San Bernardino Metro Leads in Financing Ecosystems and Business Dynamism
A region’s attractiveness as a place to do business is critical in our interconnected national economy, where entrepreneurs and businesses have choices about where to locate. The availability of business supports, opportunities for growth, and barriers to doing business are all factors influencing these choices. Since businesses provide jobs, sales tax revenue, economic growth, and entrepreneurship opportunities, a strong business climate and growing job base is important for maintaining San Bernardino County’s economic health and quality of life. This indicator uses two indices as proxies for assessing the county’s business climate: the Milken Institute’s “Best Performing Cities,” which is based on job creation, wage growth, and output growth; and selected indicators from the American Dream Prosperity Index, including financing ecosystems, dynamism, and labor force engagement.
BASELINE
Best Performing Cities
The Riverside-San Bernardino metro area ranks among the top 100 best performing cities in the nation out of 200 metros assessed. The region’s overall performance rank in 2022 was 22, up from 36 in 2021. Among specific components of the index, Riverside-San Bernardino ranked 12th in five-year job growth (2015-2020), and 21st in 5-year wage growth (2015-2020). The region’s 12-month job growth from November 2020-November 2021 ranked 60th.
Within high-tech indicators, the metro region’s five-year High-Tech GDP was ranked 57th among all large regions included in the index, and the region ranked 133rd in High-Tech Concentration.[1]
Riverside-San Bernardino’s Overall Business Performance Ranks 22nd Among Large U.S. Metro Areas
Riverside-San Bernardino Metro Area Business Performance Rankings, 2022
Source: Milken Institute, Best Performing Cities 2022 (https://milkeninstitute.org/report/best-performing-cities-2022)
American Dream Prosperity Index
In this index, counties are ranked by decile, from the best performing (1st decile) to the worst performing (10th decile). San Bernardino County is in the 1st decile of U.S. counties based on its financing ecosystems, which include bank branch access, venture capital invested, number of venture capital deals, assets under management, venture capital fundraising, and new foreign direct investment. San Bernardino County scored in the 2nd decile of U.S. counties based on its business dynamism, which includes rate of new employers, startup early job creation, startup early survival rate, opportunity-driven startups, rate of new entrepreneurs, and patent applications.[2] Among these dynamism components, San Bernardino County is in the first decile of all counties for startup early survival rate and in the seventh decile of all counties with regard to opportunity-driven startups.
Among workforce indicators, San Bernardino scored in the 7th decile for adult skills, which includes the share of the adult population with at least a high school diploma and the share of the adult population with a bachelor’s degree or higher, and in the 9th decile for labor force engagement, which includes unemployment, youth unemployment, employee engagement, statewide underemployment, and labor force participation.
Financing and Dynamism Excel; Adult Skills and Labor Force Engagement Lag
San Bernardino County’s Decile Ranking in Key Business Climate Elements Measured in the American Dream Prosperity Index, 2022
Source: Legatum Institute, American Dream Prosperity Index, 2022
GEOGRAPHIC COMPARISON
Best Performing Cities
At 22nd in the nation, Riverside-San Bernardino ranked behind the Phoenix Metro area (4th), but above the other selected peer markets based on business performance.
Riverside-San Bernardino Metro Performance Outranks Most Peer Regions
Overall Business Performance Ranking Among Riverside-San Bernardino and Peer Markets, 2022
Source: Milken Institute, Best Performing Cities 2022 (https://milkeninstitute.org/report/best-performing-cities-2022)
American Dream Prosperity Index
Similar to peer counties, San Bernardino County is in the 1st decile of all counties included in the American Dream Prosperity Index based on its financing ecosystems. San Bernardino County scored in the 2nd decile of U.S. counties based on its business dynamism, slightly lagging peer counites.
San Bernardino County scored in the 9th decile for labor force engagement, similar to Los Angeles County, but lagged other peer regions. Similarly, San Bernardino County lags peer counties for adult skills. The county has scored lower than the state or U.S. counties as whole for the past 10 years.
San Bernardino Lags Peer Counites in Labor Force Engagement and Adult Skills
Decile Ranking of Peer Counties in Key Business Climate Elements Measured in the American Dream Prosperity Index, 2022
| Key Business Climate Elements | San Bernardino County | Los Angeles County | Miami-Dade County | Orange County | San Diego County |
|---|---|---|---|---|---|
| Financing ecosystems | 1 | 1 | 1 | 1 | 1 |
| Dynamism | 2 | 1 | 1 | 1 | 1 |
| Labor force engagement | 9 | 9 | 5 | 7 | 8 |
| Adult skills | 7 | 5 | 5 | 2 | 2 |
Note: Maricopa County (Phoenix) and Clark County (Las Vegas) are not included in the American Dream Prosperity Index.
Source: Legatum Institute American Dream Prosperity Index, 2022
[1] High-tech GDP is a county-level equivalent of Gross Domestic Product that only includes high-tech industries. High-tech concentration measures the number of discrete tech sectors in each metro area that have higher employment concentration than the national average.
[2] Startup early job creation is the average number of jobs created by startups in their first year. Startup early survival rate is the percent of startups that are still active after one year. Opportunity-driven startups is the percent of new entrepreneurs who created a business by choice instead of necessity. Rate of new entrepreneurs is the percent of the population that starts a new business.