Nonprofit recommends changes based on study of Central Valley economy

Central Valley leaders must strike a balance between protecting agriculture and diversifying the regional economy to generate the jobs residents need, the Great Valley Center suggests in a report.

The center, a nonprofit think tank, analyzed the economies of the 19 counties that make up the San Joaquin and Sacramento valleys, an effort it undertakes every five years.

It found that the valley leads the nation in agricultural production but lags far behind in income. The per capita income for valley residents is $29,790, 29 percent below the state average of $41,805. The valley's per capita income would rank 48th in the nation if the region was a state, the center wrote.

Also, Uncle Sam spends less on Central Valley residents than it does elsewhere. The center wrote that California residents get 89 percent of the federal government's nationwide average per capita spending. Central Valley residents receive 64 percent of the national average.

The center quantified the impact of the region's housing bust, recording a 404 percent decline in new residential building permits between 2005 and 2008.

Those figures were even worse in the Northern San Joaquin Valley. The number of building permits fell by 853 percent in Merced, San Joaquin and Stanislaus counties.

"Whereas in the past we asked if valley residents were able to afford buying and owning a house, we now measure how many families are losing their homes to foreclosures," Great Valley Center President David Hosley wrote in an introduction to the economic report. "Addressing these challenges will require sustained, concentrated effort throughout the valley."

Still, the Great Valley Center anticipates long-term population growth for the valley, citing estimates from the state and the Public Policy Institute of California. The valley grew by 15 percent between 2000 and 2008, a rate 4 percent greater than the state's.

The center's recommendations to boost the valley's economy are to:

Improve the valley's labor pool with job training and education to generate more skilled workers. The center found that valley workers earn less than their counterparts around the state in every field, especially in information-related occupations.

Support agriculture, the staple of the region's economy. The region lost 4.9 percent of its prime farmland — 35,488 acres — to development between 2000 and 2006. Agriculture provides 10 percent of the region's jobs, down from 20 percent in 2004.

Diversify the valley's economy by supporting clean technology, health care, energy and renewable fuels. The region's steepest declines in jobs since 2003 occurred in trades, transportation and utilities. It saw its greatest gains in education and health care.

Capitalize on federal economic stimulus money to draw more government and nonprofit spending. Valley nonprofits earn just 56 percent of the average revenues received by their counterparts across the nation.

Know unique needs of rural communities, which are often overlooked by government and investors.

Amy Moffat, the center's director of research and communications, said the report should be used by valley nonprofits and local government agencies to make appeals for more funding to help the region.

"Now is the time for nonprofits to be asking," she said.

Bee assistant city editor Adam Ashton can be reached at or 578-2366.