Our 26^th Annual Economic Luncheon welcomed over 160 guests to The City Club of San Francisco. Our expert panel included: Roxane Divol (Symantec Trust Services), Gary Schlossberg (Wells Fargo Capital Management) and Sean Randolph (Bay Area Council Economic Institute) and was moderated by Richard Waters (The Financial Times). The event provided attendees with an insight into the global and regional economy and what may be in store for 2016. Special thanks to our sponsors: Squire Patton Boggs, Mackenzie Communications, HSBC and 20/20 Productions.

Gary opened with a discussion of the wider global economy and then focused on China. He noted that Chinese economy in the midst of a “juggling act” involving a transition away from exports and investment to consumer lead growth, which almost by definition means a more moderate growth rate. Aside from China, the export-led recovery in Europe is beginning to end; and it is starting to rely upon domestic spending and is benefiting from the stimulus from the European Central Bank. Whilst it remains a fragile recovery, the European economy is growing slowly. This global environment does of course have a large impact on the US economy. The US has reverted to its traditional role as the “locomotive” for the global economy; but the US now has a smaller share of the global economy and the US growth rate is well short of what we were previously accustomed to.

Sean noted in 2015 the economy – both at a federal and state level- was reasonably sound despite volatility in commodity and equity markets. In Northern California, economic growth exceeded the national level and led California. The industries that led the way in 2015 were: IT, health services, tourism and business and professional services. Sean noted that these industries will continue to be the driving forces and may be joined by the emergence of digital health and medicine as new markets. He predicted that the Bay Area economy will continue to outperform the rest of California and the rest of the country by a good margin. One area to note is that the Bay Area will see a decline in venture investment from the very high levels of 2014 to the more normalized pace of 2013.

Roxane noted that the current economic climate was a “tale of haves and have nots”. The Bay Area is mostly a tale of haves, with e-commerce growth continuing to be very healthy. That said there are marked differences as not all “Bay Area innovation is created equal.” She predicted that there would indeed be a cooling in consumer driven technology whilst healthcare technologies and cyber security would experience growth. Roxane expects that 2016 will be a year of prudence for business, where companies reassess their business models and investors would show more caution going forward. This is partly due to the current economic climate but also the growing geopolitical conditions which have a bearing on Bay Area business.

With a lively panel discussion and many questions from the audience, the 2016 BABC Annual Economic Lunch provided an enlightening and stimulating discussion. The BABC would like to thank our sponsors Squire Patton Boggs, Mackenzie Communications, HSBC, and 20/20 Productions. Furthermore, thank you to our panelists: Gary Schlossberg, Roxane Divol and Sean Randolph and moderator Richard Waters for their time and expertise, and all attendees whose participation made the event a resounding success.

Check out the photos from the event!

Photography by Oliver Corrigan