The Business Forecasting Center's April 2010 California and Metro Forecast has been released.
Below are some highlights from the California forecast. You can see more about the 10 metro areas we track (or become a subscriber!) by clicking here.
Highlights of the April 2010 Forecast
California’s recession ended in late 2009. The state is in the early stages of a slow five year recovery back to more normal economic conditions.
California unemployment is currently peaking at 12.6%, and will remain above 12% through the end of 2010, and above 10% through all of 2011.
Payroll jobs bottomed out this winter nearly 1.4 million jobs below their 15.2 million job peak in Summer 2007.
It will take more than 4 years for jobs to recover the 9% decline. During the seven years of zero net job growth from 2007 to 2014, the state’s population will have grown by 2.5 million people keeping unemployment above 8% through most of 2014.
Growth in real gross state product will average a modest 3% over the next four years.
Construction has lost 400,000 jobs, by far the worst sector through the recession. This cyclical sector will eventually bounce back, and should experience more than 10% job growth in 2012 and 2013.
With the notable exception of the NUMMI closure, manufacturing is leading the early stages of the recovery. Next year could bring the first annual increase in California manufacturing employment in a decade.
Construction continues to lead job losses in percentage terms, declining another 12% (78,000) between 2009 and 2010.
Retail jobs have bottomed out after a more than 10% decline, but will remain flat over the next year.
Professional and Scientific Services did not start losing jobs until the second half of the recession, but these critical, high-paying areas declined rapidly in 2009. We expect strong growth in this area as the recovery gains strength in late 2010 and 2011.
State and local governments, including public schools, will drive most remaining job loss as the private sector slowly recovers.
Housing starts bottomed in 2009 at a record low 37,000 units. Although housing starts will recover to 56,000 units in 2010, this is still the 2nd lowest level in 50 years. By 2013, housing starts will be back to normal levels exceeding 150,000 units as foreclosures finally ebb and existing home prices recover to close the gap with construction costs.
Retail sales are growing again, but will not recover their 2007 level until 2011.