San Diego’s cybersecurity workforce has grown by nearly 15 percent over the past two years, according to a study released today by the Cyber Center of Excellence, a nonprofit industry group created to boost cybersecurity jobs and technologies in the region.
The center commissioned the report to help quantify the economic impact of the cybersecurity industry in San Diego, and to assess how employers view their prospects for growth and needs for future hiring. The center also asked the San Diego Regional Economic Development Corp. (EDC), which conducted the study, to analyze how cybersecurity has changed since 2014, when the first cybersecurity industry analysis led to the creation of the Cyber Center of Excellence.
According to the new report, San Diego now has more than 104 private cybersecurity firms that employ 4,230 people in the region, according to the analysis. That was up 19 percent from the 2014 study, which had 102 cybersecurity firms with 3,550 workers.
“Firms are still pretty dependent on government contracts for their business,” but the industry has moved over the past two years to more private sector customers, said Michael Combs, a CBRE research manager in San Diego and chief author of the study. Combs worked previously at the EDC and helped prepare the 2014 report.
Of the companies surveyed, 43 percent said they have a national customer base, and 37 percent have an international base. The customer base also has been evolving, with a bigger mix of government and commercial customers. For example, Combs said:
—About one-third of the companies surveyed in 2014 said the government was their primary customer. Only about 13 percent describe the government as their primary customer today.
—In 2014, 27 percent of the companies reported a mix of government and private customers. Today, 40 percent said they have a mix of government and private customers.
—The percentage of companies that focus exclusively on commercial markets also has increased, from 40 percent in 2014 to 47 percent today.
Many of the government contracts for cybersecurity are awarded by the Navy’s San Diego-based Space and Naval Warfare Systems Command (SPAWAR). The military procurement command is responsible for developing and maintaining the fleet’s global communications and IT capabilities. SPAWAR alone employs an additional 3,390 locals in cybersecurity, according to the study. That represents a 9.5 percent increase from the 3,095 workers counted in 2014.
Altogether, there are 7,620 military and private sector cybersecurity jobs in San Diego, a 14.7 percent increase from the 6,640 jobs counted in 2014.
The report describes SPAWAR as “the single most valuable resource to San Diego’s cyber ecosystem.” But as the region’s single biggest employer of cybersecurity experts, SPAWAR has challenges in terms of attracting qualified employees and in training local students through internships. “One issue area for SPAWAR is the regulatory structure that governs how they can recruit and retain talent,” the report says. “The sensitive nature of their work creates limitations on who and how they might be able to recruit from universities.”
Recruiting qualified professionals is a problem, but the report notes it is not unique to SanDiego, saying, “An analysis by the Peninsula Press and Burning Glass found that more than 209,000 cybersecurity jobs in the U.S. were unfilled as of March 2015.”
Using impact modeling software (Implan), the study found that the economic impact of San Diego’s cybersecurity cluster amounts to about $1.9 billion in direct and indirect impact on the local economy, as well as some “induced effects” such as increased wages. That’s about 26 percent more than the overall economic impact of $1.5 billion in 2014.
The growth seen over the past two years is not expected to continue at the same pace, Combs said. “We’re seeing continuing challenges in finding talent,” he said. “Eighty percent of the firms said they had some or great difficulty in finding talented employees.”
