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Study shows promising signs for innovation-driven East Bay economy

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OCTOBER 13, 2011

Despite the toll exacted on the East Bay economy by the recession, the strong underlying structure of the economy may allow it to rebound stronger than it was before the crisis, according to a study published Thursday.

Though one in every 10 jobs in the East Bay has been lost since 2007, the profession, scientific and technical service industries of the area are projected to grow by an annual rate of 3 percent over the next eight years, according to the study produced by the East Bay Economic Development Alliance.

The economic turmoil felt in the East Bay and Alameda County — unemployment rates for the county were 10.7 percent in August — is not unique to the region; the unemployment rate in Los Angeles County was at 12.5 percent in August and the state’s rate was at 12.1 percent, according to the California Employment Development Department.

However, while economic hardship is the norm across the state, the high number of research and development institutions in the East Bay is certainly not — the area is more than three and a half times more concentrated in scientific research and development than other regions, according to the study.

The positive effect this has had on the local economy — which the study says is driven by innovation — is unmistakable, Alameda County Supervisor Keith Carson, chair of the East Bay EDA, said in a press release about the study.

“It is clear that professional, scientific, and technical activities — including life science and clean energy firms play a vital role in our regional economy,” Carson said in the press release. “They are the drivers of economic growth in the East Bay and, as the report shows, critically linked to the East Bay’s strength in advanced manufacturing as well.”

The study recommends the building up of the local economy’s assets, listing among them the number of “world class” research and development institutions located in the area: UC Berkeley and the Lawrence Berkeley, Lawrence Livermore, and Sandia national laboratories.

In addition to directly employing over 30,000 workers, these research and development institutions have had a role in supporting many of the region’s professional, scientific, technical and information service and advanced manufacturing businesses, according to the study.

“The (Lawrence) Berkeley Lab absolutely helps the local economy,” said Paul Preuss, science writer and spokesperson for the Lawrence Berkeley National Laboratory. “We employ a lot of people and also have a lot of contractors in the area we use to do specific jobs here — so not only are we a big employer, we also use the services and products that are offered locally.”

The study concludes that with the shoring up of these institutions and further development of the various technical and scientific sectors in the region, the East Bay economy will be able to thrive and grow.

“With these assets identified, now comes the task of taking action to keep them strong and to allow employers and job seekers alike to benefit from them and from all the East Bay has to offer,” said Karen Engel, executive director of the East Bay EDA, in the press release. “Although the recession has taken a heavy toll on East Bay jobs and recovery is currently limited, the report shows why the region is poised to return to prosperity in the long term — across a variety of industry sectors.”

Contact Sara Khan at 


OCTOBER 13, 2011