Curt Hagman: Invest now to keep logistics and goods movement sectors strong

Make no mistake: Southern California’s logistics industry is a critical economic driver, not just for the region, but for the state, the nation and the world.

Millions of jobs depend on it. In fact, more than one-third of all jobs in the six counties that comprise the Southern California Association of Governments (SCAG) region are connected — directly or indirectly — to the movement of goods.

It’s why SCAG, the nation’s largest metropolitan planning organization, should be applauded for taking the lead in advocating for greater investment in infrastructure, technology and systems to support this vital industry. While some are questioning whether we’ve gone too far, as a region, in expanding logistics and warehouse operations, the reality is that we are more reliant than ever on the trains, trucks, planes and fulfillment centers that enable the safe, efficient movement of goods through our region and across the nation.

When I say “we” I mean everyone — from the consumers who have made e-commerce a trillion-dollar business to the 2.3 million workers who are employed in goods movement-dependent industries to businesses, community organizations and local governments who benefit from the nearly $350 billion a year in economic contributions that logistics provides our region.

Break it down further, and the enormous economic impact of goods movement becomes even clearer. The South Bay Ports are among the largest container ports of entry in the world. Los Angeles International Airport and Ontario International Airport are two of busiest air freight hubs in North America. In the Inland Empire alone, the network of distribution and fulfillment centers directly employs 200,000 workers, while 40% of the nation’s consumer goods pass through the two-county region on any given day.

This creates some significant challenges, as well. Truck traffic across Southern California has grown to 1.2 million vehicles per day, and according to a new analysis by the American Transportation Research Institute, the region is home to three of the 10 worst freight bottlenecks in the country.

There’s also the potentially catastrophic economic consequence of a sustained decline in freight volumes at the Ports of Long Beach and Los Angeles. After 26 consecutive months of exceeding pre-pandemic levels, volumes at both ports began slumping during the second half of the year. One reason is the growing competition from East and Gulf Coast ports, which have invested heavily in their infrastructure and physical operation.

We need to do the same — invest in our infrastructure — not just at the ports, but across the region. We also need to continue investing in the technology and systems that will ensure a safer, more efficient and healthier movement of goods across our region.

There is no reason that Southern California can’t become the innovation hub for logistics.

In fact, no other region is better positioned to do so.

We can, and must, continue to develop new-and-improved methods for transporting goods in more efficient, environmentally sustainable ways.

As we do all of this, we will create even better career opportunities for the 37% of Southern California workers whose livelihoods depend on this industry.

SCAG has it right: Invest now, reap the benefits for generations to come.

Curt Hagman serves on the San Bernardino County Board of Supervisors and Second Vice President of the Southern California Association of Governments.