Commentary: Additional investment and support needed for California’s regions to rise together

This editorial was originally published in the Bakersfield Californian.

By Lenny Mendonca and Kate Gordon

Coming out of the recent presidential election, we’ve heard this common refrain: “People just don’t see themselves in this economy.” Despite historically high wages and low unemployment rates, the felt experience of many Americans is not one of opportunity and access, but one of struggle.

California is no different. While the state continues to thrive in terms of statewide GDP — we’re now the fifth largest economy in the world — there are real disparities across regions and racial groups in how those top-line numbers are reflected in reality.

It’s critical that California address these regional disparities head-on. That’s why we were excited to see the governor embark on his recent tour to highlight the regional economic planning done through the California Jobs First program.

We helped launch California Jobs First’s predecessor work, Regions Rise Together, when we led the Governor’s Office of Planning & Research and Governor’s Office of Business & Economic Development in the early months of Gov. Gavin Newsom’s first term.

Key to those efforts was the notion that California’s economic development strategies must reflect the economic realities facing our state. In 2019, a core reality was rising inequality, especially between inland and coastal California. In 2020, the economic shock from COVID-19 underscored our overdependence on foreign supply chains and imported manufactured goods. Today, adding to those challenges is the reality of increasingly frequent and severe climate shocks that threaten our homes and businesses — wildfires, extreme heat, flooding and related increases in electricity and insurance prices.

The plans recently released by each of the state’s 13 California Jobs First regions reflect the same principles we laid out when we began this work more than five years ago: to recognize the geographic, demographic and cultural diversity of California and to drive a more sustainable and inclusive model for economic development.

Regions up, not top down.

Now that the plans are submitted, the hard work begins: turn priorities into action and create high-quality jobs, all while moving toward a more sustainable, resilient and inclusive economy.

For the regional plans to be successful, they need long-term support from the state and access to private investors.

Success cannot depend on the California Jobs First initiative alone — it requires a holistic approach to economic development that integrates programs across state, regional and local governments, and truly aligns our state’s values with our economic realities.

Even after cuts to the California Jobs First program, California officials estimate that more than $4 billion is spent annually on economic development across seven agencies, and even more from federal programs. Coordinating those streams to catalyze regional efforts will take ongoing cross-agency efforts by the Jobs First Council, as well as regional and local governments — the true implementers of most economic strategies.

Success will not happen without private investment. Sustained economic development is never fully government funded, especially in California, where the budget is constantly shifting based on each year’s income tax receipts. Building an inclusive economy that creates broadly shared prosperity requires active engagement from companies, which should be both job creators and economic growth drivers, and also engaged and active members of their communities.

CA FWD has been involved in supporting regions individually and collectively through the work that started in 2019 and up through today. We currently support regions with connections to both public and private investors through a set of “Investor Exchanges” we launched at the California Economic Summit in October. In January, we are beginning a project to build a clearinghouse and set of toolkits to support companies and communities pursuing individual projects — to ensure those investments create tangible, local benefits in every region of California.