December 5, 2019

THE BLUE MODEL

California's economy will grow faster than the nation's, UCLA forecast predicts (MARGOT ROOSEVELT, DEC. 5, 2019, LA Times)

California's economic growth will slow next year, but it is likely to outshine that of the nation overall, as Golden State employers boost payrolls, according to a new UCLA Anderson School forecast. [...]

California's major population regions experienced job growth above 2% this year, except for Sacramento and Los Angeles. The U.S. outside of California experienced just 1.35% growth, the same as Los Angeles.

Nonetheless, the forecast noted, the high cost of housing and the Trump administration's immigration restrictions threaten to hamper growth in the Golden State. Many California businesses ranging from Silicon Valley tech firms to the Central Valley farms to Los Angeles' restaurants and hotels rely heavily on immigrant labor.

Growth rates vary in different parts of the job market, the forecast notes. High-value-added sectors, such as information, professional and business services, and construction, grew more slowly in recent months. Hiring in government, temporary and administrative services, private education and durable goods manufacturing grew more quickly.

Two bright spots: California's logistics industry, propelled by its giant Southern California ports, and its booming tech sector are likely to continue to grow faster than those industries in the rest of the nation.

In 2020 and 2021, the forecast predicts average unemployment rates of 4.3% and 4.6% respectively. In October, California joblessness stood at 3.9%, the lowest rate since 1976, when the state changed its statistical methodology, adding new data to its calculations.

The UCLA economists expect state payrolls to grow in 2020 and 2021 by 1.9% and 0.9% respectively.

At the same time, real personal income is forecast to grow by 2.1% and 1.9% in 2020 and 2021, reflecting a changing mix of employment in California and a tight labor market in high-wage occupations.

Posted by at December 5, 2019 4:00 AM

  

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