L.A.'s unemployment is 13.4%, meaning 259,000 people are out of work. In response, the mayor plans to target three sectors for job growth: biotechnology, clean technology companies and entertainment.
Whether talking about electric cars or his much-promised "Subway to the Sea," Los Angeles Mayor Antonio Villaraigosa has reworked his message during his second term to focus on a single overriding goal: jobs.
With more than a quarter-million residents of his city out of work, the mayor has put a new emphasis on job creation after spending much of his first four-year term focused on a spectrum of policy issues such as the environment, education and crime.
"I think this is a new appreciation at City Hall for the importance of jobs, since we have lost 340,000 in Los Angeles County since January 2008," said Gary L. Toebben, president of the Los Angeles Area Chamber of Commerce.
Even the business leaders recently picked by Villaraigosa to shepherd a new jobs initiative say the mayor's administration did not pay enough attention to the economy during his first term. One advisor, former Mayor Richard Riordan, said initiatives such as Villaraigosa's clean-air program at the Port of Los Angeles put some truck drivers out of work.
"They moved too quickly," said Riordan, selected by the mayor to head a team of volunteer economic advisors to spur job growth. "You're getting environmentalists and unions going in for their piece of the pie without looking at the fact that people are starving in the meantime. If you're destroying the lives of poor people, you have to step back."
Strategic plan
On Wednesday, Los Angeles County supervisors adopted a sweeping strategic plan for economic development, but how it will be implemented remains a work in progress. Indeed, the influence that any public official -- even a president -- has on delivering jobs or mending an ailing economy remains debatable. Local business leaders and economists nevertheless praise Villaraigosa for making job and economic growth the top priority of his second term.
Russell Goldsmith, president of Los Angeles-based City National Bank, said he was encouraged by Villaraigosa's recent shake-up of his administration, bringing in a team more devoted to making L.A. friendlier toward business.
Goldsmith said the mayor's decision to name Riordan, along with billionaire philanthropist Eli Broad and other business leaders, for his new team of volunteer economic advisors showed that he was willing to reach outside his own political comfort zone.
"There are so many great resources in Southern California that can be leveraged . . . to grow jobs," Goldsmith said. "I absolutely think the actions of government, at every level, can and do make a difference."
Los Angeles could start by using the Department of Water and Power to attract new businesses by offering reduced electricity costs, he said. L.A. also controls the two biggest economic drivers in Southern California, Los Angeles International Airport and the Port of Los Angeles.
Two years ago, Goldsmith chaired a Villaraigosa-appointed "economy and jobs committee" that in 2008 released a detailed plan to use those city facilities, along with dozens of other measures, to improve the business climate. But those recommendations were met largely with "indifference" by the City Council, he said.
Business leaders say that, too often, both the mayor and council are distracted by their own political interests and issues such as billboard regulation or medical marijuana dispensaries -- even the city's costs for the Michael Jackson memorial -- and pay scant attention to less-glamorous government work such as tax reform or weeding out bureaucracy.
For more than a year, city officials have failed to address complaints from "new media" companies such as the shopping website Shopzilla, which the city reclassified as a professional services firm and socked with a more than tenfold increase in city business taxes.
"That's not right," Toebben said. "And that doesn't have anything to do with the national economy."
Streamlined process
Another notable failure that business leaders point to was the mayor's unfulfilled promise to streamline the permit process for new buildings by slashing the number of review agencies from 12 to two.
This week, Villaraigosa pledged to rectify that through his new appointee to lead the city's Department of Building and Safety, Deputy Mayor of Economic Development Robert "Bud" Ovrom.
The Villaraigosa administration plans to target three primary sectors of the economy for its jobs initiatives: biotechnology firms, clean technology companies and the entertainment industry. As part of that, the city probably will use financial incentives from the DWP and the city's redevelopment agency to lure companies with more affordable power and real estate and also reassess and streamline the permitting process.
Already, Villaraigosa has ordered department heads to make it easier for production companies to film on city properties, part of a renewed effort to stem runaway production.
"He's retooling his economic development team to move away from real estate development to a really heavy focus on job creation and job retention," said Jay Carson, deputy chief of staff, a newcomer to City Hall who has worked as a political aide to Hillary Rodham Clinton and on economic development for New York Mayor Michael Bloomberg.
Tax incentives
City Council President Eric Garcetti said the council would consider offering tax incentives for companies that create new jobs and is expected to set aside money to hire an economic analyst to review all proposed ordinances to determine how they would affect the city's job market. Garcetti said both proposals may come with an upfront expense, a difficult challenge for a city facing a $98-million budget shortfall. But he argued that both would pay dividends for the city and job growth.
"It's a desperate situation out there," Garcetti said. "If we don't act in a situation like this, when will we act?"
The mayor acknowledges, however, that the city alone does not have the tools to drive a recovery given the degree of the economic crisis: Unemployment within the nation's second largest city is 13.4%, meaning that 259,000 people are out of work.
"We're looking at numbers, in terms of the unemployed, that we haven't seen in decades," Villaraigosa said at a recent news conference with U.S. Secretary of Labor Hilda Solis at Los Angeles Trade-Technical College. "We're not going to do this overnight. This is a problem of immense proportions."
To jump-start job growth, Villaraigosa said he plans to seek federal funds and approvals to accelerate major transportation projects, including the "Subway to the Sea" Red Line extension to Westwood.
The mayor also said the city is using federal stimulus money, in partnership with local colleges, to support workforce training programs keyed to industries that are expected to start hiring when the economy recovers: healthcare, hospitality and entertainment and "green" jobs in renewable energy and energy efficiency.
Larry Frank, the deputy mayor of community and neighborhood services, said all of those efforts would help put people back to work. But recovery will be slow for a city that is already grappling with higher poverty rates and a larger unskilled workforce -- 40% of the workers have an eighth-grade reading level or below -- than the region as a whole.
"We can solve L.A.'s problems in the tens of thousands," Frank said. "The problem is, L.A.'s problems are in the hundreds of thousands."
