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Importance of Logistics to Southern California

Learn about the logistics flow of goods, industrial vacancy rates, growth rates, and the impact on the economy in Southern California. Explore the significance of logistics in job creation and economic growth.

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Importance of Logistics to Southern California

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  1. Importance of Logistics to Southern California John Husing, Ph.D. Economics & Politics, Inc.

  2. Logistics Flow of Goods

  3. Imported Container Volume Returning

  4. Fulfillment Warehousing

  5. E-Commerce Growth RatesYear Over Year by Quarter

  6. Industrial Vacancy Rate Recovering Everywhere! 2005/2006 2009Q3 2016Q1 San Diego 7.0% 12.0% 4.4% Inland Empire 2.7% 12.8% 4.0% Orange Co. 5.4% 6.5% 1.8% L.A. Co. 2.1% 3.2% 1.2%

  7. Industrial Construction Four Qtrs. IE Net Absorption: 17.4 million Sq. Ft.

  8. Absorption: Inland Empire Running Four Quarters 21.8 million SF

  9. Inland Empire Logistics Jobs

  10. Los Angeles Co. Logistics Jobs

  11. Calculating Median Income Median: 50% of Workers Make More, 50% Less Not Skewed by Abnormally High Pay • 155 Different Occupations • Known Share of Jobs in Each Occupation • Known Median Income in Each Occupation • Known Education Requirements for Each Occupation • Source: CA Employment Development Department

  12. Median Pay By Sector Groups

  13. Educational Requirements For 155 Occupations 83.4%

  14. Educational Level To Obtain First Job& Median Income 0.04% 4.1% 10.5% 0.8% 1.1% 63.3% 20.1% Once In Sector, Workers Can Use OJT to Migrate Up Skill Ladders

  15. Public Policy Issues

  16. IOOs v. Company Drivers • Net Median Income IOOs: $59,478 v. $42,078 CA Employees • Top 25% $110,087 • 2nd 25% $ 68,936 • 3rd 25% $ 47,005 • Last 25% $ 28,297 • Net Income Closely Related to Level of Effort As Measured by Mileage Driven Determined by Entrepreurial Drivers • Several Costs are Fixed … IOOs with Less Miles, Turns, Containers Find Net Income Hurt Most by Cost • 2013 Gross Income of $138,651 more than 2012’s $104,536 • As CA Economy Much Stronger in 2013 than 2012 IOOs With High School or Less Educations … Net Earnings More Than Other Logistics Occupations Depending on Chosen Level of Effort

  17. Inland Rail Port

  18. Cargo On Huge ShipsFlood The Ports With Containers

  19. I.D. Inland Empire When Loaded • Unload to “Bomb Cart” • Bring To Rail • Load on to 5 Well Rail Cars • Form 20 Car Train With 200 Container

  20. 5. Haul To The Inland Empire

  21. 6. Unload In Inland Rail Yard

  22. 7. Truck Container To Distribution Center

  23. Results • Remove 400 Trucks from Freeways L.A.-I.E. Per Round Trip • Increase Speed of Throughput • Increase Reliability of Throughput • Decrease Cost Compared to Truck Dray to IE • Change due to 74% Increase in Truck Drayage Costs

  24. Poverty & Middle Class

  25. Adults With High School Or Less Educations

  26. Share Living In Poverty

  27. Key Determinants of Public Health California Priority • Socio-Economics 40% • Population’s Health Behaviors 30% • Access to Medical Care 20% • Environmental 10% 90% Source: Different Perspectives For Assigning Weights To Determinants of Health, University of Wisconsin, Public Health Institute, 2010

  28. Median Pay By Sector Groups

  29. California Priority Single Issue Regulatory Agencies CA Air Resources Board South Coast Air Quality Management District CA Environmental Protection Agency CEQA SB 350 50% Renewables Regulatory Philosophy … Job Concerns Are Not Our Problem!

  30. Nestle to close Valley food Plant 360 California jobs will be lost as Hot Pockets production goes to Kentucky BUSINESS Thursday, August 7, 2014 LATIMES.COM/BUSINESS :: “In higher skilled industries they are hesitant to move because the labor force is not available anywhere. But lower-skilled one, they have an easier time leaving. That trend in California has the potential to leave lower-educated workers behind.

  31. Low Income and Minority Workers Paying The Heaviest PriceFor State Policies . . . They Suppress Jobs Leading To The Middle Class

  32. Yet . . .

  33. PM 2.5: Diesel Pollution -95.6% 225.7 Million Sq. Ft. of Net New Logistics Facilities

  34. Political Keys • Show Democrats from Poor Districts Their Party is Hurting Their Constituents • Combined With Republicans Create Legislation Rolling Back Regulators • CEQA - Sustainable Freight Strategy • AQMD • CARB • EPA (Federal) • SB 350 Victory on Petroleum Demonstrates Potential

  35. www.johnhusing.com

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