The Farmers Insurance Open, the annual PGA golf tournament at Torrey Pines that teed off Jan. 27, can be read as something as a metaphor for the San Diego economy.
Around this time a year ago, its organizational committee the Century Club of San Diego, was scrambling. The tournament’s title sponsor Buick had pulled out in the wake of General Motor’s (NYSE: GM) bankruptcy, and it wasn’t until nine days before the event began that Farmers Insurance stepped in.
This year, the tournament is going forward with much more stable backing, although not without some stress behind the scenes. Big name draw Tiger Woods didn’t confirm he was coming until about a week before the start of the event.
None of this is entirely dissimilar from the local economy, at least according to a man who has unique insight into both: Tom Wornham, the immediate past president of the Century Club and the executive vice president of Wells Fargo (NYSE: WFC) in San Diego.
“I think that everybody should be confidant it is stabilized and picking up,” Wornham said of the economy. “We can debate whether we’re in the 12th or 15th month of the recovery, but there is a recovery.”
Wornham acknowledged that to a lot of people, it doesn’t feel like a recovery is under way because unemployment numbers are still hovering uncomfortably close to 10 percent.
Wornham said that while the scale of the current recession is much worse, he felt that the recession of the mid-1990s after the collapse of the aerospace industry had a sharper effect on San Diego County. After that, the region became more diversified and has been able to weather economic storms.
He credited the presence of the military and major employers like Qualcomm (Nasdaq: QCOM) with preventing the full collapse other regions have experienced from happening in San Diego.
“We’re hitting on all cylinders as a region, in both private and public (sectors), which has really helped us,” he said.
San Diego’s economy is somewhat indicative of the economy at large, according to Garry Ridge. As the president and chief executive of WD-40 (Nasdaq: WDFC), Ridge has insight into both the local and global economies. WD-40 is based here, but sells all over the world.
In recent years, Ridge has been working hard to expand into emerging markets. “There’s lots of rust in Russia and squeaks in China, and we’re just the boys and girls to fix it,” he likes to say. His company recently had a very strong quarter and has added about 40 positions.
“Fortunately, we didn’t have to lay anyone off,” Ridge said of the last few years. “We actually employed people during the recession.”
However, he acknowledges that many of those jobs were abroad, in places like China. The United States just isn’t a growing market right now in that respect, and until it becomes one, the recession won’t feel over for the average worker.
Ridge said there are four basic kinds of markets: emerging, developing, developed and mature. Right now, it’s the first two that are seeing job growth, but that doesn’t mean the latter two, which include the United States, are being abandoned. Rather, companies like WD-40 are using developed and mature markets as testing grounds for newer products that companies hope will succeed and lead to more growth.
But the positive sign for the U.S. economy on the whole, Ridge said, is that like San Diego, it seems to have stabilized. There might not be a lot of growth, but the economy isn’t shrinking, either.
If it can continue to hold fast, there could be growth on the horizon.
“Our strategy is to see how do we leverage the trust that we’ve developed in the WD-40 brand by taking the brand into other products,” Ridge said.
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Jan. 13, 2015 -- George Chamberlin sits down with John Manley, chief equity strategist for Wells Fargo Funds Management, and James Kochan, chief fixed income strategist for Wells Fargo, to discuss how the stock market, interest rates and other financial matters fared in 2014.
July 30, 2014 -- George Chamberlin and Tom Wornham, chairman of the San Diego County Water Authority, discuss the drought and water restrictions.
June 17, 2013 -- George Chamberlin speaks with Steven Bernstein, senior vice president of the greater San Diego area for Wells Fargo Bank, about how the economy has improved and lending has picked up.