LA Still Tops in Manufacturing

LOS ANGELES-Despite the well-publicized aerospace cutbacks of the last decade, this county retains its position as the largest manufacturing area in the nation, with its 643,400 manufacturing jobs last year edging out second-place Chicago.

That’s the good news from the Los Angeles Economic Development Corp. The bad news is that—due in large part to those aerospace cutbacks, and a nettlesome shortage of commercial manufacturing space for sale or rent–the 643,400 figure is a whopping 243,800 under the peak manufacturing job year of 1987, when 887,200 such jobs drove the county’s economy.

Chicago, which held the top position in the nation from 1994 to 1996, had 639,500 manufacturing jobs last year, says Ken Ackbarali, an LAEDC economist. Detroit had 446,800, followed by Philadelphia with 303,200 and New York with 302,100. Ackbarali notes that LA County has about 9.7 million residents and will pass the 10 million mark in 2001.

South Los Angeles and the San Gabriel Valley ranked first and second, respectively, with manufacturing jobs, says Jack Kyser, the nonprofit group’s chief economist. The San Fernando Valley represents the third-largest concentration of manufacturing jobs, he says.

Thanks to a skilled and ample labor force—the latter factor not as common in places like Chicago—LA County will continue to thrive as a manufacturing center, Kyser adds. The labor force is constantly replenished by a steady flow of immigrants, legal and otherwise, he observes.

One restraint on industrial growth in the LA Basin is the lack of land for expansion, notes Cody Plott, president of Downtown-based brokerage Colliers Seeley. The industrial vacancy rate in the LA area is already below 4% and dropping, with much of the space that will become available in the relatively small number of projects slated to come online next year already leased.The shortage of good space is forcing many manufacturers to the Inland Empire, where land prices and wages alike are much lower, broker Plott says.