California Biomedical Industry - California Healthcare Institute

Among the companies that expandedtheir in-state operations, the largestpercentage credited the skilledworkforce for that decision (Figure12). High marks also were given forthe culture of entrepreneurship orinnovation in California. Many also arestaying and growing here because this iswhere their companies were founded.Among companies that cut operationsin California over the past year, 20percent cited “cost-cutting initiatives” astheir motive (Figure 13). The other topcited reasons were business decline andlack or loss of private funding — both at16 percent.Over the past year, the surveyrespondents reported much moreanemic growth in their out-of-state andforeign operations, although growthdid exceed reductions in all categoriesexcept G&A staffing.Looking ahead 24 months, respondentsanticipate solid growth for theirCalifornia operations (Figure 15) andslow or flat growth for their out-of-Figure 11: 2011 CEO Survey: Have the following activities expanded, held steadyor reduced for the company’s operations inside California in the past year?Held steadyReducedExpandedResearchanddevelopment35%22%43%Manufacturing58%13%29%General andadministrative53%24%24%Overallworkforce34%26%40%Figure 12: 2011 CEO Survey: Which of the following are the factors influencingyour decision to locate or expand your operations inside California?Skilled workforce 36%History of founders/California is where the company was founded 31%Culture of entrepreneurship or innovation 31%Access to leading research universities 28%Quality of life 26%Access to pharmaceutical, biotech, device and diagnostics companies 23%Access to funding or capital 21%Pro-business environment or commitment to the industry 9%Tax incentives 8%Cost of doing business 7%Alliance with other leading California industries 6%Other 4%Cost of living 4%State commitment to education funding 1%Figure 13: 2011 CEO Survey: Select the reasons why the company’s operationshave reduced inside California in the past year.Cost cutting initiative 20%Business slowdown or decline 16%Lack or loss of private funding 16%Overall business climate/cost of doing business 13%Expanded new operations outside of California 8%Lack of tax incentives or unfavorable tax environment 6%Cost of living 6%Other 6%Moved existing operations outside of California 4%Qualified workforce elsewhere 4%Sold or consolidated a portion of the business 3%Other regions offering free or less expensive land/infrastructure for expansion 3%Attractive state funding, grants, or investments elsewhere 1%12 | California Biomedical Industry 2011 Report