November 14, 2017
By: Greg Matter, Managing Director, JLL
For a region much better known for its concentration of technology companies, there sure is a lot of manufacturing going on in the Bay Area. That’s one of the key findings of new report co-produced by JLL and the Bay Area Urban Manufacturing (BAUM) Initiative, a project of SFMade.
Fully ten percent of the region’s workforce is employed in the manufacturing sector and more than 7,500 manufacturing companies currently operate in the Bay Area.
Lifting all boats
Yet manufacturing also has an uplifting effect on other segments of the economy. Every one manufacturing job supports four jobs in other industries and every dollar spent in manufacturing adds $1.81 to the economy.
Manufacturing is also a pretty broad term. Bay Area manufacturers range from food and beverage firms to makers of medical devices and, yes, computers. There are also firms manufacturing apparel, aircraft, petroleum products, heavy equipment and hybrid as well as self-driving cars scattered throughout the nine counties.
The fourth industrial revolution, so-called Industry 4.0, is being driven by automation and data exchange, as well as the Industrial Internet of Things (IoT). It’s been called the “digitization of the manufacturing sector.”
Industry 4.0 with it’s connectivity, customization and technology advancements has meant that the future of manufacturing is centered around regionalization, which puts production facilities within close proximity to the consumer rather than in low cost, far flung locations,.
Fortunately, the Bay Area has a large, talented population to draw on for manufacturers. As a result, salaries in the sector can be quite high. Average hourly wages for experienced manufacturing workers range from around $26 to $30 per hour throughout the nine-county region. Annual salaries in manufacturing can reach as high as $150,000.
BAUM is a three-year initiative of 26 Bay Area cities to facilitate the creation of a well defined and interconnected regional manufacturing ecosystem. It was formed in 2016. A full report into Bay Area manufacturing issued by BAUM last year is available here.
I lead JLL’s Advanced Manufacturing Group. My expertise combines business consulting, workplace strategy with real estate negotiations. I enjoy working to optimize my client’s real estate portfolios while delivering on their strategic business objectives. My expertise includes real estate advisory and site selection, transaction management, workforce analysis, portfolio optimization, M&A advisory, taxes and economic incentives.
You can contact me directly via email at email@example.com or by phone at (650) 480-2220.
About advancements in manufacturing
In the video below, I discuss how advancements in automation and IoT provide two significant advantages in manufacturing: improved production in expensive markets (like the Bay Area) and quicker adaptation to market location. This was filmed during JLL Live at DisruptCRE in San Francisco on September 14, 2017.
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