UCLA Anderson Forecast: Orange County Economy Turning
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LOS ANGELES--(BUSINESS WIRE)-- The Orange County economy is turning up - or at the very least turning - according to UCLA Anderson Forecast's annual Orange County regional report. While the Orange County's unemployment rate remains at an unprecedented high level of 9.4%, it is nonetheless lower than that of California and the nation. The Orange County Forecast was presented today in Irvine, CA to hundreds of leaders in the Orange County business community.
"California will lag the U.S. in growth coming out of the recession due to the drag on the California economy from contraction in State and Local Government spending and employment. However, growth in the Asian economies and new innovations in computer, medical and green technologies should spur the California economy in the second half of 2010," said Jerry Nickelsburg, senior economist, UCLA Anderson Forecast. "Though labor markets remain weak in Orange County, the seeds of a recovery are seen in housing markets as well as Orange County's technology sectors. Economic growth will be slow in early 2010, but will return to more normal levels by the end of the year," he said.
The report suggests that the worst days of job loss are over and that the professional, scientific, and technical employment sectors have been largely unaffected by the recession. The healthcare and federal government sectors are still adding jobs.
The housing sector has seen a record low for new home sales this year. However, as the market turns next year, a surge in housing production in Orange County is predicted and higher selling values will prevail in 2010. "As the fear of job insecurity diminishes, more sidelined homebuyers will emerge, and happy conventional home buying will dominate the recovery in housing," the Forecast report states. "Demand for existing homes will quickly transcend the new housing market, and new development projects delayed over the last two years will be re-started."
In other highlights of the Forecast, the office real estate market is "weak and growing weaker," as the vacancy rate now exceeds 15% in the third quarter of 2009 and average lease rates have tumbled. Job creation is expected to remain weak until mid-2010, while the commercial real estate sector and the office sector cannot strengthen until job growth turns positive. Vacancy rates will continue to rise or remain high until next year. The recovery of the retail sector will begin early next year, with a healing economy aiding to consumers optimism. "Moreover, they need to reload on goods and services they've been deferring for the last 18 months," the report reveals.
About UCLA Anderson Forecast
UCLA Anderson Forecast is one of the most widely watched and often-cited economic outlooks for California and the nation and was unique in predicting both the seriousness of the early-1990s downturn in California and the strength of the state's rebound since 1993. More recently, the Forecast was credited as the first major U.S. economic forecasting group to declare the recession of 2001. Visit UCLA Anderson Forecast on the Web at http://uclaforecast.com.
About UCLA Anderson School of Management
UCLA Anderson School of Management, established in 1935, is regarded among the very best business schools in the world. UCLA Anderson faculty are ranked #1 in "intellectual capital" by BusinessWeek and are renowned for their teaching excellence and research in advancing management thinking. Each year, UCLA Anderson provides management education to more than 1,600 students enrolled in MBA, Executive MBA, Fully-Employed MBA and doctoral programs, and to more than 2,000 professional managers through executive education programs. Combining highly selective admissions, varied and innovative learning programs, and a world-wide network of 35,000 alumni, UCLA Anderson develops and prepares global leaders.
Source: UCLA Anderson School of Management
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