Council District 10 City of Los Angeles

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ECONOMIC PROFILE OF

COUNCIL DISTRICT 10

CITY OF LOS ANGELES 2018 Job creation and fostering good government have long been the focus of the Los Angeles Area Chamber of Commerce’s advocacy at L.A. City Hall. If you can’t measure it, you can’t improve it. –Peter Drucker

Understanding the local labor market dynamics in the City of Los Angeles is essential to fostering economic growth for its residents and businesses. In 2010 the L.A. Area Chamber, in partnership with Beacon Economics, began publishing an annual L.A. City Council Districts Economic Report—a high level overview of jobs, business activity and demographics in each of the city’s ﬁfteen districts. This unprecedented sub-regional analysis utilizes new data sources and mapping tools and has become an important resource for City Council members, as well as the business community, in understanding how L.A.’s economy is faring.

The tools being used for this high level analysis have far greater capabilities than the current industry standard. With this in mind, we’ve taken the next step of digging even deeper into the distinctions that make each district unique. As a partnership between the L.A. Area Chamber, Los Angeles City Council President Herb Wesson, and Beacon Economics and sponsored by NBCUniversal, this ﬁrst in-depth Council District study focuses on Los Angeles’ 10th Council District. Located in Central and South Los Angeles, the 10th Council District includes the neighborhoods of Koreatown, Little Bangladesh, West Adams, Jefferson Park, Wilshire Center, South Robertson, Arlington Heights, Leimert Park, Faircrest Heights, Gramercy Park and parts of Baldwin Hills. This report examines the distribution of jobs across the district, geographic concentrations of jobs, industry growth rates by neighborhood and business growth within these zones.

City Council ofﬁces have a direct impact on projects within their districts and throughout L.A. By understanding how their efforts relate to shifting employment dynamics within the region, councilmembers can better shape their policy initiatives to achieve the most beneﬁcial results for their constituents. We hope to use this report as a model for studies of other Council Districts, so that representatives have readily available data to create more impactful economic policies for those who live, learn and work in their communities.

Creating new jobs requires everyone’s commitment.

Maria Salinas, President Herb Wesson, Council & CEO President Los Angeles Chamber of Los Angeles City Council Commerce Christopher Thornberg Adam J. Fowler Founding Partner Director of Research 5777 West Century Boulevard, 5777 West Century Boulevard, Suite 895 Suite 895 Los Angeles, CA 90046 Los Angeles, CA 90046 310.571.3399 424.646.4652 [email protected] [email protected]

Taner Osman, Ph.D. Justin Niakamal Senior Research Fellow Senior Research Associate [email protected] [email protected]

For further information about this publication please contact:

Victoria Pike Bond Rick Smith Director of Communications Director of Business Development 415.457.6030 858.997.1834 [email protected] [email protected]

Or visit our website at:

Reproduction of this document or any portion therein is prohibited with out the express written permission of Beacon Economics, LLC.

Council District 10 Drill Down | Los Angeles TABLE OF CONTENTS

Purpose of Study i. Executive Summary ES-1 Los Angeles Council District 10 Overview 2 Economic Proﬁle 10 Emerging and Declining Sectors in District 10 17 Wage Analysis of Broad Industries 23 Detailed Industry Analysis 25 Health Care Drill Down 25 Leisure and Hospitality Drill Down 26 Administrative Support Services Drill Down 27 Locally Focused Economy 28 Summary and Recommendations 29

Council District 10 Drill Down | Los Angeles EXECUTIVE SUMMARY

City Council District 10, geographically one of the smallest districts in Los Angeles, lies south and west of downtown, and is split roughly in half by Interstate 10. District 10 accounts for 6% of the population in the City of Los Angeles and around 4.7% of the city’s total employment. The district is ethnically diverse-, and is home to relatively low-income households compared to the rest of the City of Los Angeles. The district has an economy that is distinct from the rest of the City of Los Angeles, specializing in the healthcare, leisure and hospitality, and retail sectors of the economy.

The key ﬁndings from this report:

• Since the ﬁrst quarter of 2008, total employment has grown faster in District 10 than in the rest of the City of Los Angeles. • Employment growth has slowed recently in both the district and the city as the economy nears full employment.

Council District 10 Drill Down | Los Angeles • Leisure and hospitality is the fastest-growing sector in the district. Employment in the sector grew 64% over the period 2008-2017, compared to 33% in the rest of the city. • Signiﬁcant employment growth also occurred in the healthcare (20%) and retail (19%) sectors of the economy over the same period. • The biggest sectoral demise was in the district’s manufacturing sector, where employment has decreased by 43% since 2008. This change reﬂects broader trends in the city. • Employment in the transportation and warehousing sector has also fell since 2008, declining 15%, while growing 15% in the rest of the city. • On average, employers in District 10 pay wages of $45,859 per year, compared to $65,651 in the rest of the city. • The reason for this difference is two-fold. First, CD10 has a higher proportion of employment in lower-paying industries than is the case in the rest of the city. • Compared to the rest of the City of Los Angeles, District 10’s economy is more specialized in lower-paying sectors of the city’s economy, such as health care, leisure and hospitality, and administrative support. • Second, within particular sectors of the economy, CD10 is relatively more specialized in lower-paying segments of industries.

Council District 10 Drill Down | Los Angeles • Council District 10 can shape many aspects of its local economy, but in some areas, the Council District is beholden to larger macroeconomic forces. • Council District 10, for example, cannot control trends towards automation and globalization in the manufacturing sector of the economy. • While Council District 10 cannot change global factors, it can play an active role in repurposing land zoned for manufacturing activities to some other use. • For example, land zoned for manufacturing might be re-zoned for activities in the growing sectors of the district’s economy, such as healthcare. • In the long run, the growth of the district’s economy will be inﬂuenced by the amount of land that is made available for commercial and industrial development. If the amount of space for commercial and industrial development remains ﬁxed over time, this will cap employment growth in the district

Council District 10 Drill Down | Los Angeles Council District 10 Drill Down | Los Angeles LOS ANGELES COUNCIL DISTRICT 10 OVERVIEW

City Council District 10, geographically one of the smallest districts in Los Angeles, lies south and west of downtown Los Angeles, and is split roughly in half by Interstate 10. The District is home to a diversity of ethnic enclaves and is comprised of 52 neighborhoods, notably including Koreatown, Little Ethiopia, Leimert Park and Mid-City. The district accounts for around 6% of the City of Los Angeles’ population and is less wealthy, and more racially diverse, than the City of Los Angeles as a whole. Herb Wesson has been the district’s councilmember since 2005.

Council District 10 Drill Down | Los Angeles Below is a list of all neighborhoods that make up Council District 10.

Neighborhoods in Council District 10

20th Street Block Club Harvard Heights North Potomac Block Club

4th Ave Block Club Historic Leimert Park Village Queen Anne

9th Ave Block Club JBAC Redondo Sycamore

Alsace Avenue Jefferson Park Regent Square

Angelus Vista Kinney Heights Reynier Village

Arlington Heights Koreatown Smiley/Hauser

Avenues of Washington La Cienega Heights SODA

Baldwin Hills Village Garden Lafayette Square South Robertson

Baldwin Village LANA Spaulding/Thurman/Genesee

Baldwin Vista Leimert Park St. Elmo

Beverly/Kingsley Little Bangladesh Veronica/Sanchez/Sycamore

Cameo Woods Little Ethiopia Victoria Park

CHAPS Longwood Village Green

Cherrywood Marvin/Carmona/Curson Wellington Square

Country Club Park McClung/Bronson West Adams Avenues

Crenshaw Manor Mid City West Adams Heights Sugar Hill

Crenshaw Neighbors Olympic Park Western Heights

Faircrest Heights Oxford Square Wilshire Center

Gramercy Park Picfair Village Wilshire Highland

Grayburn Block Club Pico Del Mar Wilshire Vista

Harvard Heights Pico Park Wilshire Vista Heights

Council District 10 Drill Down | Los Angeles Map 1. The Locaon of Los Angeles' Council District 10

Council District 10 Los Angeles City Boundary

Council District 10 Drill Down | Los Angeles Demographic Proﬁle In 2015, the district had a population of around 239,000 residents, with a median age of roughly 35, which was roughly the same as the City’s median age.

Figure 1. Median Age by Council District, City of Los Angeles, 2015

Median Age by Council District, City of Los Angeles, 2015 40

10 Median Age (Years)

0 CD 1 CD 2 CD 3 CD 4 CD 5 CD 6 CD 7 CD 8 CD 9 CD 10 CD 11 CD 12 CD 13 CD 14 CD 15

Source: American Community Survey; Calculaons by Beacon Economics

Roughly 74% of the district’s residents hold at least a high school diploma, fewer than the city-wide average of 76%.

Figure 2. Percent of Populaon 25+ With a High School Diploma, By Council District, City of Los Angeles, 2015

Percent of Population 25+ With a High School Diploma By Council District, City of Los Angeles, 2015 100

50 Diploma 25 With a High School

Percent of Population 25+ Percent 0 CD 1 CD 2 CD 3 CD 4 CD 5 CD 6 CD 7 CD 8 CD 9 CD 10CD 11 CD 12CD 13CD 14 CD 15

Source: American Community Survey; Calculaons by Beacon Economics

Council District 10 Drill Down | Los Angeles Around 26% of the district’s residents are college graduates, which is somewhat lower than the city-wide average of 33%. However, it is worth noting that the percentage of residents with a bachelor’s degree in District 10 is more than twice the rate as residents in nearby District 8 to the south, and somewhat higher than the residents of nearby District 14 to the east.

Figure 3. Percent of Populaon 25+ With a Bachelor’s Degree, By Council District, City of Los Angeles, 2015

Percent of Population 25+ With a Bachelor’s Degree By Council District, City of Los Angeles, 2015 70

35 Degree

18 Percent of Population 25+ With a Bachelor’s of Population 25+ With a Bachelor’s Percent 0 CD 1 CD 2 CD 3 CD 4 CD 5 CD 6 CD 7 CD 8 CD 9 CD 10 CD 11 CD 12 CD 13 CD 14 CD 15 Source: American Community Survey; Calculaons by Beacon Economics

District 10’s residents are relatively less afﬂuent than those the City as a whole. Median household income in the district stood at $43,100 per year in 2015, compared to the city- wide average of $52,000.

Council District 10 Drill Down | Los Angeles Around 32% of District 10’s households have an income of less than $25,000 per annum, compared to 25% at the city level. By contrast, 26% of the household’s in the City have a household income of greater than $100,000, compared to only 12% in the district.

Table 1. Income Characteriscs in 2015: District 10 vs. the City of Los Angeles and Los Angeles County

City of Los Los Angeles Metric District 10 Angeles County

Median Household Income ($000s) $43.1 $52.0 $59.1

Household Income: Less than $25,000 (%) 31.7 25.0 21.4

Household Income: $25,000 to $50,000 (%) 28.9 22.9 22.0

Household Income: $50,000 to $100,000 (%) 25.8 26.2 28.1

Household Income: Above $100,000 (%) 13.6 25.9 28.5

Households in Suppl. Nutrition Assist. Program (%) 13.5 10.2 9.2

Share of Households with Public Assistance (%) 4.9 3.9 3.6

Average Public Assistance ($) $4,200 $4,395 $4,410 Source: American Community Survey; Calculaons by Beacon Economics

Council District 10 Drill Down | Los Angeles Forty-seven percent of the district’s residents are Latino, compared to the city-wide average of 49%, while 24% of the district’s residents are African American compared to a city-wide average of 9%.

Figure 4. Racial Proﬁle of District 10 and Los Angeles City Council District 10 City of Los Angeles

Other Hispanic or Latino Hispanic or Latino (all Races) 3% Other (all Races) 47% 49% White 3% 10% White Asian 28% 16% Black Black 9% 24% Asian 11% Source: American Community Survey; Calculaons by Beacon Economics

8 Council District 10 Drill Down | Los Angeles ECONOMIC PROFILE

Approximately 67, 000 people were privately employed by the 2,719 business establishments in the district in the ﬁrst quarter of 2017. On average, employers in District 10 pay $45,859 per annum, compared to $65,651 in the rest of the City. District 10 accounts for 6% of the population of the City of Los Angeles and around 4.7% of employment in the city. Since the ﬁrst quarter of 2008, total employment has grown faster in District 10 than in the City of Los Angeles, although employment growth in the district has leveled off somewhat since 2015. This showdown represents trends in the broader economy: as the economy nears full employment, employment growth will slow down.

Council District 10 Drill Down | Los Angeles Figure 5. Total Employment Change, District 10 and the Rest of the City of Los Angeles

Total Employment Change District 10 and the Rest of the City of Los Angeles

110

Employment grew faster 105 in District 10 than in the City of Los Angeles

100

Employment leveled off since 2015 for District 10 95 Seasonally Adjusted and Smoothed) Indexed Employment (Q1-2008 = 100, 90 Q1-08 Q1-09 Q1-10 Q1-11 Q1-12 Q1-13 Q1-14 Q1-15 Q1-16 Q1-17 District 10 Rest of Los Angeles City Source: California Employment Development Department

As the chart on the following page reveals, there were 250 more business establishments in District 10 in 2017 than during the depths of the Great Recession. The rate of establishment formation has slowed in the most recent periods, which again reﬂects broader trends in the economy approaching full employment. It is also reﬂective of “capacity” constraints.

Employment in District 10 is mostly concentrated in relatively small business establishments. Thirty percent of the employment in the district is in business establishments of 10 people or fewer, compared to the rest of Los Angeles, where only 22% of employment is in establishments of this size. In the rest of Los Angeles, 31% of employment is in establishments of greater than 150 employees, compared to only 14% in CD10.

Council District 10 Drill Down | Los Angeles Figure 6. Business Establishments, Council District 10, 2008 to 2017

Business Establishments, Council District 10, 2008 to 2017 2,800 4.5% 3.7%

3.0% 2.0% 1.9% 1.7% 2,700 1.3% 1.5% 0.8% 0.6%

0.0% 2,600 -1.5% -2.3%

-3.0% 2,500 BusinessEstablishments

NumberBusinessof Establishments -5.1% -4.5% AnnualPercentage Change in Number of

2,400 -6.0% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 No. of Establishments Percentage Change

Source: California Employment Development Department

Council District 10 Drill Down | Los Angeles Figure 7. Employment by Establishment Size, 2017

Employment by Establishment Size

30% Less than 15 Employees 22%

19% 15 to 24 Employees 15%

15% 25 to 49 Employees 13%

23% 50 to 150 Employees 20%

14% More than 150 Employees 31%

0% 5% 10% 15% 20% 25% 30% 35% District 10 City of Los Angeles Source: California Employment Development Department

Below is a map of business establishments by size:

Map 2. Business Establishments by Size, Council District 10

Less than 15 Employees 15 to 24 Employees 25 to 49 Employees

50 to 250 Employees

More than 250 Employees

Council Districts Boundary

Council District 10 Drill Down | Los Angeles 14

Council District 10 Drill Down | Los Angeles Sub-Region Employment Analysis The map below divides the district into three sub-regions:

Map 3. Sub-Regions of Council District 10

Legend

Korea Town Area Central Area Western Area

0 .5 1 2 Miles

Despite being the smallest land area, Koreatown accounts for the majority of the district’s employment. In 2017, Koreatown accounted for 53% of the district’s employment, which is a slight increase from 52% in 2008. Meanwhile, the central area of the district, which has by far the largest land area, accounts for around 35% of employment in 2017, compared to a third in 2008.

Council District 10 Drill Down | Los Angeles Figure 8. District 10 Sub-Regional Employment (Indexed), Q1-2008 to Q1-2017

District 10 Indexed Subregional Employment Q1-2008 to Q1-2007 130

120

110

100

90 Seasonally Adjusted and Smoothed) Indexed Employment (Q1-2008 = 100,

80 Q1-08 Q1-09 Q1-10 Q1-11 Q1-12 Q1-13 Q1-14 Q1-15 Q1-16 Q1-17

Central Koreatown Western Source: California Employment Development Department

The chart above tracks employment change in each sub-region since 2008. The Western area of the district has seen the fastest employment growth rate; because this part of the district has the lowest level of employment, it has the capacity for fastest rates of growth. Employment growth has leveled off in the Koreatown and the Central areas of the district, although it is important to note that at such a micro level of geography, employment change can be volatile in the short term. For example, if a large employer leaves a given area, it can take time for the vacated space to be reused.

Council District 10 Drill Down | Los Angeles EMERGING AND DECLINING SECTORS IN COUNCIL DISTRICT 10

Since 2008, employers in CD10 have added over 5,000 jobs to the district’s economy, while just under 80,000 jobs have been added in the rest of Los Angeles. Overall, administrative support, health care leisure and hospitality, and retail sectors – make up a greater share of local employment in District 10 than is the case for the rest of Los Angeles. By contrast, the economy of the rest of the City of Los Angles is more concentrated in education, information services, manufacturing, and transport and warehousing.

Council District 10 Drill Down | Los Angeles Broad Industrial Proﬁle

In CD10, the health care (25%), leisure and hospitality (17%), and retail (11%) sectors of the economy account for over 50% of employment. Each of these sectors makes up a greater share of employment in CD10 than is the case for the rest of the City. Tables 1 and 2 below outline broad changes to the industrial proﬁle of CD10 and rest of Los Angeles’ economies, respectively.

Table 1. Broad Industrial Proﬁle of Council District 10

Employment Employment Share of Wages in Location Industry Change in 2017 Total 2017 Quotients Since 2008

Administrative Support 5,839 9% $32,591 -1,664 1.31

Education 1,303 2% $39,629 -14 0.57

Financial Services and Real Estate 4,247 6% $60,152 189 0.91

Health Care 16,629 25% $41,229 2,793 1.28

Information 1,985 3% $95,627 97 0.68

Leisure and Hospitality 11,599 17% $32,947 4,536 1.21

Manufacturing 2,178 3% $52,219 -1,647 0.51

Construction 1,951 3% $49,063 658 0.88

Other Services 4,476 7% $38,707 818 1.20

Professional, Scientiﬁc, 6,446 10% $73,658 -119 0.94 Technology, and Management

Retail Trade 7,142 11% $34,279 1,166 1.06

Transport/Warehouse/Utilities 450 1% $55,690 -166 0.15

Wholesale Trade 2,568 4% $70,729 -231 0.80

Total Private 66,813 $45,853 5,100

Source: California Employment Development Department

Council District 10 Drill Down | Los Angeles Table 2. Broad Industrial Proﬁle of the Rest of the City of Los Angeles

Employment Employment Share of Wages in Industry Change Since in 2017 Total 2017 2008

Administrative Support 93,449 7% $44,730 1,259

Education 48,204 3% $70,318 2,125

Financial Services and Real Estate 97,892 7% $121,317 -9244

Health Care 272,586 19% $46,033 79,248

Information 61,253 4% $135,473 -5363

Leisure and Hospitality 201,200 14% $44,274 49,364

Manufacturing 89,258 6% $60,812 -41,411

Construction 46,443 3% $60,625 -6098

Other Services 78,670 6% $41,785 15340

Professional, Scientiﬁc, Technology, 143,707 10% $110,781 -2,859 and Management

Retail Trade 141,163 10% $37,744 652

Transport/Warehouse/Utilities 62676 4% $62,021 4,495

Wholesale Trade 67,280 5% $65,815 -9,008

Total Private 1,403,781 $65,651 78,500

Source: California Employment Development Department

Location quotients (from Table 1 above) can be used to measure the district’s relative strength in an industry compared to the rest of the City of Los Angeles. Location quotients compare the share of employment in a particular sector in District 10 to the share of employment in that sector at the city-wide level. If the location quotient for a given sector is greater than 1, this means the district has a greater share of employment in this sector than the city-wide level, and a smaller share than the City if the number is less than 1. For example, administrative support (location quotient 1.31), health care (1.28) leisure and hospitality (1.21) and retail (1.06) – make up a greater share of local employment in District 10 than is the case for the rest of Los Angeles. By contrast, the economy of the rest of the City of Los Angles is much more concentrated in education, information services, manufacturing, and transport and warehousing.

Council District 10 Drill Down | Los Angeles Growing Industries in CD10 Leisure and Hospitality Leisure and hospitality is the fastest-growing sector in the district, adding around 4,500 jobs to the district’s economy since 2008. This represents an increase of 64% over the period 2008-2017, compared to a 32% increase in the sector for the rest of the city’s economy. Health Care Health care has added around 2,800 jobs in the district, growing 20% over the same period. That said, health care has been growing more slowly in the district than in the rest of the city, where health care employment increased 40%. Retail Retail has added around 1,200 jobs, growing by 19% from 2008 to 2017. The retail sector grew more quickly in the district than in the rest of the City, where employment growth was ﬂat over the period.

Declining Industries in CD10 Administrative Support The biggest sectoral demise has was in administrative support activities, where 1,664 jobs were lost in the district. While administrative support employment fell 25% in the district, it grew 1% in the rest of the City. Note, at micro-levels of analysis, changes can be volatile in the short term, if a particular employer leaves a district. Manufacturing Signiﬁcant losses were also seen in the manufacturing sector, where employment fell 43% in CD10 since 2008, losing around 1,600 jobs. This reﬂects trends in the broader city, where manufacturing employment fell by 32% over the period.

Sub-regional Industrial Variation In Koreatown, leisure and hospitality is the highest-employing sector, followed by health care and professional and scientiﬁc activities. In the Western part of the district, the health care sector is the largest employer, followed by the retail sector. Health care, retail and leisure and hospitality are the three largest sectors in the Central part of the district.

Council District 10 Drill Down | Los Angeles Figure 9. Share of Employment by Industry, Q1-2017

Share of Employment by Industry Share of Employment by Industry District 10, Q1-2017 City of Los Angeles, Q1-2017 4% 5% 1% 9% 4% 7% 2% 3% 11% 6% 7% 10%

10% 10% 19% 7% 25% 6% 3% 3% 3% 4% 6% 17% 3% 14%

Administrative Support Education Financial Services and Real Estate Health Care Information Leisure and Hospitality Manufacturing Construction Other Services Prof, Sci, Tech, and Mgmt Retail Trade Transport/Warehouse/Utilities Wholesale Trade

Source: California Employment Development Department

Health Care (25%), Leisure and Hospitality (17%), and Retail Trade (11%) were the largest industries in Council District 10 in the ﬁrst quarter of 2017 and had higher shares of employment compared to the City of Los Angeles.

Council District 10 Drill Down | Los Angeles Figure 10. Employment Growth by Industry, 2008 to 2017

Council District 10 City of Los Angeles

Leisure and Hospitality Construction Other Services Health Care Retail Trade Information Financial Svcs and Real Estate Education Prof, Sci, Tech, and Mgmt Wholesale Trade Administrative Support Transport/Warehouse/ Utilities Manufacturing -50% -30%-10% 10% 30% 50% 70% -50% -30% -10% 10% 30% 50% 70% Employment Percent Change Employment Percent Change (Seasonally Adjusted) (Seasonally Adjusted)

Source: California Employment Development Department

Council District 10 Drill Down | Los Angeles WAGE ANALYSIS OF BROAD INDUSTRIES

On average, employers in District 10 pay wages of $45,859 per year, compared to $65,651 in the rest of the city. The gap in wages between District 10 and the rest of the City has been growing since 2008: in 2008, industries in the City paid wages that were 39% higher than those in District 10, compared to 43% in 2017. The reason for this difference is two- fold. First, Council District 10 has a higher proportion of lower-paying industries than is the case in the rest of the city. For example, Council District 10 has a higher share of employment in the health care sector, which typically pays lower wages than in the rest of the economy. In 2017 in Council District 10, the sector paid $41,229 compared to the economy-wide average of $45,853 for the district. Council District 10 also has a higher share of employment in the leisure and hospitality sector, which is again a relatively low-paying sector of the economy. The sector in the district pays workers $32,947 per year. In comparison, the City of Los Angeles has a higher proportion of workers in relatively better-paying sectors of the economy, such as information, where the average salary is $135,261; manufacturing, where the average wage is $60,812, and transportation and warehousing, which pays a salary of $62,021. Beyond sectoral differences, within industries the rest of L.A. is engaged in higher-paying activities than is the case in Council District 10. For example, the ﬁnancial services industries in Council District 10 pay an average wage of $60,152 compared to $121, 317 in the rest of Los Angeles. This will be discussed further in the next section.

Council District 10 Drill Down | Los Angeles Figure 11. Average Wages by Broad Industries, 2017

Average Wages by Broad Industries Council District 10 and the City of Los Angeles $135 $140 $121 $111

$105

$96 $70 $66 $66 $70 $61 $61 $62 $74 $71 $46 $45 $60 $44 $42 $38 $56 $52 $49 $35 $46 $40 $41 $39 $33 $33 $34 Average Annual Wages (in Thousands) (in AnnualWages Average $0 Education Information HealthCare Retail Trade Retail Total Private Total Construction andMgmt Manufacturing Other ServicesOther Utilities RealEstate Prof, Sci, Tech, Tech, Sci, Prof, Wholesale Trade Wholesale FinancialandSvcs Transport/Warehouse/ AdministrativeSupport Leisureand Hospitality

Council District 10 City of Los Angeles Source: California Employment Development Department

Figure above illustrates that average wages per annum are lower in all broad industries except for Warehouse Trade in Council District 10 than in the City of Los Angeles. Average annual wages in the Wholesale Trade industry are 7% higher in Council District 10 than in the City of Los Angeles.

Council District 10 Drill Down | Los Angeles DETAILED INDUSTRY ANALYSIS

While the broad industry categories analyzed above provide an incredibly useful snapshot of a given economy, they can mask signiﬁcant details of the district’s economy. For example, the ﬁnancial services sector of the economy covers a broad swath of activities ranging from branch retail banking to securities trading. Likewise, the manufacturing sector of the economy covers a range of activities from apparel production to the manufacture of spacecraft. Drilling down within particular sectors provides a more nuanced perspective of the district’s economy.

Health Care Drill Down As discussed above, the health care sector makes up 25% of all employment in District 10. Table 3 below details the subsectors of the industry that hire the highest number of workers in both CD10 and the rest of Los Angeles. In both CD10 and the rest of the City, individual and family services employ the highest number of workers. This is a relatively low-paying sector of the industry, paying an annual salary of $17,488 in CD10 in 2017. Beyond this similarity, the health care sector in CD10 is qualitatively different from the sector in the rest of the City. In the rest of L.A., more employment is concentrated in higher-paying elements of the industry, such as outpatient centers and general medical and surgical hospital supplies.

Council District 10 Drill Down | Los Angeles Table 3. Employment Within the Health Care Sector

Employment Wages

Individual and family services 7,340 $17,488

Nursing care facilities 1,380 $33,901

Home health care services 827 $29,329

Ofﬁces of dentists 622 $37,681

Ofﬁces of physicians 602 $57,521

Employment Wages

Individual and family services 96,133 $16,160

General medical and surgical hospital supplies 46,306 $83,922

Outpatient care centers 24,892 $81,569

Ofﬁces of physicians 21,234 $78,190

Nursing care facilities 17,876 $35,825 Source: California Employment Development Department

Leisure and Hospitality Drill Down Leisure and hospitality makes up the second largest share of employment in CD10, accounting for 17% of employment. Over 75% of the employment within this sector is concentrated within restaurants. Above, leisure and hospitality was identiﬁed as the fastest- growing sector of the economy in Council District 10. Consider that since 2008, employment in restaurants in CD10 almost doubled. Restaurants are the fastest-growing employers in the district. In fact, since 2008, 5,100 jobs were added to the CD10 economy. Over this time, 4,396 jobs were added by the district’s restaurants.

Council District 10 Drill Down | Los Angeles Administrative Support Services Drill Down Administrative services accounted for the highest number of job losses in the district since 2008, with employment in the sector falling by 1,664 jobs, or a decline of 28%. At the same time, the sector grew in the rest of Los Angeles, adding over 1,200 jobs over this time. Employment losses were especially pronounced in the travel arrangement and employment services subsectors. However, travel arrangement is an especially well- paying employer in the district, paying an average salary of $88,000

Table 5. Employment Within the Administrave Support Services Sector

Employment Change Wages in 2017 Since 2008

Employment Services $27,942 -518

Ofﬁce Administrative Services $40,242 -388

Services to Buildings and Dwellings $22,232 -222

Travel Arrangement and Reservations $88,359 -640 Source: California Employment Development Department

Council District 10 Drill Down | Los Angeles Locally Focused Economy Beyond individual sectors, an economy can be divided up according to whether its activities serve local or distant populations. The restaurant sector is an example of an industry that primarily serves local residents. By contrast, motion pictures, which are produced in Los Angeles are primarily consumed by people from outside of the regional economy. Council District 10 has a larger share of employment in local-serving industries than in the rest of the City of Los Angeles. In District 10, 75% of employment in 2017 was focused in locally oriented industries. In the rest of the City of Los Angeles, only 62% of employment was in such industries. Locally serving industries, on average, pay lower wages than industries that serve distant locations. This again helps to account for the difference in wages paid by employers in District 10 and the rest of the City.

Figure 12. Local and Traded Employment, 2017

Council District 10 City of Los Angeles 100 100

75 75

50 50

25 25

0 0 2011 2008 2009 2010 2012 2013 2014 2015 2016 2011 2008 2009 2010 2012 2013 2014 2015 2016 2017 YTD 2017 Local Traded Other Local Traded Other YTD 2017 Source: California Employment Development Department

Council District 10 Drill Down | Los Angeles CONCLUSION

Overall, Council District 10 has recovered from the depths of the Great Recession. Today, there are 5,000 more people employed in the district’s economy than in 2008. The district’s economy is primarily specialized in the healthcare, leisure and hospitality, and retail sectors of the economy, which tend to be relatively low-paying sectors. Council District 10 can shape many aspects of its local economy. The district can influence the amount of commercial and industrial development in its borders through zoning, and the type of commercial activity that is permissible. As such, in the long run, the growth of the district’s economy will be influenced by the amount of land that is made available for commercial and industrial development: if the amount of land available for such activities does not increase, the number of jobs in the community will be capped at a certain level. In some areas, the district is beholden to larger macroeconomic forces. Council District 10, for example, cannot control global trends in the manufacturing sector. Over time, the sector has become more automated, more efficient and more footloose across regions and countries. Each of these factors have suppressed employment levels in the industry within the U.S.. In this regard, the district should be cognizant of broader macroeconomic trends, and be flexible when it comes to repurposing land for other activities. Council District 10 cannot change macro trends, but it can repurpose land zoned for declining sectors of the economy to some other use.

Council District 10 Drill Down | Los Angeles Council District 10 Drill Down | Los Angeles BEACON ECONOMICS

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