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San Diego North EDC: AI investment reshaping capital flows; Carlsbad faces housing shortfall that squeezes small businesses
Summary
Eric Breovold of the San Diego North EDC told the subcommittee that venture capital flows into AI are drawing funding away from biotechnology and that Carlsbad’s jobs-to-housing ratio rose from 1.58 to 1.68 between 2013 and 2023, leaving a shortfall of roughly 3,000 homes versus a 6,000-home target to maintain supply balance.
Eric Breovold, president and CEO of the San Diego North Economic Development Council, told the Carlsbad Economic Development Subcommittee the region faces a set of interacting challenges: slower job growth in key clusters, concentrated venture capital into AI, increasing competitive pressure on small businesses and a structural jobs-to-housing imbalance in Carlsbad.
Breovold summarized four headline findings: slowing job growth in key sectors; AI’s dominance of capital flows and the related contraction of venture investment in biotechnology; an especially competitive environment for small firms driven by higher labor and input costs; and a rising jobs-to-housing ratio that makes local housing less affordable for workers. "If 2013, we really okay… we added 3.03 jobs for every net 1 home," he said, noting that Carlsbad added roughly half the housing needed to maintain earlier ratios and was about 3,000 homes short of a 6,000-home benchmark.
Why it matters: Breovold said the imbalance affects household formation, worker commutes and small-business demand because households must spend a larger share of paychecks on housing. He argued that without more housing production or targeted policies to address supply, the local economy will remain constrained.
Region and city responses: Breovold and staff described proactive industry-led retention efforts, sponsorship of Startup Week to attract entrepreneurs, digital marketing targeted to high-probability relocation regions and business expansion-and-retention efforts. He also announced Project NEXT, a first-job hiring event on April 29 intended to connect inexperienced jobseekers with employers; the event had ~350 jobseekers and 16 employers last year and organizers hope to expand participation.
Council questions focused on data granularity and attraction strategy. Breovold said commonly available local datasets do not reliably segment employment growth by firm size at the subcounty level; he recommended regional capacity-building for direct outreach to target companies and site selectors.
What’s next: The subcommittee received the report; staff and regional partners will continue business-retention programming, marketing and workforce events such as Project NEXT that aim to narrow hiring gaps while longer-term housing solutions are pursued.
