By: Ronald Epps
San Diego’s economy is at a crossroads, facing challenges that could shape the region’s future for decades. The 41st Annual Economic Roundtable brought together leading economists and policy experts to discuss pressing issues, from affordability and workforce development to trade and emerging technologies.
The event featured insights from Daniel Enemark, Chief Economist at the San Diego Regional Policy & Innovation Center, who analyzed regional economic trends and labor market challenges. Ryan Ratcliff, Ph.D., from USD’s Knauss School of Business, discussed historical and macroeconomic views on income inequality, inflation, and job growth. Kenia Zamarripa, Vice President at the San Diego Regional Chamber of Commerce, emphasized the importance of binational trade and policy in economic development.
Keynote speaker Kyla Scanlon, a financial educator, introduced her “Vibesession” concept, addressing how emotions impact financial decisions and the disconnect between economic data and personal experiences. Together, these experts provided a comprehensive view of San Diego’s economic landscape, highlighting significant challenges and opportunities.
Analyzing the Economic Landscape and Affordability Crisis
Daniel Enemark began the panelist presentations by discussing the economic composition of San Diego’s population. He pointed out that San Diego County is home to 3.27 million residents, accounting for 1% of the U.S. population and ranking as the fifth — largest county in the country — larger than 20 states and Washington, D.C. Additionally, the region boasts one of the largest economies in the nation, with a Gross Regional Product (GRP) of $316 billion, surpassing the economic output of 25 states and 163 countries, including Finland, Portugal, and Greece.
He notes that despite San Diego County having a median household income of $97,000 — which is $22,000 higher than the U.S. median — 335,000 people in San Diego County still live in poverty (nearly 11% of all San Diegans).
Poverty is defined as earnings below the federal poverty threshold, which does not fully account for the high cost of living in the region. San Diego County’s Self-Sufficiency Standard offers a more accurate measure, reflecting the actual cost of basic needs, such as housing, food, healthcare, and childcare, without relying on public or private assistance.
Nearly 35% of San Diego County residents struggle to meet San Diego County’s Self-Sufficiency Standard, which is approximately $58,745, or about $4,895 per month for a single adult and around $97,861, equating to roughly $8,155 per month for a household comprising two adults, one preschool-aged child, and one school-aged child.
This highlights a growing affordability crisis, where the cost of living is pricing many out of the region. San Diego’s job growth is lagging behind the state, with a concerning trend of young people leaving due to high living costs. Between July 2022 and July 2023, nearly 31,000 more people left San Diego County than those who moved in, according to the U.S. Census Bureau. As Ryan Ratcliff pointed out, “We’re turning into a place where it’s nice to live if you already have a lot of money.” This demographic shift poses a threat to the region’s dynamic economy.
Ratcliff also likened the current economic climate to a “new Gilded Age,” where most income growth benefits the wealthiest, reminiscent of the Robber Baron era (term used to describe successful industrialists whose business practices were often considered ruthless or unethical). Inflation remains a pressing concern, but as Ratcliff emphasized, prices don’t simply fall; wage growth must keep pace with rising costs.
The Binational Economy
In her discussion of the Cali Baja Binational Economy, which encompasses San Diego and Imperial Counties as well as Baja California, particularly Tijuana, Kenia Zamarripa emphasizes the importance of considering the broader binational economy when discussing San Diego. She points out that while San Diego’s population may be declining, Tijuana’s population is increasing. Many workers reside in Tijuana and commute to San Diego, creating a unique cross-border dynamic. According to data from 2022-2023, half a million jobs in California are supported by trade with Mexico, and nearly 60,000 individuals cross the Southern border into San Diego for work each day, providing valuable binational workforce solutions.
Trade with Mexico plays a critical role in San Diego’s economy, with 17% of California exports heading south. Each year, over $60 billion in trade crosses the border through land ports in San Diego alone, symbolizing the importance of binational cooperation.
Advocating for Small Businesses Growth in San Diego
In San Diego, where small businesses constitute 98% of the economic landscape, it is imperative for entrepreneurs to articulate their needs to the local chamber of commerce. By doing so, they enable the chamber to effectively convey these concerns to local and state government officials. Conversely, larger corporations often excel in advocating for their interests due to their established channels of communication and resources.
Radcliff highlights that certain government policies can generate considerable uncertainty and impose restrictions, while others may adopt a more lenient regulatory approach, facilitating a more conducive environment for business growth.
Zamarripa highlights that navigating laws and regulations can be a significant challenge for many entrepreneurs, particularly those with innovative business ideas. Often, they may lack the necessary knowledge or expertise to utilize the resources required for sustainability, or they may be uncertain about whom to approach for assistance. The complexity of local, state and federal guidelines is further complicated in our binational region, where regulatory frameworks in Mexico introduce additional layers of complexity.
Kyla Scanlon’s Keynote Address: Building Trust and Community Economics
Kyla Scanlon’s keynote, highlighted the U.S. economy’s resilience compared to other high-income nations, emphasizing how fiscal policies successfully sustained growth while inflation declined. She noted the strength of the labor market, with prime-age employment reaching record highs and steady job growth in healthcare and manufacturing. Inflation, while moderating, remained just above the Federal Reserve’s 2% target.
However, economic stability masked persistent affordability challenges. Housing costs remained high, with median home prices at 4.5 times the median income, and student loan repayments further strained household budgets. Additionally, public trust in institutions — including government, Big Tech and financial regulators — continued to erode.
Scanlon described a divide between two economies: The Data Economy and the Lived Economy. The Data Economy reflects strong GDP growth, low unemployment, stock market highs and cooling inflation. In the Lived Economy, young professionals spend over 40% of their income on housing, credit card debt is at record levels, and institutional trust has reached historic lows, deepening generational wealth divides.
A recurring theme was the importance of trust. Scanlon underscored the need to rebuild trust in institutions and shift towards community-driven solutions. Businesses like Costco are reimagining their role by integrating housing into their operations, demonstrating the value of combining institutional trust with local engagement. Her address underscored the urgent need for strategic adaptation to bridge these divides and foster a more inclusive, resilient economy. As Scanlon concluded, success must be redefined, prioritizing flexibility, trust and innovative approaches to economic and workforce development.