Thread: Southern California economy is beginning to gain strength

Southern California economy is beginning to gain strength, forecast says

Tourism is gaining, the entertainment industry is thriving and trade projections have jumped, a report from the L.A. County Economic Development Corp. says. But areas of weakness persist.

By Ronald D. White, Los Angeles Times
July 21, 2010 | 12:01 a.m.

Southern California's economy is beginning to gain strength, although local residents may not feel the benefits for many months, according to a forecast to be released Wednesday.

Regional employers will be slow to rehire. The housing and construction industries are struggling, and tight credit is crimping consumer and business spending.

But tourism is gaining, the entertainment industry is thriving, and international trade projections have jumped since February, the report from the Kyser Center for Economic Research at the Los Angeles County Economic Development Corp. says.

Nationally, as in the Southland, the recession did so much harm that the recovery has some distance to travel before the damage is repaired, the report says. But unlike some more pessimistic prognosticators who fear the U.S. could slip back into recession, the report's authors believe the recovery "will proceed upwards and not relapse, though activity may grow in fits and starts."

"It's real. That doesn't mean it's going to be steady, but it probably won't reverse," said Nancy Sidhu, chief economist for the Economic Development Corp.

Her colleague, consulting economist Jack Kyser, put it another way: "The patient was extremely sick and in intensive care, but he's stabilized and in a very slow and challenging recovery."

In Southern California, the three strongest parts of the recovery will come in tourism and travel; motion picture and television production; and international trade. They received the only B grades among 11 employment sectors that included commercial and military-related aerospace; healthcare services; and apparel design and manufacturing.

Even in those strongest sectors, however, job growth is expected to be mostly flat compared with 2009 or still on the decline in 2010, with modest gains coming in 2011. Nonfarm employment in the five Southern California counties, for example, will fall from 6.6 million last year to 6.5 million in 2010, or a 1.2% decline, before rising to 6.6 million again in 2011, the report said.

The Labor Department said Tuesday that California in June continued to post the nation's third-highest unemployment rate at 12.3%, behind Nevada's 14.2% jobless rate and Michigan's 13.2%. Employers cut overall jobs in 27 states in June, with California and New York recording the biggest decreases, the government said.

International trade activity is now expected to rise 14% in Southern California this year, having been revised upward twice by economists from just 5% growth in February. But this sector, which employs about 400,000 in the five Southern California counties, isn't expected to see overall job gains until 2011.

Technology employment, centered mainly in Los Angeles and Orange counties, is expected to show a similarly weak pattern. After employing 223,800 workers in 2008, that sector fell to fewer than 207,000 in 2009 and will fall by an additional 1,200 jobs in 2011.

Tourism-related businesses aren't expected to add jobs until 2011, and then only modestly. Employment in that sector will rise from about 87,400 jobs in Los Angeles, Orange, Riverside, San Bernardino and Ventura counties this year to 89,100.

Part of the reason for the tepid jobs outlook is employer caution.

"The first people they will hire are the former employees that they let go during the recession," Sidhu said. "The next group will be temporary employees. That will continue until businesses begin to believe what we are telling them, that this recovery is real."

Another reason is that the credit crunch continues to have a daunting effect on both consumers and businesses.

"A growing economy needs plenty of borrowing capability," Sidhu said. "If you want to buy a new home, you need a mortgage. If a business wants to expand their factory, they need to be able to borrow to do it. If the economy is really going to get going, we need to be done with the credit crunch."

Don't expect any improvement in manufacturing or the housing sector, where it is unclear where the bottom of the market might be, researchers said. Also of concern were the constraints of the seriously unbalanced state budget, which was expected to limit the amount of spending local governments could do.

But there were some strong signs for the future. Some businesses, Sidhu said, were buying computer equipment.

"This is new since February. We are seeing purchases of high-tech equipment. Not just new personal computers, but some of the more sophisticated servers. Some businesses are working very hard to develop their Internet sites and online capabilities," Sidhu said.

Kyser said California had scored some recent successes in attracting new business and employment opportunities.

"We're seeing some business move here," he said. " Dendreon is a biotech firm out of Seattle putting a facility in Orange County. You have several retailers looking to get into the Southern California market and taking advantage of the glut of vacant retail space.

"Some of the major banks are expanding their presence in this market, like Chase and U.S. Bancorp.," Kyser added. "People sense that there is still opportunity in Southern California."

ron.white@latimes.com

http://www.latimes.com/business/la-fi-f ... 8265.story

Originally Posted by JohnDoe2

[size=18]"We're seeing some business move here," he said. " Dendreon is a biotech firm out of Seattle putting a facility in Orange County. You have several retailers looking to get into the Southern California market and taking advantage of the glut of vacant retail space.
http://www.latimes.com/business/la-fi-f ... 8265.story

=========================================

Let's see ... rampant gangs moving unimpeded throughout the state, millions of illegal aliens locked into perpetual government benefits, L.A. has the worst education system and SAT scores in the country, tortuous property, state, and local taxes, water and power rationing, among the most congested cities in the world, runaway crime rate, laying off law enforcement and cutting public services, bankrupt ...

Yep. A great place to move to (and get murdered in).

What a snow job from the L.A. Times.

Southern California's economy is beginning to gain strength, although local residents may not feel the benefits for many months,

Many months meaning after the November elections. I wonder if this guy was in the journalist pool that propagandized the news for the Social Democrats.

Originally Posted by HAPPY2BME

Let's see ... rampant gangs moving unimpeded throughout the state, millions of illegal aliens locked into perpetual government benefits, L.A. has the worst education system and SAT scores in the country, tortuous property, state, and local taxes, water and power rationing, among the most congested cities in the world, runaway crime rate, laying off law enforcement and cutting public services, bankrupt ...

Yep. A great place to move to (and get murdered in).

Forbes.com
Full List: America's Safest Cities
Zack O'Malley Greenburg, 10.26.09, 04:00 PM EDT

These metros have the lowest rates of violent crime, workplace deaths, fatal crashes and natural disasters.

Rank Metro Area MSA Population Violent Crime Workplace Fatality Rates Traffic Death Rates Natural Disaster Risk Total
1 Minneapolis-St. Paul-Bloomington, MN-WI 3,229,878 9 1 7 7 24
2 Milwaukee-Waukesha-West Allis, WI 1,549,308 24 11 4 1 40
3 Portland-Vancouver-Beaverton, OR-WA 2,207,462 1 10 5 25 41
4 Boston-Cambridge-Quincy, MA-NH 4,522,858 10 5 1 28 44
4 Seattle-Tacoma-Bellevue, WA 3,344,813 3 2 8 31 44
6 Providence-New Bedford-Fall River, RI-MA 1,596,611 6 7 11 28 52
7 San Jose-Sunnyvale-Santa Clara, CA 1,819,198 2 8 6 38 54
8 New York-Northern New Jersey-Long Island, NY-NJ-PA 19,006,798 11 15 2 27 55
9 Cincinnati-Middletown, OH-KY-IN 2,155,137 8 27 20 2 57
10 Cleveland-Elyria-Mentor, OH 2,088,291 15 25 17 2 59
10 Denver-Aurora, CO 2,506,626 5 28 16 10 59
12 Detroit-Warren-Livonia, MI 4,425,110 40 4 10 8 62
13 San Diego-Carlsbad-San Marcos, CA 3,001,072 14 6 19 26 65
14 Phoenix-Mesa-Scottsdale, AZ 4,281,899 17 17 27 5 66
15 Chicago-Naperville-Joliet, IL-IN-WI 9,569,624 26 23 9 9 67
15 Austin-Round Rock, TX 1,652,602 4 14 34 15 67
15 Dallas-Fort Worth-Arlington, TX 6,300,006 19 12 18 18 67
18 Pittsburgh, PA 2,351,192 7 37 24 2 70
19 Los Angeles-Long Beach-Santa Ana, CA 12,872,808 21 3 12 35 71
20 Washington-Arlington-Alexandria, DC-VA-MD-WV 5,358,130 16 24 13 20 73
21 Philadelphia-Camden-Wilmington, PA-NJ-DE-MD 5,838,471 28 30 14 6 78
22 San Antonio, TX 2,031,445 25 16 30 12 83
23 Atlanta-Sandy Springs-Marietta, GA 5,376,285 20 20 32 14 86
24 Sacramento-Arden-Arcade-Roseville, CA 2,109,832 22 18 15 33 88
25 San Francisco-Oakland-Fremont, CA 4,274,531 29 22 3 39 93
26 Baltimore-Towson, MD 2,667,117 34 21 21 21 97
27 Virginia Beach-Norfolk-Newport News, VA-NC 1,658,292 13 31 22 32 98
28 Tampa-St. Petersburg-Clearwater, FL 2,733,761 32 9 38 22 101
29 Las Vegas-Paradise, NV 1,865,746 39 26 29 11 105
29 Columbus, OH 1,773,120 12 36 23 34 105
31 Charlotte-Gastonia-Concord, NC-SC 1,701,799 31 29 25 22 107
32 Kansas City, MO-KS 2,002,047 27 32 33 16 108
32 Riverside-San Bernardino-Ontario, CA 4,115,871 18 19 36 35 108
34 St. Louis, MO-IL 2,816,710 23 39 31 16 109
35 Orlando-Kissimmee, FL 2,054,574 38 13 40 22 113
36 Indianapolis-Carmel, IN 1,715,459 30 40 26 19 115
37 Nashville-Davidson-Murfreesboro-Franklin, TN 1,550,733 36 33 37 13 119
38 Houston-Sugar Land-Baytown, TX 5,728,143 33 38 28 37 136
39 Jacksonville, FL 1,313,228 37 35 39 30 141
40 Miami-Fort Lauderdale-Pompano Beach, FL 5,414,772 35 34 35 40 144

http://www.forbes.com/2009/10/26/safest ... chart.html

http://www.alipac.us/ftopict-206455-.html

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