Los Angeles, apex trade gateway to the US

Goods moving to rest of country make for a multitude of workers

The US shortage of labour, products and services due to Covid-19’s disruption of the global economy has a platinum lining in Los Angeles. Obscured by unprecedented supply-chain bottlenecks, California’s largest city, second only to New York in the US, has no peer in the unloading, processing and transporting of the country’s imports from its two busiest ports.

Being the supreme gateway for US trade helps make the Southern California area of about 1,600km² (Los Angeles, Long Beach and Anaheim) the fastest-growing labour market among the five largest US metropolises in the past year and perennially number one for factory workers, according to data compiled by Bloomberg.

The almost 65 container ships at anchor waiting to discharge cargoes also masks their direct and indirect benefits to corporate Los Angeles, including a variety of financial firms chasing business from China to South Korea.

The region’s 474 publicly traded companies were national laggards until 2020, when they rebounded to become the best performers in the stock market among their peers in the top five cities. At the same time, home prices provided the greatest risk-adjusted return appreciation with the lowest volatility despite the shakeout caused by the pandemic.

“There is an undeniable effect on the success of the ports and the success of the economy,” said Gene Seroka, executive director of the Port of Los Angeles, which has had 49% growth since 2020, the biggest rise in nine years. Long Beach shipping expanding 29% at the same time means the two ports accounted for 37% of the US market since Covid-19 struck, more than double the share of the Port of New York and New Jersey, the closest competitor.

“We have the largest manufacturing employment base, about 390,000 individuals, based in Los Angeles County,” Seroka said at his San Pedro office.

“One in nine jobs in Southern California’s five-county region emanate from this port. Whether you’re an administrator like myself, a dock worker, a truck driver or a logistician, a warehouse manager and everything in between, there are about 1-million pay cheques that come out every week dedicated on business done here at this port complex.”

Los Angeles mayor Eric Garcetti, former Navy Reserve lieutenant, Rhodes scholar and jazz pianist now in his second term’s fourth year, follows shipping the way he reads music. “Here, one out of nine jobs in the region, one out of 50 in the country, it’s 2%, can be linked to the port,” he said in September. “One of the most exciting things that I always do is I’ll sit down with a member of congress from Maine, Florida or Alaska and let them know how many jobs come through the Port of LA that they depend on.”

Public-private partnerships champion Garcetti raised $50m in two weeks for the 2028 Olympics in the city, and he was more than a decade ahead of Green New Deal Democrats when he authored Los Angeles’ clean water bond and municipal green-building ordinances.

Improved infrastructure may be his biggest legacy, with the record $14bn spent to increase annual passenger airline traffic to more than 100-million, from 87.5-million in 2018. The $4.9bn contract for Los Angeles International Airport, one of the few in the US with nonstop daily flights to six continents, is the city’s largest. The private sector maintains the airport.

When President Joe Biden said in October that the Port of Los Angeles will follow Long Beach by operating 24 hours a day to relieve the backlog slowing goods delivery to the US, he affirmed the essential role of Los Angeles in the US economy. Seroka said: “The cargo that traverses this port reaches each and every one of our nation’s 435 congressional districts.” Carcetti said: “The port is a national treasure. Investing in the Port of Los Angeles is investing in the USA.”

Employment in greater Los Angeles rose 18.6% since the end of May 2020, almost double California’s 9.9% increase and exceeding New York’s 15.2%, Chicago’s 12%, Houston’s 11.1%, Philadelphia’s 16.2%, Phoenix’s 7.1%, San Antonio’s 14.5%, San Diego’s 12.5%, Dallas’ 14.6% and San Jose’s 9.3%.

Austin, which captivated headline writers as the destination of choice for such California CEOs as Tesla’s Elon Musk, remains an also-ran at 16.4%, according to data compiled by Bloomberg.

The 22 major publicly traded companies based in Los Angeles with at least a $1bn market capitalisation returned 33% this year through September 20 and 59% for the 12 months ended on that date, handily beating their peers in New York, 27% and 56%, respectively; Chicago, 16% and 33%; and Houston, 28% and 54%, according to data compiled by Bloomberg. The winners include B Riley Financial, up 168% the past 12 months; Korn Ferry, up 142%; and Preferred Bank, up 107%, according to data compiled by Bloomberg.

“It often surprises people that Los Angeles county is the largest manufacturing county in the country in terms of value,” said Tom O’Brien, executive director for international trade and transportation at California State University Long Beach.

“We have a manufacturing foundation that supports that relationship between the ports and the rest of the trade sector, and there’s a lot of technology companies that are not specific client to the base, trade whether sector but’that it s the rely on the trade sector for a large combination of cybersecurity, or whether it s load-matching technology.

What sets Los Angeles apart is that “it is the fastest route from North Asia to the interior of the country to our population of any port or gateway in the US,” said Seroka. That means “getting on a ship in Shanghai and running 13 days to LA, getting on a train that’s no less than three miles in length, running to Chicago, 100 times per day, is the best way to go”.

Garcetti, who may soon be shipping off to India as the next US ambassador, said he realised after he was elected mayor in 2013 that the hand-wringing over companies giving up their Los Angeles headquarters was not necessarily a sign of weakness.

“I realised one daily transoceanic flight was worth more than a Fortune 500 company,” he said.

“We had them twice a day before the pandemic. LA always has been a start-up business type of place, and LA is the third-largest metro economy in the world now. It will be the most important city to be in.”

ACROSS

7. Solo rendered by egghead is lacking in control (5)

8. Watch prospect (4-3)

9. Admirable feature in the field? (4,3)

10. Requirements of necessity (5)

12. Temporary fashion to show every bit of violent anger (3,3,4)

15. Apparently having fun quite early (2,4,4)

18. A fitting comparison to hand? (5)

19. Not an egg-layer, but a crow producer (7)

21. Roars to make the fire roar? (7)

22. Ring for a sandwich (5)

DOWN

1. Animosity resulting from malaise, perhaps (3-7)

2. Injury closely wrapped (5)

3. Inventor one could ring? (4)

4. Trivial insult (6)

5. Ray of light with doctor on right track (8)

6. He is in charge right among the enemy (7)

11. Giles hired for Santa’s journey (6-4)

13. Stray carton to put a horse in? (5-3)

14. Glib one becomes despicable (7)

16. Songster halves that hurryscurry (6)

17. Clearly not a drink for slimmers (5)

20. Go back again to evil giant (4)

PREVIOUS SOLUTION Across: 1 Disgusted; 8 Ole; 9 Sailing boat; 11 Bayonet; 12 Erect; 13 Abused; 15 Temple; 17 Holst; 18 Canvass; 20 Air Minister; 22 Ass; 23 Lip-reader. Down: 2 Ida; 3 Union; 4 Tights; 5 Diocese; 6 Potted plant; 7 Temptress; 10 If you please; 11 Beachwear; 14 Enthral; 16 Scrimp; 19 Naive; 21 Eve.