Southern California economic recovery is forecast

News Admin  February 25 2010 10:56:05 AM

Modest growth is likely this year and next, but unemployment will remain high, according to the report from the Kyser Center for Economic Research.
February 17, 2010|By Tiffany Hsu

Southern California is headed for a gradual economic recovery in 2010 and 2011, along with the rest of the state and the country, according to a forecast released today.

Unemployment will remain elevated, but the entertainment, international trade and tourism sectors will push growth regionally, according to the report from the Kyser Center for Economic Research at the Los Angeles County Economic Development Corp.

"The feeling is that the worst is past and we are looking at a modest recovery," said Jack Kyser, founding economist of the center. "But there's still fear out there. We've got a ways to go to get back to our peak."

Although the economy is improving, there won't be much short-term relief for California's unemployed. The state has lost more than half a million jobs since 2008 and isn't likely to see employment growth until 2011. The state's unemployment rate, which hit 12.4% in December, is projected to stay there, averaging 12.4% for 2010 and falling only slightly to an average of 12% next year.

Tight credit and uncertainty over federal healthcare reform and the staying power of the budding recovery have made employers reluctant to hire, Kyser said. As business picks up, he said, many are coping by giving their employees more hours or by hiring temporary staff instead of full-time workers.

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