Los Angeles County s Jobs outlook for 2017 and Beyond June 21, Tracy Hernandez BizFed Founding CEO

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1 Los Angeles County s Jobs outlook for 2017 and Beyond June 21, 2017 Tracy Hernandez BizFed Founding CEO

2 Connecting Job Creators to Policy Makers to Improve Our Local Economy

3 Who is BizFed? Grassroots alliance of more than 160 diverse business groups, including: Industry trade groups Chambers of Commerce Ethnic business groups Business Improvement Districts Premier independent companies and agencies Represents more than 325,000 businesses with nearly 3 million employees across all 88 cities in Los Angeles County Strengthening the voice of business in Los Angeles and the Region, Sacramento and Washington, D.C.

4 Leverages strength in numbers and energy and expertise of members to mobilize and advocate on critical issues affecting economic vitality. (501(c)6 Business Advocacy Organization.) Business growth, job creation, and economic vitality in Southern California BizFed s think tank convenes top experts, diverse voices, and unlikely partners for intelligent, inclusive, impactful analysis to confront challenging issues in our state. (501(c)3 Education and Research Foundation.) BizFed s Political Action Committee identifies and supports businessfriendly candidates and is the only organized effort focused on all 88 city-level governments. (California Recipient Committee)

5 BizFed 2017 Member Poll Survey distributed throughout BizFed membership and by extension their member networks; 135 out of 155 member organizations responded 715 total responses (highest response ever) Poll open from March 14 through April 24, 2017 Survey tightly focused on critical topics to help propel targeted action and impact

6 Employers who participated Type of Ownership Closed Corporations: 41% Individual Proprietorships: 22% Not-for-Profit Organizations: 16% Public Corporation: 13% Independent Contractor: 7% Public Agency: 1% Employment Size 1-10 Employees 45% Employees 22% Employees 10% Employees 16% >500 Employees 7% (Note: In LA County 96% of businesses have 100 employees or less.)

7 Top Participating Industries 1. Professional Services 2. Realtors 3. Real Estate Management & Invstmt 4. Transportation 5. Business Services 6. Construction 7. Non-profit Agencies 8. Chamber of Commerce/Trade Assoc 9. Health 10. Financial Services & Retail (tied) 11. Energy 12. Technology

8 Top Economic Policies for Trump Administration to Address ISSUE RANK Infrastructure (housing, roads, bridges, tunnels) 63% Taxes 57% Health Care 41% Trade 31% Education 29% Immigration 29% Homeland/Cyber Security 24% Energy 22% Water (Access & Reliability) 17%

9 Top Economic Policies for California Legislature to Address ISSUE RANK Taxes 56% Transportation 39% Housing 36% Water Access & Reliability 28% Education 27% Immigration 23% Public Safety/Law Enforcement 22% Energy 18% Health Care 18% Trade 14%

10 OVERALL Top Priorities To Address in Taxes and Fees; #1 concern since Public Infrastructure (Roads, rail, bridges, waterways, etc.); Moves from #5 (2016) to #2 in 2017; Top 10 concern since Government Regulation/Compliance; Top 5 concern since Legislative Gridlock (State and/or Federal); Moves from #9 (2016) to #4 in Transportation moves from #2 (2016) to #5 in 2017; Top 10 concern since 2012

11 Top Issues: Ten Year Trend Question Taxes Public Infrastructure (Roads, rail, bridges, waterways, etc.) Government Regulation/Compliance Legislative Gridlock (State and/or Fed) Transportation Local Permit Process State & Local Budgets Environmental Regulations Education Housing/Land Use 10 Health Care Crime Water (Acces & Reliability) Energy/Fuel Costs Public Employee Pensions Immigration 16 Homelessness 17 International Trade (Exports/Imports) 19 Workers' Compensation Job Training 21 Availability of Monetary Credit

12 Highlights Business Outlook Investment in human capital was selected as a new top initiative in 2017 Overall, 74% indicate an investment in employee training/retraining Almost equally strong, 63% indicate an investment in automation/technology 58% an investment in the purchase of durable goods

13 Business Friendly Government Overall, businesses rely most on CITY government and consistently consider it the most business friendly CITY Government is Business Friendly 40% 49% COUNTY Government is Business Friendly 22% 27% STATE Government is Business Friendly 14% 14%

14 Business Concerns Fight or Flight from LA EXPANSION plans HERE are DOWN, and MORE plan to LEAVE 22% indicated plans to expand in the City/County/State (vs 25% in 2016) In comparison, 9% indicated plans to leave the City/County/State (vs 6% in 2016) - Business Factors Indicated: Increasing costs to do business Taxes, Fees, Regulations High cost of real estate to develop/expand - Employee Factors Indicated High cost of living Lack of affordable housing

15 Factors for Businesses and Jobs Leaving LA County/California ISSUE High Taxes and Fees 73% 81% Regulatory Environment 63% 66% Traffic Congestion/Transportation 44% 56% Housing/Land Use (new in 2017) % Attractive Incentives 24% 39% Cost of Goods & Services 27% 35% Lack of Skilled Workforce (new in 2017) % Homelessness (new in 2017) %

16 Most/Least Business Friendly Most Business Friendly LA County Cities Santa Clarita (n=67) Long Beach (n=28) Torrance (n=28) Burbank (n=24) Los Angeles (n=20) Least Business Friendly LA County Cities Los Angeles (n=184) Santa Monica (n=63) Carson (n=19) Pasadena (n=12) Beverly Hills (n=12)

17 The Poll: Bottom Line 1. Businesses are generally optimistic about the future 2. Hiring outlook is mixed, training/retraining is a bigger focus but also investing more in technology 3. Transportation & infrastructure improvements remain vital 4. More housing is necessary to attract and retain businesses 5. Up-tick in jobs going elsewhere, High taxes and fees, regulatory environment, and housing costs are the top three reasons businesses leave LA County

18 Delivering Ideas and Action! Informed by our annual survey results, BizFed brings together top subject experts and engages our massive, diverse grassroots alliance to develop solutions and drive action on critical issues for our region.

19 2017 Issues Tracking Overview Highlights - Total issues: 56; W/L record: 6-1; In progress: 49

20 Action Items CA State Legislature Legislation Topic BizFed Position Status Action SB346 Glazer Promotes coordinated effort by schools to offer comp science as curriculum. Requires CA Dept. Ed & State Board Ed to develop & consider adopting plan. Support 4/17/2017 Asm. Education 6/21/17 hearing; 6/15/17 Budget Trailer Bill 4/19/17 letter to Glazer; 6/10/17 letters to Asm. Education & Asm. Budget SB349 Lara A measure that would mandate arbitrary staffing ratios on dialysis providers in CA, Oppose 5/16/2017 Asm. Health 6/27/2017 hearing 5/18/17 letter to Sen/ Appropriations 6/10/17 letter to Asm. Health AB378 C. Garcia Increases the cost for compliance and creates extra regulatory burdens for businesses by relying on direct control measures to meet CA s climate goals. Oppose 5/16/17 5/31/17 Asm Floor Vote: 35/39/6 DEAD Coalition Supporters letter to 3/28/17 Asm. Appropriations AB1583 Chau Greater transparency in Prop. 65 cases. Reduces litigation costs by requiring private enforcers to provide factual basis for Cert of Merit along with AG, DA, City Atty or prosecutor. Support 5/16/17 Sen. Environmental Quality 6/32/27 hearing Judiciary 5/18/17 letter to Asm. Appropriations 6/10/17 letter to Sen Environmental Quality

21 Action Items: Local & Regulatory Issues Issue Topic BizFed Position Status POC Measure H: LA County Homeless Sales Tax Combating Homelessness Support 1/24/17 Passed 3/7/2017 Vote: 67.4% Metro Clean Bus Procurement Purchase of new buses Support Staff Recommend 3/21/17 Metro Board June/July 2017 bizfed.org Measure S; City of Los Angeles Anti development initiative Oppose 2017 Defeated 3/7/2017 Vote: 31.15%/68.85% bizfed.org California Water Fix A science driven upgrade to CA s aging water system Support 2015 State Water Resources Control Board 2916 Air Quality Management Plan Regional planning to meet air basin fed, air qual stds. Support Without Amendments AQMD 2/3/2017 CARB 3/23/2017 Adopted

22 Leverages strength in numbers and energy and expertise of members to mobilize and advocate on critical issues affecting economic vitality. (501(c)6 Business Advocacy Organization.) Business growth, job creation, and economic vitality in Southern California BizFed s think tank convenes top experts, diverse voices, and unlikely partners for intelligent, inclusive, impactful analysis to confront challenging issues in our state. (501(c)3 Education and Research Foundation.) BizFed s Political Action Committee identifies and supports businessfriendly candidates and is the only organized effort focused on all 88 city-level governments. (California Recipient Committee)

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24 Idea: First 100 Days NextUp Economic Forum: The New Administration s First 100 Days U.S. Representative Judy Chu (D-CA, 27 th ) and CA Attorney General Xavier Becerra join fellow political thoughts leaders and former electeds Thought leaders from academia, business, media and politics cover First 100 Days analysis, brand new BizFed Pulse Poll results, and economic trends KEY TAKEAWAYS: Leverage public-private partnerships for every economic problem to get investment and return, so we don t have to worry about increasing taxes, fees, etc. Technology expecting to replace about 50-60% of existing jobs

25 Leverages strength in numbers and energy and expertise of members to mobilize and advocate on critical issues affecting economic vitality. (501(c)6 Business Advocacy Organization.) Business growth, job creation, and economic vitality in Southern California BizFed s think tank convenes top experts, diverse voices, and unlikely partners for intelligent, inclusive, impactful analysis to confront challenging issues in our state. (501(c)3 Education and Research Foundation.) BizFed s Political Action Committee identifies and supports businessfriendly candidates and is the only organized effort focused on all 88 city-level governments. (California Recipient Committee)

26 Cities with PAC Endorsed Candidates 197 BizFed PAC endorsed candidates 141 now represent 54 cities across L.A. County 52 WON by LESS THAN 200 VOTES with our help!

27 The Way Forward By engaging Southern California employers with a laser focus on the issues they care about most, together we can deliver business growth, job creation, and economic vitality throughout our region and beyond! Thank You! Tracy Hernandez BizFed Founding CEO thernandez@bizfed.org