1. Employment Trends and Cluster Opportunities Presented to the Steering Committee for the Los Angeles and Orange County Regional Consortium November 14, 2006

2. Research Objectives Primary Objectives:  Evaluate the economic environment in the LAOC region as it relates to supply and demand for workers  Identify key clusters in the regions and examine growth, wages, and regional concentration  Determine which clusters and areas of research should be considered in the future

3. Regional Economic Outlook Employment:  Steady employment growth forecast, with stronger growth in the service sectors Unemployment (August 2006):  US - 4.7%  California - 4.9%  Los Angeles County - 5.1%  Orange County - 3.6% Issues in the regional economy:  Depreciation of the dollar  Regional infrastructure for trade (short and long-term)  Agreement to cut greenhouse gasses  Rising interest rates and inflation  Housing affordability

4. Industry Clusters Definition: “A concentration of companies and industries in a geographic region, which are interconnected by the markets they serve and the products they produce, as well as the network of suppliers and key economic foundations such as research universities, capital, physical infrastructure and labor market.” Source: California Regional Economies Project Why are Clusters Important:  Drivers of the regional economy  Require focused workforce development strategies  Opportunities for strategic planning and employer collaboration with the community colleges

5. Industry Clusters I 1. Apparel Design and Manufacturing: includes businesses that design and manufacture textiles, apparel and footwear; 2. Construction: includes firms that provide residential, commercial, and heavy-duty infrastructure construction services; 3. International Trade and Logistics: includes firms that are engaged in or support the transportation and warehousing of products; 4. Motion Picture and TV Production: includes businesses that produce and support the production of movies, radio, television, and music; 5. Tourism and Entertainment: includes firms that provide a broad array of visitor and leisure services, including eating and drinking establishments, hotels, amusement parks, and transportation services for visitors.

6. Industry Clusters II 1. Business and Professional Management Services: includes a wide range of business support services, from printing and employment services, to accounting, architecture, and legal services; 2. Education: includes public and private education facilities (kindergarten through high school), colleges and universities, trade schools, and educational support services; 3. Finance, Insurance, and Real Estate (FIRE): includes firms that provide financial, insurance, and real estate services; 4. Healthcare and Medical Services: includes businesses that provide medical services, from comprehensive acute care hospitals, to medical offices, and long-term care facilities and services; 5. Public Sector (Government): includes local, state, and federal government employers, including public safety services, national security operations, and community development programs.

7. Industry Clusters III 1. Communications: includes businesses that provide telecommunications services and manufacture communications equipment, including audio and video equipment; 2. Computer and Electronics Manufacturing: includes firms that manufacture and support the manufacture of computers, semiconductors, and other electronic equipment; 3. Defense and Transportation Manufacturing: includes firms that manufacture transportation vehicles, including planes and ships, as well as defense contractors; 4. Energy and the Environment: includes firms that manufacture or research energy production, as well as products and services used to mitigate the environmental impact of these activities; 5. Life Sciences and Biotechnology: includes firms that are engaged in or support research, development, and production in the life sciences; 6. Software and Computer Services: includes firms that develop software and provide computer services, including Internet service providers.

8. Measures of Employment & Concentration in LAOC High Employment/ High Concentration Industry Clusters Emp.Conc. Business & Professional Mgt. Svcs.11.1%1.18 Tourism, Travel, & Entertainment11.1%1.10 Finance, Insurance, & Real Estate6.7%1.21 Life Sciences & Biotechnology4.2%1.11 See pages 12 – 16 in the memo for a more comprehensive display of proportional employment and concentrations in the LAOC region

9. Measures of Employment & Concentration in LA Low Employment/ High Concentration Industry Clusters Emp.Conc. Apparel Design & Mfg.2.1%2.48 Defense & Transportation Mfg.1.8%1.58 Communications1.0%1.04 Energy & the Environment0.5%1.28 See pages 12 – 16 in the memo for a more comprehensive display of proportional employment and concentrations in the Los Angeles County

10. Measures of Employment & Concentration in OC High Employment/ Low Concentration Industry Clusters Emp.Conc. Healthcare & Medical Services7.1%0.87 Public Sector (Government)3.6%0.45 See pages 12 – 16 in the memo for a more comprehensive display of proportional employment and concentrations in Orange County

11. Expected Employment Growth in LAOC, 2005 - 2012 Industry Clusters I

12. Expected Employment Growth in LAOC, 2005 - 2012 Industry Clusters II

13. Expected Employment Growth in LAOC, 2005 - 2012 Industry Clusters III

14. Expected Employment Growth by County, 2005 - 2012 See page 16 in the memo for the complete table

15. Median Wage by Industry Cluster (LAOC, 2004)

16. Emerging Clusters Video Gaming and Entertainment Technology Strong presence in the region – 50% of California companies in LAOC Strong employment growth expected Opportunities for local community colleges to support future growth in the industry Computer & Information Security Strong short-term employment growth expected Opportunities for Database Security Engineers & Data Security Analysts Homeland Security & Nanotechnology Findings indicate potential for employment growth and opportunities for community colleges to help support the growth of these clusters through local workforce development

17. Clusters to Focus on in Future Research I 1. Energy & the Environment: Review and Revise cluster definitions Reevaluate growth expectations due to the current legislative and economic environment Identify sub-sectors and occupations with strong growth expectations Determine appropriate strategies and programs for community colleges 2. Software & Computer Services: Identify sub-sectors Identify work that is being outsourced and why employment concentration is low for the region Identify work that is growing within the region Determine growth occupations Determine skill-sets of importance

18. Clusters to Focus on in Future Research II 3. Business & Professional Management Services: Identify sub-sectors and occupations with strong growth expectations Work with employers to determine appropriate strategies and programs for community colleges 4. Public Sector: Evaluate workforce needs taking into account the high level of expected retirements in this cluster Identify sub-sectors and occupations most affected by forthcoming retirements Determine the composition of the local workforce Identity key skills-sets Work with employers to determine appropriate strategies and programs for community colleges

19. Clusters to Focus on in Future Research III 5. Life Sciences & Biotechnology: Define the industry cluster Assess demand for manufacturing and technical workers in the region Identify work that may be outsourced and work that is growing within the region Determine key skill-sets/ areas of specialization Work with employers to determine key training requirements 6. Travel, Tourism, and Entertainment: Identify higher-paying sub-sectors and occupations Determine the types of programs which could be developed by local community colleges Identify strategies to effectively collaborate with employers Identify and implement career-ladder programs in the industry

20. Clusters to Focus on in Future Research IV 7. Motion Picture and TV Production (LA Only): Identify sub-sectors and occupations with strong growth expectations Identify work that is being outsourced and work that is growing within the region Determine key skill-sets/ areas of specialization Identify and implement career-ladder programs in the industry Work with employers to determine appropriate strategies and programs for community colleges

21. Employment Trends and Cluster Opportunities Presented to the Steering Committee for the Los Angeles and Orange County Regional Consortium November 14, 2006