It's long been taken for granted that California, and Sacramento in particular, can't be competitive in attracting manufacturing jobs, with its high costs and expensive regulations.
But since the passage of the federal CHIPS Act spurred a boom in investment in the American microchip industry, Sacramento has done pretty well in attracting its share of that money.
The Business Journal's Mark Anderson documented the trend in a cover story last month. The recent developments include German tech company Bosch's deal to acquire TSI Semiconductors and retool its Roseville factory to make in-demand chips for electric vehicles, and Solidigm's decision to relocate its headquarters from Silicon Valley to Rancho Cordova.
Over time, those moves alone may bring hundreds or thousands of new, high-paying technology jobs to the region and help diversify the local economy away from its dependence on state government.
And they could be just the beginning, as those companies spin out new businesses, and others follow to tap into our growing chipmaking workforce.
To be sure, California does have disadvantages to overcome. Costs are the reason that so much of the chip industry has been setting up overseas these past decades. And as venture capitalist Harry Laswell told us, "California presents all those issues on steroids."
It is unlikely that the special costs of doing business in California, like environmental regulation, will be coming down any time soon. So to keep the momentum going, it will be important for local leaders to do what they can to build our advantages.
The California Mobility Center, launched by SMUD in 2019, was intended to make Sacramento a center for development of new transportation technology. It's attracted startups and established industry players as members to facilitate collaboration, and offers services including a prototyping factory. Its growth could attract more tech companies like Bosch that are making products for the electric auto market.
But the Mobility Center appears to have been struggling of late. Its first CEO, Mark Rosekind, resigned six months into the job in April.
Expectations had been high for what Rosekind, a former high-level federal transportation official, would do for the Mobility Center.
But he ended up with limited resources after Sacramento County voters rejected Measure A last November. The measure would have authorized a sales tax that would benefit the Mobility Center, along with higher-profile transportation projects like the Sacramento Capital Southeast Connector Expressway.
Sacramento Congresswoman Doris Matsui is trying to bring more funding from the federal government to the Mobility Center. She's applying for it to be designated as a Regional Technology and Innovation Hub. There will be 20 such hubs around the nation, eligible for $500 million in funding between them under the CHIPS Act.
Greater Sacramento Economic Council CEO Barry Broome has suggested that that should be just the start for the California Mobility Center. He said that with a $150 million Mobility Center, the Sacramento region could be the leader in mobility technology that it was envisioned to be with the center's launch. That, he told us, will require local investment.
The Sacramento region has made some progress over the years in diversifying its economy and making it more dynamic. But it is still relatively slow, inequitable and prone to deeper downturns than other regions.
The recent additions to our tech economy are positive. Further investment in the Mobility Center could help continue the trend.
