Why Biomedical Jobs Are Recession Resilient

2/12/10

Biomedical employment has held remarkably steady in San Diego and throughout California, even though other parts of our economy saw steep declines and the highest unemployment levels since the Great Depression. That was the top-line finding of the 2010 California Biomedical Industry Report, just released by the California Healthcare Institute (CHI) and PricewaterhouseCoopers.

San Diego saw the strongest employment growth among the state’s main biomedical clusters. Despite the recession, biomedical jobs here grew 2.5 percent—from 23,545 in March 2008 to 24,123 in March 2009—expanding faster than in the San Francisco Bay Area, Los Angeles or Orange County. Statewide, the biomedical industry puts nearly 274,000 Californians to work in jobs that pay an average of nearly $75,000.

Biomedical jobs are a critical part of economic recovery, not only regionally but also statewide. Factoring in the multiplier effect—the additional employment in firms that provide services and supplies to life sciences companies—the biomedical industry accounts for more than 750,000 direct and indirect jobs statewide. The biomedical industry is the second largest sector of California’s high-tech workforce, after computer and Internet-related services.

So why have biomedical jobs been so recession resilient, particularly in San Diego? In part, the answer lies in the relative youth of the industry. Biotechnology was born in San Francisco in the late 1970s. And many companies are just now bringing their products to market, adding manufacturing, sales and marketing staff to support their launch. Meanwhile, the demand for new medicines and treatments is strong and growing. Aging populations around the world mean the need for innovative technologies will only increase. San Diego should remain a magnet for jobs and funding, with its leading biopharmaceutical and diagnostic companies, top universities and world-class research institutes.

According to a survey of the top 200 biomedical employers in California commissioned by CHI and PricewaterhouseCoopers in November 2009, the industry is positioned for robust growth. Yet how much of this takes place in California remains to be seen. Over the next two years, 81 percent of biomedical companies expect to maintain or increase their workforce in California. At the same time, though, two-thirds of them also expect to increase their out-of-state manufacturing workforce over the next two years, while more than half (58 percent) anticipate expanding their research and development workforce outside of California.

Biomedical innovation delivers not only global advances in healthcare, but the jobs that drive our economy. While the biomedical industry is weathering the recession, it faces unprecedented challenges – access to capital, the educational funding crisis and uncertainty surrounding healthcare reform. Now more than ever, the sustainability of California’s biomedical industry depends on decisions made in Sacramento and Washington.

If we want to keep high-quality biomedical jobs, we need to create an environment that rewards companies and research institutes for growing and hiring here. At stake is not only the economy, but also our promise of scientific innovation that benefits patients around the world.

David Gollaher, Ph.D., is president and chief executive officer of the California Healthcare Institute (CHI). Based in La Jolla, CHI is a non-profit public policy research organization representing more than 250 leading medical device, biotechnology, diagnostics and pharmaceutical companies and public and private academic biomedical research organizations. Follow @

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