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October 2005, Volume 11, Number 4

PPIC on San Joaquin Valley

California's Central Valley, which stretches 450 miles from Bakersfield in the south to Redding in the North, is one of the fastest-growing areas of California. The Valley's population, six million in 2000, is projected to more than double to 13 million by 2050, largely because of immigration and internal migration from coastal areas of California and other states.

Perhaps the most unusual point about this population growth is what is not driving it- the magnet of good jobs. Except for the Sacramento region, most Central Valley counties have double-digit unemployment rates and relatively low wages. Two PPIC monographs explore the Valley and the challenges and opportunities associated with growth.

Johnson and Hayes break the Central Valley into four sub-regions. The upper Sacramento Valley is a seven-county region with 650,000 residents and an economy based on agriculture and natural resources; the four-county Sacramento region has two million residents and an economy based on government and high-tech; the three-county northern San Joaquin Valley has 1.4 million residents in an agricultural region that also provides low-cost housing area for Bay-Area commuters; and the county-county southern San Joaquin Valley has 2.3 million residents is the state's agricultural heartland (most other classifications develop an eight-county San Joaquin Valley).

Each region's relative economic health is reflected in major migration flows. The Sacramento region attracts the most skilled in-migrants from other areas of California and abroad; the northern San Joaquin Valley attracts Bay Area workers seeking cheaper housing; and the northern Sacramento Valley gains about as many residents from other areas of California, often retirees, as it loses to other areas and states, often young people who complete college in the area. The southern San Joaquin Valley has been losing US-born residents to other states but growing as international migrants with little education arrive to begin their American journeys in fields and orchards.

The southern San Joaquin Valley stands out in the various tables and maps. If it were a state, it would be the largest "farm state" in the US, but it would also have the highest unemployment and poverty rates despite relatively rapid job growth over the past decade. The San Joaquin Valley is one of the few US regions in which inflation-adjusted per capita incomes fell from $21,100 in 1979 to $20,100 in 2001 (p19).

Why has job growth not reduced unemployment and poverty? A major reason is the type of economy and newcomer. A third of southern San Joaquin Valley adults did not complete high school, and only 15 percent have college degrees. In many of the farm worker towns that are home to new immigrants, over half of the children live in poverty, according to the 2000 census. Johnson and Hayes note that high poverty rates do not necessarily mean high welfare usage, since many of the poor are recently arrived immigrants not eligible for benefits.

Johnson and Hayes review the proposals for value-added agriculture to be an engine of economic development in the San Joaquin Valley. If this economic development strategy fails, and the San Joaquin Valley remains an area of poverty in a land of agricultural plenty, the result may be a rural underclass. Many of the newcomers are from rural Mexico, where that country's revolution failed to end rural poverty. As Johnson and Hayes note, avoiding the same fate in the San Joaquin Valley "depends on the economic success of its immigrants but perhaps even more on that of their children." (p64).

Teitz and his colleagues focus on the future of the San Joaquin Valley, defined to include eight counties and 62 cities spread over 27,000 square miles- combining the northern and southern San Joaquin Valley of Johnson and Hayes. The Teitz-defined San Joaquin Valley population doubled between 1970 and 2000 to 3.3 million, and is projected to double again to 7 million by 2040, about the population of the greater Bay Area today. The San Joaquin Valley labor force of 1.5 million in 2003 had an unemployment rate of 12.3 percent, or 2.5 times the California rate of 4.9 percent.

The San Joaquin Valley changed most radically after 1870, when the transcontinental railroad and irrigation encouraged a shift away from dryland wheat and cattle farming to higher value crops such as fruits that could be dried or sent in refrigerated rail cars to the eastern US. Unlike the rest of the US, where small farms were consolidated into larger units, the San Joaquin Valley began with large farms that were not broken up because waves of newcomers with no other US job options were available to be seasonal workers. Today, there are 3.2 million acres of prime farm land in the San Joaquin Valley, which produces half of the state's $28 billion in farm sales and hires half of the million individuals employed for wages on the state's farms sometime during a typical year. Average employment in California agriculture is about 400,000, so each year-round equivalent job is shared by about 2.5 workers.

Teitz and his colleagues look ahead, laying out four models of future San Joaquin Valley development: status quo, farm land conservation, high-speed rail, and auto-oriented growth with new highways. Under each of these scenarios except conservation, the amount of prime farm land would shrink by 15 to 30 percent to provide housing for additional people. However, shrinking farm land does not mean that the value of farm sales or the employment of farm workers will decline, since farmers tend to shift from lower to higher value crops as land and water get more expensive, as when they change from hay to nursery crops.

Opinion polls find that San Joaquin Valley residents rank the lack of good jobs, air pollution, and loss of farm land as their major concerns. However, achieving consensus on the future in a valley that wants to preserve its agricultural heritage while creating good nonfarm jobs that can lift immigrants and their children out of poverty will not be easy. Teitz and his colleagues conclude that the future will likely be some variation of the status quo: "an automobile-oriented, low-rise development at lower-than-current densities" (p64), with the caveat that "public policy could play a role in shaping the Valley's urban form." (p65).

Johnson, Hans P. and Joseph M. Hayes. 2004. The Central Valley at a Crossroads: Migration and Its Implications. Public Policy Institute of California. November. Teitz, Michael B, Charles Dietzel, and William Fulton. 2005. Urban Development Futures in the San Joaquin Valley. Public Policy Institute of California. February.