The Milken Institute released an in-depth analysis of the Kern County economy, with recommendations on how the county can continue its economic trajectory. “An Economic Road Map for Kern County” details both the success of the past and paths for the future.
On the southern end of the Central Valley, and just north of the Los Angeles region, Kern County’s economy has traditionally been driven by its wealth of energy resources and fertile soil. Nearly 80 percent of California’s active oil and gas wells are in Kern, and the county produces about 5 percent of U.S. oil. In recent years, Kern has diversified its energy portfolio with major new projects in wind and solar power. The county is also a breadbasket for the nation – more exactly, a pistachio, carrot, almond, and grape cornucopia. Agricultural sales were nearly $7 billion in 2013, making Kern the No. 2 food producing county in the country.
Marked by its streamlined business permitting process, abundance of open space, and relatively low living costs, Kern County has displayed strong economic performance, with rates of job growth higher than the state and the nation since 2007.
Kern County’s economic prowess is not simply the result of its natural blessings, but also its smart regulatory approach. With California’s position as a leader in environmental protection, every county in the state has regulations that a company would not face in other states. Yet Kern has demonstrated that such regulations need not be too onerous if managed sensibly. One example is Kern County’s streamlining of the California Environmental Quality Act (CEQA) process, which encourages well-planned development from the outset, rather than in piecemeal and slow stages. Kern’s proactive approach to CEQA permitting is evidenced by comparing the number of environmental impacts reports it filed – 43 since 2010 – to its peers. Most counties filed merely a handful; only Los Angeles County came anywhere close, with 28.
“An Economic Road Map for Kern County” provides a number of specific recommendations for the county to continue its growth. These include:
- Utilize Kern’s proximity to Los Angeles, developable space, and strong business climate to attract companies from near and far. Since there is little overlap between Los Angeles’ and Kern County’s economic profiles, many opportunities exist in Kern for firms looking to expand beyond L.A. Kern is also well positioned to draw in foreign investors seeking a California manufacturing base.
- Provide more financing for small businesses by partnering with regional Community Development Financial Institutions to create a multibank. Nearly 90 percent of Kern businesses employ 100 or fewer people, and lending to the small business sector has not recovered since the Great Recession. Kern has the capital and institutions to support a multibank, and could greatly benefit from creating one.
- Expand in-county educational opportunities. Unemployment is highest for high school dropouts in Kern: linked-learning programs pairing academics with real world technical skills would help students increase their employability. At the college level, CSU Bakersfield should leverage existing relationships with local companies to place students in STEM positions where they can earn both wages and college credits.
- Maintain the cohesive planning approach that makes doing business in Kern easier than in competing areas. Continuing to foster an open business climate and enlightened regulatory process will help the county maintain its competitive edge.
“Whether it be workforce development, business climate, or smart growth, many communities across the nation face similar challenges to Kern County,” said Perry Wong, managing director of research at the Milken Institute. “Our report outlines ways in which Kern can leverage its resources and build on successful policies to create a more prosperous economic future — a lesson that’s applicable for any community.”
About the Milken Institute
A nonprofit, nonpartisan think tank, the Milken Institute’s mission is to improve lives around the world by advancing innovative economic and policy solutions that create jobs, widen access to capital and enhance health
For more information or to interview one of the authors, contact Conrad Kiechel, Director of Communications, at (310) 570-4668 or email@example.com