New LA “Job Czar” Hired: Well, That’s One New Job Created

funny-pictures-beaver-wants-a-job-applicationIt’s not often I get to feel glad that I’m not a (reported) billionaire, but I’m glad I am not 49-year-old private equity investor and newly fledged Deputy Mayor Austin Beutner.

Beutner was last week appointed the mayor’s new deputy  and chief executive for economic and business policy. The media title is “Job Czar.”  He will also have, quoting the Times, “a new line of direct authority over the Department of Water and Power, the Port of Los Angeles and the economic and business policies at Los Angeles World Airports.”

Columnists at the Times and the Daily News acclaimed the appointment of Mr B, of whom almost no one had ever heard. Local unemployment stands at over 12 percent. It’s much higher in the neighborhoods where the major current career opportunities are with the Crips and Salvator Maratrucha. Clearly, jobs are a huge priority. Said the mayor, “Austin has a real vision for economic development and job creation.”

First and foremost, Beutner said he’d try to make LA  (the Times said) “a friendlier place for the sort of businesses that create well-paying jobs.”  Excuse me, but this is where I came in. For 30 years and four mayoral administrations, mayors and deputy mayors have promised exactly the same thing. As a result, tax structures have been gently shuffled, regulatory bureaucracies have received many a mild tweak and national campaigns have been launched to sell the world on LA’s commerce-friendly attractions.

No one has claimed these measures turned LA into a business paradise. But during this period, two utterly contradictory business developments did take place…

…First, Los Angeles became the biggest manufacturing city in the US.  Second, whole categories of exactly the kind of well-paid job everyone wants in LA took wing and fluttered away. Like aircraft design and production, automobile manufacturing, high-end retail (think department stores) and electronic equipment design and manufacture; even the financial sector shriveled as our major banks were sold out of state and our local stock exchange closed down. As a production center, Business LA seemed to be on bad steroids; it developed big muscles and shed its brains.

The big problem, of course, was that  the fastest-growing category of manufacturing jobs was bottom tier, non-union and minimum-wage-plus. These jobs are also the ones most likely to leave the country at a moment’s notice. And now, in 2010,  there aren’t even enough of them. But as the economy recovers, these are the jobs that will come back first. If  I were Beutner, I’d be looking at this sector as  the first line of the city’s employment recovery. But the unions that support the mayor would not, quite understandably, go for this strategy at all.

As for “well-paying jobs,” that gets tough. In order to attract high-end manufacturing and research and development to LA, you  need huge changes that do not fall under Beutner’s authority. Like, better public transportation and schools as well as more and cheaper housing. (Like Chicago has, which is why the Midwest giant is LA’s constant competitor for first place among the nation’s manufacturing cities. On the other hand, it doesn’t have 58-degree winters and a beach that never freezes.)
So far, the city’s own best bet for such jobs is its Green Tech development zone near the LA River. Unfortunately, the departure (forced or otherwise) of the tech zone’s City Hall sparkplug, Community Redevelopment Agency head Cecilia Estolano, isn’t going to help that project to create new jobs real soon.

Neither will Beutner’s  “new line of direct authority” to the city’s three proprietary departments. DWP is at least adequately staffed. With shrinking ship and air traffic, the Harbor and LAWA should be laying off, not hiring. There was something in the Times about Beutner trying to use “the city’s purchasing power to entice more vendors” to LA. But with a half-billion dollar deficit, LA has no business promising preferential – which could mean over-lowest-bidder– payments to any firm that moved to LA. Nor, for that matter, should it be buying anything in the quantities that would make it economical for, say, Oshkosh Trucks to open a plant in San Pedro.

But then I’m not the kind of guy who has ever had ideas sufficient to put me on Billionaire Row. Maybe Austin Beutner’s got some equally bright ideas on how to roll the city’s unemployment rate down below the national rate of just over 10 percent. He just hasn’t yet shared them with the rest of us.

4 Replies to “New LA “Job Czar” Hired: Well, That’s One New Job Created”

  1. Sounds like he has a tough row to hoe, and I’m left wondering about his credentials.

    You’re absolutely right that “The big problem, of course, was that the fastest-growing category of manufacturing jobs was bottom tier, non-union and minimum-wage-plus. These jobs are also the ones most likely to leave the country at a moment’s notice. And now, in 2010, there aren’t even enough of them. But as the economy recovers, these are the jobs that will come back first.” I think this is a reality that many people overlook because these same bottom-tier workers don’t have the voting clout at the polls, or the money, to influence elections.

  2. Being paid the token $1. is nice also it seems he has hit the ground running:
    “As for the port, Beutner said one of his first City Hall meetings was with representatives of a Chinese electric car company that’s thinking of manufacturing vehicles in L.A., among other places. If it happens, he said, the same green technology used to power cars could be put to other uses, like powering street lamps or enabling L.A. Unified schools to go solar. And all that would mean more jobs.”
    http://www.latimes.com/news/local/la-me-lopez27-2010jan27,0,1665884.column

  3. If his wife would go on a shopping spree and buy millions in clothing I could hire back the thirteen people I had to lay off in the last 8 months;-)

  4. I agree with 100% of what you say about failed efforts of the past and about how bad things are for Los Angeles. The two things I disagree with are the types of jobs we can attract. First, most of the low paying industrial jobs that left – are never coming back. Some will – but they are our past – not our future.

    Second, the Green Tech corridor not only will not create jobs – ever – for a variety of reasons (it costs too much to do that type of manufacturing in LA, most ‘green’ jobs will be created by making changes in existing factories & not by the ungreen process of building new factories, to name just two)- but it has already cost us hundreds of jobs.

    By banning all live-work spaces between Main Street and the LA River in most of Downtown – dozens of projects have had to be canceled; projects that would have taken now empty buildings and created far more – and higher paying creative and light industrial jobs – than the traditional factory jobs the city is trying to bring back to Los Angeles. Even Estolano in her last Downtown News interview seemed to admit the progam was a failure.

    Finally, while Austin Beutner may not have any city money to subsidize new factories, if he – and Bud Ovrum now that he’s at Building and Safety – can it easier to get permits and to do business in LA – he can accomplish miracles just by that. But, beyond that, it will be his ability to work with and attract creative businesses and financial businesses that will make the long term difference.

    Among other things, we need to work on the big three ‘F’s’. We need to recruit or create major financial businesses, we need to make LA a major fashion city such as New York and Paris are and we need to reinvigorate our film industry by understanding how film and tech and web and gaming are all now just variants of the same industry.

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