California will see slow growth next year, Chapman University forecast says
California has lost nearly one million jobs since August 2007 and those jobs will be slow to return to the state, according to a forecast released today by the A. Gary Anderson Center for Economic Research at Chapman University.
The forecast, presented at the Orange County Performing Arts Center in Costa Mesa, points a finger at the construction sector for slow growth in the state's economy, even as the national economy starts to rebound.
"It will be a very gradual, slow recovery, but it should gain steam as we go to late 2010," said Esmael Adibi, a Chapman economist.
As consumers domestically and overseas start to spend again, the state's high-tech and logistics industries should start to rebound, Adibi said. During the recession many companies cut back on production, so inventories are low across the country. When demand picks up, those inventory gaps will have to be filled.
Private-sector job creation should pick up in the second quarter of 2010, Adibi said, as education and health sectors grow. The professional and business service sector -- which includes attorneys and accountants -- will also expand next year. High tech will start hiring in the second half of next year, he predicted.
Chapman says that the recession and recovery will look like a square root sign -- some growth followed by leveling off, rather than the traditional V-shape of a traditional deep recession and recovery.
As for returning to employment levels before the recession, Adibi said, "It's going to take forever."
-- Alana Semuels
Photo: Chapman University economists say this recovery will look a square root sign, not a V.