those who prefer the Natomas/Elk Grove model, why not move there – instead of complaining about Davis?
https://www.davisenterprise.com/forum/opinion-columns/commentary-nimbyism-is-a-california-thing/
For those who don’t want to read the article, Loomis residents had to use the referendum process to overcome the support of the city’s officials for the development proposal.
Seems like officials are almost always more supportive of development than residents are. And, this extends up to the state level, as well.
Perhaps that’s indicative of a corrupted system, and/or a reflection of the type of people that often pursue office.
What does this have to do with this article?
Seems like you haven’t read either one.
My question still stands, what’s your answer?
What are the places that have dug a moat and are doing “quite well” fiscally and economically? And to what extent have the housing prices skyrocketed more than elsewhere?
And what are the environmental consequences of pushing those people to other locations?
A bit of historical context: Barry Broome was run out of Phoenix because he could not deliver on his good-sounding promises. His resume plays up his so-called achievements there, but he really presided over Phoenix underperforming in recession recovery compared to the rest of the country. And his promises of delivering a tech boom resulted mostly in just low-value back-office call centers and the like.
The man is good at self-promotion though I’ll give him that.
tje
On the other hand, a recent Bee article shows that the Sac region is growing, it’s moving into the top 15 in terms of start ups and Greater Sacramento is given credit for that progress. So we can look at a decade old situation in Arizona or a current one in our backyard to assess Broome.
What does this have to do with this article?
Hey – I “value” those call centers. Just remember that pressing “0” is not an option.
Press “1” to take an irrelevant survey (e.g., regarding how “polite” the agent was), after negotiating this answering system (which is actually what annoyed you, well-before reaching an agent).
I also “appreciate” incoming calls, disguised as local numbers.
Cites, or off-topic? Or are you a “protected class”?
Am awaiting moderation…
Good call, Alan…
It’s berry (sp?) likely I should think more than twice about the beary (sp?) likely possibility of ‘poking the bear’, before baring my barely tolerable criticism of certain folks’ bare-as***d untruths/distortions… I’ll try to heed that advice.
Rik…
Any cites? Or just stringy pasta? I ask as some one not impressed w/ his CV, but less impressed with yours…
Just observing… and awaiting moderation… apparently you are a “protected class”…
California Department of Finance projected an annual population growth rate for Yolo County of about 1.35% per year for the next two decades from a base period of 2010.
http://www.dof.ca.gov/Forecasting/Demographics/Projections/
The current population as of 2017 was 219,116. Using their projections, Yolo County would add about 74,000 people over the next two decades.
With the current population distribution of the cities and unincorporated areas of Yolo County, that would be an increase of about 18,000 to 23,000 people for each of the three cities (Davis, Woodland, and West Sacramento), a couple thousand more in Winters, and about 9 – 10,000 people added in the unincorporated areas, by the year 2040.
For every 10,000 people, at the US average of 2.58 people per household, you need about 3500 single-family homes. Obviously, multi-family housing at greater densities allows more population growth with a smaller footprint, but skews the occupancy toward certain demographics.
A city can plan for how it grows. It can constrain growth by limiting the land available. What cities increasingly cannot do is constrain growth by limiting densities or putting onerous restrictions on how housing can be built. The state is increasingly mandating that cities plan for their share of regional growth, and there is no question that the Sacramento Metropolitan region is poised for growth of population, business, and jobs.
The current planning process of Davis is leading to a city that is both older and younger than average, with less business activity and less sustainable finances than every other city in the region.
In my opinion, adding a subdivision with housing geared to families would broaden the demographic base of the city. It would help the schools and provide a better customer base for existing and potential retailers. Adding sites for business development would broaden the job opportunities and tax base.
Allowing moderate, planned growth is what cities do to remain solvent. If Davis doesn’t do this, it will gradually have to keep increasing taxes to cover the costs of existing infrastructure and provide what the citizens want. Or the city will have to reduce services, and if you look at the budget you’ll see those mainly involve public safety and parks and recreation. Pushback from the public to reducing services can be substantial.
Those who advocate severely restricted growth of housing and businesses are basically advocating for steadily increasing taxes and reduced services.
Growth does not have to be rapid. Planning now for future regional growth would enable the community to include the features Davisites like to see in their housing developments.
That’s what we’re sometimes told. But, it’s actually just a slower version of a Ponzi scheme. And it’s still not sustainable, even if it simply takes a little longer for that to become evident.
Demographics don’t stay the same, over time. Older generations die-off, to be replaced by younger generations. Even if areas that are considered “more expensive”. (However, family size/number of children is shrinking.)
People have to live somewhere, Ron. Your answer always seems to be “somewhere else.”
And no, it’s not a Ponzi scheme. Not literally, and not metaphorically. It’s not even a pyramid scheme. Both rely on new investors fully covering the payouts to earlier investors. Infrastructure and overhead in the city are paid for by both new and existing “investors.” So you are mis-using the term.
You’re putting forth two entirely different arguments. I just highlighted the Ponzi-scheme aspect of your comment, for now. You’re not alone in putting forth this type of argument.
For example, relying upon new/continued development to pave the city’s roads (while increasing traffic on those same roads) is a Ponzi scheme. Let’s call it what it actually is, instead of trying to hide it. Even if you think this is a reasonable approach.
Truth be told, there’s a structural problem if cities continue to look for fiscal profits from never-ending development. (This also becomes more “evident”, during recessions – such as the one that we’re overdue for.)
Not true. Neither is a Ponzi scheme. They don’t “rely on continued development to pave the city’s roads.” All existing residents also pay for them. So you are continuing to misuse the term.
Here’s what you said:
Again, this is just a slower-motion Ponzi scheme.
If it makes you feel any better (or less defensive) you’re not the only one who puts forth this type of argument (or denies what it actually is).
Nope. It’s not a Ponzi scheme. Look it up. Ponzi schemes rely entirely on new investors.
Remaining solvent means increasing revenues from a variety of sources, including existing “investors” (taxpayers). They can pay more sales tax from having more retail choices. If property turns over, it increases the taxable basis. If there are new houses and new businesses, those increase the tax revenues. But existing “investors” also continue to support the services. Economic development can reduce the increased burden on them.
The city’s costs are increasing. The city’s main expense is the cost of payroll. Unless you feel city employees should never receive pay increases, that will require increased revenues.
Cities that don’t grow have to reduce costs or reduce services or increase taxes, or some combination of those things.
Definition of a Ponzi scheme: “a form of fraud in which belief in the success of a nonexistent enterprise is fostered by the payment of quick returns to the first investors from money invested by later investors.”
There is no fraud here.
https://www.sec.gov/fast-answers/answersponzihtm.html
If you’re hung up on the word “fraud”, that’s probably the least of the problems. (Although some have pointed out related claims that might be described that way.)
It’s not sustainable, nor is it reasonable. Do we ultimately live on a finite planet, or not?
Ron
The problem is that a city can’t stay static and be vibrant. What’s happening in the Midwest a great example where communities have tried to hold on to what they had rather than move forward and instead many are losing almost everything. On the other hand, communities on the coasts have been more dynamic and their residents are much better off economically and socially, and they are clearly more satisfied with their present situations.
And this is the dilemma that Davis faces. The growing number of empty storefronts around town despite a robust economy is a symptom of our stagnation. That stagnation will lead eventually to a fiscal crisis because we will lose economic vitality. Your underlying assumption is that UCD will continue to float our boat, but that need not be the case, especially if it develops more housing and communities like West Village on its campus.
As to your misclaim that younger people will replace older people, that is not the case if a 75 year old buys the house of a deceased 85 year old because only the 75 year old can afford it (and the community is no longer attractive to a 35-year old couple). That really doesn’t change the demographics of the community.
Terrific – put the innovation centers in the Midwest, instead. Oh, wait – didn’t they try something like that, already?
https://www.theverge.com/2019/5/13/18565408/foxconn-wisconsin-innovation-centers-factories-empty-tax-subsidy
“Wisconsin governor says Foxconn is again likely to miss job targets”
https://www.cnbc.com/2019/07/08/wisconsin-governor-says-foxconn-is-again-likely-to-miss-job-targets.html?__source=twitter%7Cmain
That’s a sign of the decline of retail, especially small retail.
That’s a highly questionable assumption. Are there lots of 75-year olds, looking to move from one mediocre house to another to live out their last 10 years? I’ve seen significant numbers of new families in Davis (and in other so-called “expensive” communities), in existing neighborhoods. However, it is likely true that they are wealthier (and more successful in that manner) than previous generations who occupied the same house.
I already “looked it up”, as noted above.
Your inability to see the obvious comparisons (e.g., relying upon a steady stream of never-ending “investors” to bail out cities) is astounding.
Advocating for this approach is one thing, but let’s be honest regarding what it actually is.
Actually, isn’t this the premise of WDAAC? But, at least that development is specifically designed for that population (and is supposed to “free up” the vacated houses for families, in Davis).
Once again Ron has gotten us way off topic. Back to the issue at hand – economic development.
Anyone else stunned by the 56% figure for STEM. And the key question: where do they work once they graduate? Answer: not here according to the presentation from two weeks ago.
Every comment I’ve made references this topic. Some (including Don) have made extraneous comments.
I have not seen a single comment of yours that addresses the report.
“The findings of this report demonstrate the amount of valuable talent that is available to businesses looking to expand or relocate to the Sacramento region,” said Barry Broome, president and CEO of the Greater Sacramento Economic Council.
Well, the first thing I noted was that there’s at least one other city (regionally), and many more within the general area (as noted in the article I initially cited) that apparently reject the type of advocacy put forth in the report.
You’re still on one note
Apparently, it’s a note that plays well in some communities.
One of the “casualties”, regarding the pursuit of economic development in the region:
Interestingly, the title also states that “help” is on the way, but primarily just notes a bunch of “ideas” for doing so. The same ideas that have been promoted for decades, but somehow fail to materialize while still pursuing more development.
https://www.sacbee.com/news/local/sacramento-tipping-point/article234556102.html
Actually this is the downside to the lack of affordable housing in the Bay Area, not to the pursuit of economic development.
Economic development is what caused Bay Area housing prices to rise to their current levels, and created a lot more traffic.
Not everyone “wins”, under such circumstances. In fact, it might be viewed primarily as a “transfer” of wealth to those at the top. With more “losers”, than “winners”.
Some of the “economic losers” might migrate toward the Sacramento region. But, I doubt that this would make a good marketing slogan.
Also note that the article I posted discusses “super commuters” – those who are willing to commute very long distances to obtain the type of housing that appeals to them.
As long as most communities still welcome sprawling developments, it won’t matter how many expensive lofts are created in downtown areas.
Regarding the type of development that California pursues, the answer is “both”. The overall system is too corrupted to change in any significant manner.
The state is encouraging infill, and is also encouraging and allowing sprawl.
That’s why I’m (somewhat) encouraged when any individual community takes steps to decide its own path.
Like Measure R, for example?
“Are there lots of 75-year olds, looking to move from one mediocre house to another to live out their last 10 years?”
Some grandparents from Portland bought a house down the street to be nearer the next two generations. They bought a five bedroom 2.5 bath house that now has two people living in it. I don’t know if they are in their 60’s or 70’s but this does happen in Davis.
Well, then where did those “two people who may be in their 60’s or 70’s move from? And, is that vacated house also now occupied by old people?
Is there an unlimited supply of old people? (Actually, the state as a whole is “graying”.)
Oh – I see that they moved from Portland, another city that has been dealing with growth pressures and rising housing prices. Maybe occupied by a family, now.
Actually, Portland is a very nice city. Superior to anything in the Sacramento region, in my opinion. And, has been drawing a lot of millenials (including those from California). Truth be told, the entire Northwest is superior to (much of) California. Unless one prefers overpopulated, hot, dry, flat, floodplains that are better-suited for farmland. (Yeap – both “dry” and a “floodplain”.)
“California Department of Finance projected an annual population growth rate for Yolo County of about 1.35% per year for the next two decades from a base period of 2010.”
Old data, we actually need the county to grow faster because UCD is growing faster than anticipated and the economy overall is much better now.
“In my opinion, adding a subdivision with housing geared to families would broaden the demographic base of the city.”
Welcome aboard the “this is what I’ve been saying for ten years” train Don. Better late than never.
My priority for the last 12+ years was rental housing. That’s how long it took to break that logjam. Until that happened, single-family homes had to wait in line.
We should have done both at once.
Its only a Ponzi scheme if you have an infinite time frame since eventually the sun burns out but people don’t live forever. So when do you expect the collapse 1, 10, 100, 1000 years?
Of course the City of Davis does have a structural deficit that keeps falling farther behind with each passing year. If you want to argue that trying to grow our way out of it won’t work I think you ought to come up with other ideas about resolving the deficit.
“And what are the environmental consequences of pushing those people to other locations?”
This is where my original remark of we can plan for it or have it happen piecemeal is coming from. A recent NY Times article “Nobel Winning Economist Goes To Burning Man” crystallized, in my mind, our local dilemma with this passage:
“Urbanization in the developed world has largely come to an end; nearly everyone who would move from farmland toward cities already has. This century, the same mass migration will run its course across the rest of the world. And if no one prepares for it — if we leave it to developers to claim one field at a time, or to migrants to make their way with no structure — it will be nearly impossible to superimpose some order later.”
They’re not being “pushed” to other locations. They choose to do so, to get the type of house they prefer (in communities that are more than willing to accommodate them). (See article I posted, which mentions “supercommuters”).
There is evidence that birthrates actually fall, when housing is limited. Regardless, this is a battle that has been fought one community at a time. (“Think global, act local.”) There’s no way to control what the world at large does, let alone what places like Woodland, Elk Grove, and Natomas do.
Development interests are still largely in control, in California and beyond. To pretend otherwise is beyond inaccurate.
Regarding your (following) citation, I couldn’t agree more. But, I seem to view it quite differently than you do:
Perhaps most importantly (in reference to the subject of this article), economic growth is the driver of population growth and development in a given area.
One would need blinders to ignore this fact. There’s plenty of examples to prove it.
“Fiscal profit” (for cities) is not guaranteed as a result of private development, nor is it the purpose of such development (even if it’s constantly “sold” that way).
And in the case of housing in particular, the results are generally “fiscally negative”, in the long run.
Actually, for women, improved economic circumstances and access to family planning are key to significantly lowering birth rates. This has been known for at least 25 years.
Ron G. That may be true at a global level, but global population growth does not have much to do with such pressures at a local level. (Local pressures are almost entirely the result of decisions regarding economic development, in one form or another.)
It’s going to be a very long time (if ever) before global agreement is reached regarding population and development. In the meantime, there is evidence that local birth rates are actually connected to housing availability. There was an article regarding this phenomenon, in regard to San Francisco. (This makes logical sense, as well.)