Oakland: Economy

Oakland: Economy

Major Industries and Commercial Activity

Oakland's leading industries are business and health care services, transportation, food processing, light manufacturing, government, arts, culture, and entertainment. The Port of Oakland is one of the busiest ports in the world for container ships. Nearly 200,000 jobs are related to the movement of cargo through Oakland marine terminals. Chief exports at the port include fruits and vegetables, waste paper, red meat and poultry, resins, chemicals, animal feed, raw cotton, wood and lumber, crude fertilizers/minerals, industrial machinery, and cereal. Oakland's principal imports include auto parts, computer equipment, wearing apparel, toys, games and items made of plastic, processed fruits and vegetables, fasteners and household metal products, red meat, pottery, glassware and ceramics, iron and steel, beverages, and lumber products.

Oakland is an important commercial center. Approximately 13 percent of Oakland's work force is employed in the wholesale and retail trade. The city has hundreds of manufacturing plants employing almost 9 percent of the city's workers. Shipbuilding has flourished along the city's inner harbor. Other major industries include electrical equipment, chemicals, glass, automobiles and trucks, and pharmaceuticals. Oakland's leading industry sectors include business services, health care services, transportation, food processing, light manufacturing, government, arts, culture and entertainment.

Oakland's business community faced some major problems in the 1980s and 1990s. The Loma Prieta Earthquake in 1989 not only caused physical damage but caused many companies to consider relocation. Although Alameda County had economic growth in the 1980s, Oakland did not participate in that growth and the economy actually declined. Major plant closures in the late 1980s and 1990s included Gerber Products, General Electric, National Lead, American Can, and Oakland's largest manufacturing facility, Transamerican Delaval, which had employed 1,600 workers. The ripple effect of these closures led to the closing of many small businesses that had been suppliers to these firms. The city received a designated Urban Enterprise Zone to help alleviate the employment situation, particularly for inner city residents. By the late 1990s Oakland's economy was showing some vitality. In 2002, Oakland was ranked the 8th best city in the nation for business in the Forbes annual survey of the Best Places in America for Business and Careers. In the mid-2000s, Oakland benefited from a strong and diverse business environment. Among its major corporations were Clorox, Kaiser Permanente, Cost Plus, Dreyer's Grand Ice Cream, APL Limited, and Rainin Instruments. According to the Landauer Realty Group, out of the 60 largest office markets in the United States, Oakland was expected to have the strongest market for the next several years.

Items and goods produced: processed foods, transportation equipment, fabricated metal products, non-electrical machinery, electrical equipment, clay and glass products

Incentive Programs—New and Existing Companies

Local programs

The city of Oakland's Business Development Office assists businesses in getting established, finding suitable locations, and in expansion and growth. Oakland's Development Action Team works directly under the mayor and city manager to streamline all economic development, redevelopment, planning, zoning, building services, and housing development processes in support of key development projects. Incentives range from an industry-specific business tax abatement program to assistance with locating space and identifying its workforce. Oakland takes full advantage of existing state and federal programs to provide a full set of incentives and has a municipal lending unit to assist businesses looking for capital, technical assistance, and training. Oakland has been designated as an Enhanced Enterprise Community (EEC), a designation that allows businesses that hire from the EEC zone to be eligible for federal tax incentives including the Work Opportunity Tax Credit and the Welfare to Work Tax Credit. The Industrial Development Bond Program, Manufacturers's Investment Credit, and the Retail and Entertainment Catalyst Tenant Improvement Program (TIP) are among other financial incentives for bringing businesses to the city. Incentives are also provided for environmentally-friendly businesses through a Sustainable Development Initiative. Financial assistance programs for improving neighborhood commercial districts include the Business Improvement District Assistance program and the Commercial Property Faćade Improvement Program. The Oakland Business Development Corporation provides loans to small businesses who may not qualify for traditional bank financing. Brownfields programs including the Cal ReUSE Environmental Site Assessment Loan Program, Oakland Brownfields Revolving Loan Fund, and the Urban Land Redevelopment (ULR) Program provide incentives for reutilizing brownfields which are underutilized sites where reuse is complicated by the threat of environmental contamination.

State programs

The Oakland Urban Enterprise Zone and Oakland Foreign Trade Zone offer state and federal tax incentives. The state of California's Recycling Market Development Zone (RMDZ) Program helps create the markets necessary to use recycled materials and helps companies retool to produce goods from the discarded materials. The Oakland/Berkeley RMDZ is one of twelve located in California. The zone encourages the retention, expansion, and attraction of recycling businesses by offering a recycling equipment state tax credit of up to $250,000; low-interest loans of up to $1 million; engineering and technical assistance; and marketing assistance for the goods produced.

Job training programs

The city of Oakland serves as the liaison between new and existing companies and all of the educational and training organizations in the East Bay, including Peralta Community College District Partnership, Oakland Higher Education Center, Eastbay Works One-Stop Career Center, Department of Adult Education, Alameda County Workforce and Resource Development, and the Private Industry Council. The Oakland Workforce Investment Board offers a multitude of assistance and training opportunities to assist small businesses in recruiting a qualified workforce.

Development Projects

In 2005, more than 60 major development projects were underway in the city of Oakland. More than $50 million has been invested to turn the Old Oakland historic district into a sophisticated turn-of-the-century retail and commercial area, while preserving each building's ornate Victorian facade. Jack London Square, a popular waterfront retail and entertainment district, was completed in 2002 and features 10 restaurants and cafes and 12 specialty retail shops. The Wood Street Development Project is a redevelopment of the former Central Station, warehouses, and signal tower into 1,570 housing units, retail shops, and non-retail commercial space. The "Oak to Ninth" project is a 10-year redevelopment of 62 acres of waterfront property owned by the Port of Oakland. Plans call for the construction of 3,100 residences, commercial space, structured parking, approximately 27 acres of public open space, 2 renovated marinas, and a wetlands restoration area.

The Port of Oakland's $500-$600 million Vision 2000 program will expand and improve marine terminals and develop transportation infrastructures. Two new maritime terminals will be developed, as well as a new intermodal rail facility. The Port of Oakland and the U.S. Army Corps of Engineers are working together on a harbor deepening project to accommodate the new generation of container vessels arriving in Oakland. Other slated projects include widening and deepening the harbor entrance, the outer and inner harbor channels, and two turning basins to 50 feet, as well as relocating utility lines. The Port is also deepening its berths and strengthening its wharves as part of the project. All dredged material is being reused to restore Bay Area wetlands.

Economic Development Information: City of Oakland Business Development Office, telephone (510)238-3627; toll-free (877)2OAKLAND. Oakland Metropolitan Chamber of Commerce, 475 14th Street, Oakland, CA 94612-1903; telephone (510)874-4800; fax (510)839-8817

Commercial Shipping

The Port of Oakland is the 4th largest container port in the United States and 20th in the world. The Port of Oakland occupies 19 miles on the mainland shore of San Francisco Bay, one of the finest natural harbors in the world. There are 10 container facilities, 20 deepwater berths, and 35 container cranes. On-dock storage space exceeds 600,000 square feet. Major expansion of the port was under way in 2005 to expand the port's capabilities. The port's facilities are backed by a network of local roads and interstate freeways, warehouses, and intermodal railyards. Oakland offers direct, competitive rail service to the Midwest and Atlantic and Gulf coasts for Overland Common Point, micro-bridge, and mini-landbridge service via the two railroads that serve the port. All major carriers serve the port and many maintain terminals in the harbor area.

Air freight through Oakland International Airport totals more than 1.4 billion pounds, and more than 76 million pounds of air mail pass through the airport each year.

Port Information: Port of Oakland, 530 Water St., Oakland, CA 94607, telephone (510)627-1100.

Labor Force and Employment Outlook

The Oakland labor force is described as skilled, educated, and available to employers who need managerial/executive, professional, sales, technical, and clerical staff. Nearly one-third of area residents have a college degree, and about 100,000 students attend local institutions of higher learning. Although the Oakland area benefits from a diverse economic base, it suffered a loss of 50,000 jobs from 2001 to 2004, according to the Economic Development Alliance for Business. However, a rebounding economy in 2005 was expected to add 12,500 jobs in the East Area, with further gains in 2006. Employment growth rates through 2015 will be highest in the area of manufacturing.

The following is a summary of data regarding the Oakland metropolitan area labor force, 2003 annual averages.

Size of non-agricultural labor force: 1,024,700

Number of workers employed in . . .

natural resources and mining: 800

construction: 67,200

manufacturing: 97,400

trade, transportation and utilities: 198,000

information: 32,300

financial activities: 67,900

professional and business services: 143,400

educational and health services: 117,400

leisure and hospitality: 80,600

other services: 37,700

government: 182,100

Average hourly earnings of production workers employed in manufacturing: $18.33

Unemployment rate: 4.3% (December 2004)

Largest private employers (East Bay)	Number of employees
Kaiser Foundation Health Plan Inc.	22,500
SBC Communications Inc. (Pacific Bell)	10,132
Alameda County	9,638
University of California at Berkeley	9,168
Contra Costa County	8,467
U.S. Postal Service, Oakland District	8,283
Lawrence Livermore National Lab	7,837
Safeway Inc.	7,680
State of California	7,600

Cost of Living

The following is a summary of data regarding key cost of living factors for the Oakland area.

2004 (3rd Quarter) ACCRA Average House Price: $647,278

2004 (3rd Quarter) ACCRA Cost of Living Index: 152.3 (U.S. average = 100.0)

State income tax rate: Ranges from 1.0% to 9.3%

State sales tax rate: 6%

Local income tax rate: None

Local sales tax rate: 1.25%

Property tax rate: ranges from 1.22% to 1.3773% of assessed values (2005)

Economic Information: Oakland Chamber of Commerce, 475 Fourteenth Street, Oakland, CA 94612-1903; telephone (510)874-4800