Can We Bring Manufacturing Back to California? Here’s What It Would Take
Once upon a time, California was the beating heart of
American manufacturing. From aerospace in El Segundo to semiconductors in
Silicon Valley, the Golden State built things—big, bold, world-changing things.
But over the past three decades, factories have shuttered, jobs have moved
overseas, and California has become better known for exporting ideas than
importing machinery.
Now, the tides are shifting.
COVID-19 exposed the fragility of global supply
chains. Container ships stacked outside the ports of Los Angeles and Long Beach
reminded us just how far we’ve outsourced our productive capacity. Talk of
“reshoring”—bringing manufacturing back to the U.S.—became more than just
political rhetoric. For a moment, it felt like American industry was ready to
make a comeback.
And yet, here in California, that comeback has been
more sizzle than steak.
So what’s standing in the way?
Let’s start with the obvious: cost. Industrial land in
California is among the most expensive in the country. In Southern California,
you’re lucky to find dirt under $50 per square foot—and in many infill areas,
it’s well north of that. Add in construction costs, utilities, taxes, and the
dreaded “soft costs” of entitlement and permitting, and your manufacturing
project might collapse before you ever pour a slab.
But cost is only part of the equation.
Manufacturers also face a regulatory labyrinth. CEQA,
AQMD, CARB—if you know those acronyms, you probably also know how difficult it
is to get an industrial use permitted in this state. Even clean, tech-enabled
operations must navigate lengthy environmental reviews that can stretch on for
years.
And then there’s labor. California offers a deep
talent pool—but it comes at a price. Employers must contend with one of the
most complex labor codes in the nation, high workers’ comp premiums, and rising
minimum wages. For many, it’s easier to head to Nevada, Arizona, or Texas,
where the cost of doing business is lower and the red tape is less suffocating.
So, if we truly want to bring manufacturing back—not
just to America, but to California—we have to get serious. That means
addressing five key areas:
1. Regulatory Reform
Streamline environmental review for industrial
projects, especially those involving clean or advanced manufacturing.
Fast-track permits for uses that reduce emissions and create living-wage jobs.
2. Strategic Incentives
Offer tax credits, relocation grants, and training
subsidies that reward companies for building here. Compete with other
states—not on ideology, but on economic viability.
3. Energy Reliability
Manufacturing requires power—lots of it. California
must ensure its grid can handle industrial demand without rolling blackouts or
punishing peak rates.
4. Industrial Land Preservation
Zoning is destiny. Too often, cities rezone industrial
land for higher-tax retail or residential uses. If we want jobs, we need to
protect the land where jobs happen.
5. Workforce Development
Invest in vocational education, community college
partnerships, and apprenticeships. We must rebuild the talent pipeline that
once made California a manufacturing powerhouse.
We do have some bright spots. Tesla, against all odds,
continues to operate in Fremont. In the Inland Empire, logistics has
exploded—proving that goods still move through California even if they aren’t
made here. But let’s be clear: we’ve missed major opportunities. Semiconductor
plants are being built in Arizona, not Anaheim. Battery gigafactories are
opening in Nevada, not Norwalk.
Manufacturing won’t return on sentiment alone. It will
take political courage, private investment, and a willingness to rethink how
California supports its industrial base. We’ve done it before. We can do it
again.
The question is: do we really want to?
No comments :
Post a Comment