The strong economy experienced by Tri-Valley businesses in 2019 is likely to continue in 2020, according to a recent report from Beacon Economics LLC, one of California's leading economic research and consulting firms. In the Winter 2019 issue of Beaconomics: An Economic Forecast for the US and California, the firm predicted "2% plus real growth in 2020, and up towards 2.5% in 2021," for the United States as a whole and continued strength for California and the Bay Area.

"California's economy reached a number of significant milestones in the most recent quarter," according to the report. "The state's unemployment rate dipped to 3.9%, which represents a new record low, and employment and wages both reached all-time highs. The longer the current expansion persists, the closer we are to the next recession, but business cycles do not die of old age, and at present, there are few signs of a slowdown in the state's economy."

As the report notes, California's economy has added 308,000 jobs since October 2018. That is equivalent to a 1.8% year-over-year increase, which exceeds the nation's growth rate of 1.4% over the same period. "This rate of growth is well above the state's long-term employment growth rate, which has averaged 1.2% per year since 1991."

In 2019, the San Francisco Bay Area provided the most impressive performance within the state, according to Beaconomics. "Job growth in the Bay Area was remarkable, especially given the region's size. Together, San Francisco, San Jose, and Oakland added jobs at a rate of 3.0%-more than double the national rate-and accounted for one-third of California's job growth over the past year."

Positive Business Outlook

The San Francisco East Bay and Tri-Valley regions also experienced a strong economy in 2019, and indicators suggest that strength will continue in 2020. Unemployment is at record lows, jobs are abundant, and there is a lot of continued business growth, notes Stephen Baiter, Executive Director of East Bay Economic Development Alliance.

"We still see an economy that is doing very well on balance," says Baiter. "The East Bay is starting to see more and more of a trend where the growth in San Francisco and Silicon Valley has really spread into our region." The growth in the region has been shared across a wide number of sectors; manufacturing is one of the sectors that has done well, according to Baiter. "There is a real diversity in our manufacturing base here. We are not tied to a single industry or even two or three industries. That in and of itself gives us more resiliency than other regions."

Businesses in the City of Pleasanton, including those in Hacienda, have benefited from the strong local economy as well as the strong regional economy. "Last year the City of Pleasanton saw continued, positive growth for our companies and expect 2020 will bring yet another year of steady, measured, positive growth," says Pamela Ott, Deputy City Manager, who oversees economic development for Pleasanton. "That's a very good trend for the city. It means that the companies that are here are finding over time that Pleasanton has been and remains a place in which they can be successful doing business."

Investing in the Future

While 2020 is expected to be a strong year economically, some in the business community have concerns about the cost of doing business, the cost of living, the cost of talent, and a number of other factors, according to Baiter. "The economy is definitely still an upbeat picture but it is also one that has some caution flags."

Worries about the region's ability to sustain its growth are not new. Recently Tri-Valley business leaders joined together to address those issues. As Stephen Lanza, Chairman of Innovation Tri-Valley Leadership Group, explained to Hacienda Pulse in November, "with the continued economic growth in the Tri-Valley, it is critical that we protect the social and economic environment we are part of. Key to this is the development of a holistic strategy and plan to support the amazing quality of life we have, the immense educational advantage our workforce has, and the economic engine that exists, all while supporting those who struggle with the lack of adequate infrastructure."

Last year Innovation Tri-Valley Leadership Group and the Bay Area Council Economic Institute joined with regional government officials and local business leaders to begin developing such a plan. They are investing considerable time, effort, and funds to create this strategic document. The 2040 Innovation Tri-Valley Vision Plan, as it is called, is intended to become a regional roadmap for creating a secure and prosperous future for the Tri-Valley.

The City of Pleasanton is also making new investments in the city's economic future. In keeping with the city's 2019-2020 Priorities Work Plan, the Office of Economic Development will be involved in two projects to benefit local businesses. The first project is enhancing a coordinated business support plan to help foster local economic growth. The business support plan is intended to encourage residents and businesses to support local companies of all types in all industries, educate businesses in how to work with the city, and implement local purchasing practices.

The second project is developing a new program to support and expand the growing life sciences industry in Pleasanton. "We want to continue to expand the life sciences industry in our community," notes Ott. "It will be my job to lead the city's efforts as we continue to support those companies that are here and attract new life sciences companies to Pleasanton as they take advantage of the productive environment we've built."

Another type of economic investment will occur on March 26, 2020. On that date the East Bay Economic Development Alliance will present the East Bay Innovation Awards at Oakland's Fox Theater between 5 and 8:30 pm. This awards event will be an opportunity to appreciate innovative companies that contribute to the area's strong economy. The celebration also provides attention to outstanding companies and organizations to help increase their market strength and position them for investment and partnerships.

"The event puts a spotlight on the fact that the East Bay is a hub of innovation in its own right," says Baiter. "The East Bay has companies in everything from advanced manufacturing to life sciences to technology. There are companies doing interesting things in the built environment around engineering and design. This event helps to showcase both established and up-and-coming businesses that are doing interesting work in this space."

For more information about Beacon Economics LLC, please visit Beacon Economics LLC.

For more information about East Bay Economic Development Alliance, please visit www.eastbayeda.org.

For more information about 2040 Innovation Tri-Valley Vision Plan, please visit www.innovationtrivalley.org/partners/2040-info.

For more information about the Economic Development Department of the City of Pleasanton, please visit www.cityofpleasantonca.gov/gov/depts/ed/default.asp.

For more information about the East Bay Innovation Awards, please visit www.iawards.eastbayeda.org.