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Industrial Drivers of California’s Critical Knowledge-Based Industries

California’s economic success is dependent on its core industries, a set of globally competitive, export-oriented or service-driven business drivers that reflect the diversity of the state’s economy and fuel its growth. While some are regionally focused, others are important sources of innovation and growth across the state. To remain competitive, each of these industrial drivers relies on a highly skilled, adaptable workforce. The CSU cultivates partnerships with industry leaders in each of the sectors, on a systemwide basis or through campus advisory councils.

Accounting for nearly 5 million jobs, the following seven industries drive California’s economic growth:

  • Agriculture. Food and Beverages—This sector represents one of the largest, most pervasive industries in the state. Nearly every region (as it is defined in this report), except Los Angeles, has some specialty in agriculture. California’s more than 200,000 agricultural employees provide a significant portion of the nation’s produce and represent the center of American winemaking.

  • Information Technology and Electronics—The Bay Area’s Silicon Valley is famous as the birthplace of dozens of the world’s premier technology firms and as a hub of technological entrepreneurship. Additionally, aerospace engineering in Southern California and telecommunications work in San Diego represent high-tech industrial hubs. About 750,000 programmers, engineers, and technicians work in these industries.

  • Media and Cultural Industries—Los Angeles is one of the world’s major entertainment centers and a nexus for film, fashion, publishing, television, and music. Its dominance of cultural industries attracts thousands of artists, writers, musicians, and technical experts.

  • Business and Professional Services—Representing the interconnected nature of California enterprise, professional services are important to marketing, selling, advising, and improving the state’s businesses. They are found statewide but are primarily located in large metropolitan areas such as Los Angeles, San Diego, and the Bay Area.

  • Hospitality and Tourism —From the Pacific Coast Highway to the state’s famous parks, restaurants and hotels, California is a draw for millions of people. In a state with such geographic diversity, nearly every region offers a different experience to travelers the world over.

  • Life Sciences—As new discoveries make life sciences a field of growing importance, California has been at the forefront of research, pharmaceutical production, healthcare, and biotechnology. More than 100,000 people are employed in pure life sciences production and research, with an additional 1 million working in healthcare.

  • Transportation Services, Heavy Manufacturing and Resource-based Manufacturing— These are key historic sectors that support the base of the state economy. Given their historical importance and the fact that more than 900,000 people are employed in production capacities, they are mentioned here. However, they are not an area of focus in this analysis because of the more limited number of jobs requiring degrees and because heavy manufacturing is no longer as significant an industrial driver as it once was in the United States.