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Novato's economic base is diversified and well integrated into the emerging new economy of the Bay Area. This new economy represents a fundamental shift towards small, knowledge-based businesses launched by entrepreneurs. These businesses also are typically oriented towards global, rather than local markets.
Knowledge-based industries are characteristically different from those associated with most of the world's economy. Knowledge-based economy characteristics include:
- Highly educated workforce
- High concentration of R&D facilities
- High numbers of patents per capita
- Technology-based products and exports
- High venture capital investment
These knowledge-based industries form the basis of the Bay Area's dominant and most competitive industries and industry clusters, including:
- Computers and electronics
- Telecommunications
- Multimedia
- Movie and television production
- Biosciences
- Banking and finance
- Environmental technology
Although detailed data at the city level are not available, anecdotal evidence suggests that Novato is home to several businesses belonging to at least some of these industry clusters. These include electronics, telecommunications, and biosciences.
Labor Force and Industry
Novato's labor force of nearly 25,000,4 like much of the Bay Area's population, is increasingly engaged in service-producing occupations and industries, including business, legal, engineering, and other services. Nearly one-third (more than 7,000) of Novato's employed residents are currently engaged in services (Figure 6), up from 24 percent ten years ago. Between 3,000 and 4,000 each are employed in three sectors: retail trade, manufacturing, and government. Less than 1,000 are currently employed in the construction industry. This number seems unlikely to grow significantly considering the continued slow pace of housing and non-residential construction in California and the Bay Area (Figure 7).
This increase in service employment share paradoxically may be increasing personal income in Novato and the North Bay. While most believe that the growth in service jobs is decreasing real income, the types of service jobs created in Novato and the Bay Area generally carry higher than average wages. For example, many of the business service jobs associated with the software, entertainment, engineering, and other professional services are high wage. In short, few, if not a minority of the service jobs generated in the new Bay Area economy probably are traditional low-wage, such as social, personal, and household services.
Unemployment by Business Sector
Novato and other suburbs are also home to a growing number of other companies, including some of Marin County's largest employers. Changes in the marketplace suggest that this trend towards the location of many small- to medium-sized companies-including home-based businesses-in the suburbs will continue. In particular, the prominence of knowledge-based firms suggests that many firms that once located in downtown areas now prefer suburban locations.
Marin's Largest Employers
| Company |
Headquarters |
Employees |
 |
| Fireman's Fund |
Novato |
2500 |
| Marin General Hospital |
Greenbrae |
1130 |
| Kaiser Permanente |
San Rafael |
995 |
| Autodesk |
San Rafael |
800 |
| Lucas Digital |
San Rafael |
775 |
| Safeway |
Pleasanton |
700 |
| Fair, Isaac and Co. |
San Rafael |
575 |
| Harris Corp. |
Novato |
400 |
| Broderbund |
Novato |
387 |
| GE Capital Assurance |
San Rafael |
340 |
| Marin Independent Journal |
Novato |
315 |
| Dominican College |
San Rafael |
299 |
| Pacific Gas and Electric |
San Rafael |
236 |
| Mindscape |
Novato |
200 |
| CCH Inc. |
San Rafael |
200 |
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Unemployment
Of the nearly 25,000 member civilian labor force in Novato in 1996, only a relatively small number were unemployed. In mid-to-late 1996, for example, about 1,000 were unemployed, translating into a roughly 4 percent unemployment rate, well below state and national averages. In fact, Novato traditionally has recorded unemployment rates that are consistently at least two points better than the state average.
Novato's unemployment rate is unlikely to reach the state or national averages for at least two reasons. First, Novato's workforce is highly skilled. Second, Novato's workforce is-on average-older than the state's or the nation's. As such, these older workers are less likely to face unemployment.
Unemployment rates in the U.S., California, the Bay Area, and Novato
Novato is located in far northern Marin County. Downtown Novato is 20 miles north of the Golden Gate Bridge, 27 miles from downtown San Francisco, and about 40 miles from Oakland. Novato is 26 miles from Santa Rosa, the largest city in Sonoma County.
Novato has a long list of attractive features for businesses and residents, including:
- A characteristic small town atmosphere
- Low population density with 3,500 acres of open space and parks
- An educated workforce
- High household income
- Lower housing prices than many Bay Area cities
- One of the largest retail centers in the North Bay
- Rapidly-growing software and professional services industries, with expanding international markets
- High investment in public schools and education
- One of the lowest crime rates in the Bay Area
Novato's rural atmosphere stems largely from its low population density and high amounts of open space and parks in and near the city. Novato's population density is about one-half that of San Rafael, and is nearly one-third that of Petaluma and Vallejo. Novato's sphere of influence includes nearly 3,500 acres of open space, and the city itself is home to a total of 27 parks, including three major city parks.
Novato's economic base is well integrated into the emerging new economy of the San Francisco Bay Area. This new economy represents a fundamental shift towards small, knowledge-based businesses launched by entrepreneurs. These businesses also are typically oriented towards global, rather than local markets. Businesses are supported by Novato's high-skilled, highly-educated labor force of nearly 25,000. These workers are increasingly engaged in professional service industries, including business, legal, engineering, and other services.
Housing in Novato is affordable. The median housing price in late 1996 was just over $250,000, well below the Marin County average and slightly below the average for the nine-county Bay Area. Novato's high personal income level and relatively low housing costs push median discretionary income for city residents to double the Bay Area average.
Novato is now home to Vintage Oaks, one of the leading retail centers in the North Bay. Novato is planning a major revitalization of its downtown areas, which should further augment local tax revenues and strengthen employment.
Novato's public schools are among the best in the Bay Area, demonstrated by higher-than-average student assessment scores and higher-than-average spending per pupil. Novato's per pupil spending is about 10 percent higher than the average in Sonoma and Solano counties.
Finally, Novato's crime rate is much lower than the Bay Area average. In 1995, 4.5 crimes were committed per 1,000 Novato residents, about one-half the rate in San Francisco and Vallejo.
In the near future, the development of The Buck Center for Research in Aging in northern Novato, Digital Village at the College of Marin's Novato campus, and the re-use of Hamilton Air Force Base will strengthen the economy further and provide opportunities for business expansion.
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