Reporting

October 19, 2012 by Justin Ewers

The new, new economy on California’s Redwood Coast


The Carson Mansion in Eureka, CA, built by lumber baron William Carson. Traditional jobs like extraction have shrunk while
information sector jobs have boomed in the region. (Photo credit: 
Pamla J. Eisenberg via Flickr)

As recently as a decade ago, the sprawling redwood north of California, a region the size of Connecticut and New Jersey combined, had limited broadband access, difficult transportation challenges across hundreds of miles of mountains, and a generation of workers who found themselves tempted to tell their children to move elsewhere to find good jobs.

A region that relied for decades on the timber and fishing industry was seeing those traditional jobs steadily disappear. In 2012, there were less than half as many timber industry jobs in California's four northernmost counties—Humboldt, Del Norte, Trinity, and Mendocino—as there were in 1990.

The economic challenge facing this region might not seem to have much in common with the rest of the state, at least not at first glance. But that’s where the Redwood Coast’s story starts to get interesting, as this rural part of the state is beginning to show signs of an economic comeback similar to others taking place across California.

"We're seeing real indications of a 10-year renewal, and we're continuing to diversify our industry mix," says Kathy Moxon, director of Redwood Coast Rural Action, a group founded in 2002 to bring together a network of leaders from across the region who have developed a targeted agenda for expanding the region's economy.

RCRA started with basic infrastructure, building on the work other groups had started by focusing on increasing broadband access across the region's four mountain counties and improving transportation options for a population spread out over almost 11,000 square miles.

In 2010, the region got its first broadband line running north-south; last year, a provider established a line running east-west. This redundancy proved critical to maintaining services the rest of the state takes for granted.

"Businesses here had really been struggling with that," says Moxon. "We'd have times of the year when a contractor would cut a line by digging a ditch or there'd be a fire on a pole—you know, rural stuff—and it would knock out credit card service for days."

The region has built on the foundation of more reliable infrastructure to develop a regional approach to economic growth,one that acknowledges that traditional industries are no longer going to be the foundation they once were.

"When we first started thinking as a state about economic strategies as regions and industry clusters, Hollywood got 'entertainment,' and we got 'wood.' Just 'wood,'" says Moxon. "Well, thank you very much. Even though wood is still a big piece of our economy, it's definitely not our main employer."

So, what is? You might think the Redwood Coast would build its economy around tourism, but the region has shied away from putting all of their eggs in that basket, wary of the tourism industry's low wages. The average salary for all industries in the region is just below $30,000. For tourism jobs, it's only $13,685.

Instead, the main drivers of the new Redwood Coast economy aren't so different from the knowledge-sector jobs in more urban areas. The fastest-growing area? Management and innovation services.

"That's basically a fancy name for packaging and selling information that people who live here have," says Moxon.

From architects and engineers to consulting firms on environmental restoration and tech outfits with expertise on water systems, the region has seen a boom over the last decade in the knowledge sector. There are nearly 2,500 management and innovation services jobs in the region today—about 70 percent as many people employed in its entire forest industry. Manufacturing is even picking up, with a range of new companies building products to support businesses in markets from hydroponics to solar-based artificial growing systems.

These new economy jobs are driving up salaries and changing the face of the region. The rural north has seen 37 percent job growth in six industries identified as targets of opportunity, ranging from health care and specialty foods to building and systems construction. This compares to a 4 percent rate of growth for the rest of the region's economy.

Today, these target industries are contributing almost 40 percent of the jobs and over half of the region's wages. "The numbers really show these are the right industries for us to focus on growing," says Moxon.

The challenge for the Redwood Coast isn't just sustaining this growth, Moxon says. It's reminding residents this extreme makeover is really happening.

"The challenge for a rural area economy is keeping people focused on the plan. There's a temptation to give up because they see no big employers," says Moxon. "We're not going to have a business come in with 100 employees, that's just not going to happen."

Instead, the Redwood Coast is doing something far more sustainable in the long-term: Building a new economy—across multiple sectors—from the ground up.

The California Economic Summit shares RCRA's commitment to a plan of action that includes: a focus on regional strengths, targeting of "sector clusters" for growth and opening up more access to capital, one of the biggest priorities for rural businesses. Follow the Summit's progress with these and other action areas on the Summit Progress Tracker

Categories: Innovation, Jobs, Small Business

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