CA hiring pace will pick up in 2012, report says
California should add more than a quarter million jobs next year, says Chapman University
by Dean Calbreath 3:53 p.m., Dec. 6, 2011San Diego Union Tribune
California should experience stronger employment growth next year, with jobs being added in every major industry except finance and government, according to a forecast released Tuesday by Chapman University in Orange.
The Chapman team – which correctly predicted the beginning of the 2007 recession and the return to economic growth in 2009 – predicts the state will add 237,000 jobs next year, compared to an estimated 181,000 this year, with growth picking up after the second quarter.
“The recovery will be broad-based, with both services and goods-producing sectors gaining payroll jobs,” the report says.
There are a few events that could challenge that forecast, such as the economic problems in Europe worsening more than expected or the federal government being unable to come to agreement on the budget.
But if current trends continue, the Chapman team says, the job market in California should start revving up by the middle of next year, driven in part through growing health in California’s exports.
Following are some of the highlights of the report::
•Exports. California exported $40.5 billion in goods and services in the third quarter, an increase of $7.5 billion from the first quarter. Although Chapman forecasts that exports will decline throughout the nation next year, due to the troubles in Europe, it predicts that California exports will continue to grow, since the state is more aligned with Asia. Of California’s Top 10 trading partners, only two are in the European Union — Germany and the Netherlands — both of which remain relatively healthy.
•Manufacturing. Factory jobs grew 0.9 percent over the past year, as manufacturing stabilizes from its long-running decline. Chapman says that its survey of manufacturing purchasing managers projects continued growth next year.
•Construction. During the Great Recession, construction suffered the most of any industry in California. But it has found its footing over the past year, with 0.9 percent in job growth — although in some regions, including San Diego County, builders continue to shed jobs.
•Housing. Home prices will fall 2.5 percent throughout the state next year, partly because so many would-be homebuyers are unable to secure loans. But prices along the coast could finally stabilize.
•Consumer spending. The forecast predicts that with the pickup in hiring, taxable sales will increase throughout the state by 5.4 percent.
The Chapman report compared the current recession and “jobless recovery” to the recession and recovery in the early 1990s, when the end of the Cold War led to shut downs of defense and aerospace factories.
During that recession, California lost jobs over 34 months. It took 30 months for employment to recover to its previous peak level.
This time around, California lost jobs for 38 consecutive months. While the state generated some jobs over the last 12 months, payroll employment is still 7.3 percent below its peak level.