Central Coast Economic Forecast: Housing is crucial to SLO County’s economic growth
By Stephen Ellison
Special to the Business Times
Economic growth in San Luis Obispo County has slowed compared with growth in neighboring counties, as well as statewide, and lack of housing is a key reason, according to economists at the Central Coast Economic Forecast event Nov. 6 in San Luis Obispo.
While there have been positives in recent years – rising household incomes, gains in tourism and continued operations at the Diablo Canyon Power Plant – SLO County’s gross domestic product (GDP) has lagged since around the mid-2010s, according to data presented at the event. Before that divergence, the county’s GDP was on the same gradual trajectory as California’s.
Some of the bad news includes a shrinking labor force, stalled population growth and declining small businesses, according to Niree Kodaverdian, a research manager with Beacon Economics. Kodaverdian and her colleagues agreed there is potential for greater economic growth in the years to come if more housing is built.
“At current prices, (SLO County) has a shortage of homes its workforce can afford,” she told the audience at Alex Madonna Event Center. “So, that ultimately means building more housing, which is going to put even more downward pressure on price growth and make housing more affordable for its workers.”
Melissa James, president and CEO with REACH, agreed, saying you want to create jobs and economic opportunities so more people have the opportunity to build a life and a future career here.
“They can’t do that if they don’t have a place to live,” James told the Business Times. “So, the opportunity goes with the people. If people have a place to live, the jobs are being created for them to be able to thrive here. We as a region and as a community need to be invested in an opportunity for people to live here, then the trickle-down effect of that is that they are powering the future of our region and our economy.”
In her presentation, James outlined a positive outlook for SLO County after significant large investments in the past year. Those included four SLO County companies landing acquisitions and contracts totaling $1.6 billion, as well as French Hospital and Adventist Health combining on more than $700 million invested in multiple facilities across the region.
Rather than forecast, James opted to “place bets” on future growth. She is betting on expansion at Vandenberg Space Force Base, a new spaceport in Paso Robles, the state extending Diablo Canyon operations through 2045 and 10,000 new homes by 2030.
“It’s within reach; it’s something we could do if we leaned in and made those decisions,” she told the audience. “So, what is it going to take when a project comes before a council? That the people making that decision need to hear from all of us; from the workers, employers, families, not just the opposition.”
The event’s major sponsors included Amazon, Bank of America, Cal Poly, KSBY, Peregrine Hospitality and PG&E.
