Growth Predicted for Southland
Southern California’s economy will grow at a healthy pace this year and next, aided by improving outlooks for business and professional services, technology, tourism and bio-medicine, according to an economic forecast to be released this morning.
However, two of the region’s signature sectors -- movie/TV production and international trade -- face tougher outlooks although they should continue to add jobs, according to the Los Angeles County Economic Development Corp.
The Southland this year is expected to enjoy its strongest growth since 2000, although the pace of expansion will slow slightly next year, the nonprofit business support organization said in its mid-year outlook.
Tourism is expected to benefit from the King Tut exhibit at the Los Angeles County Museum of Art and Disneyland’s 50th anniversary celebration, the forecast said.
“L.A. is hot again,” said Jack Kyser, the group’s chief economist and principal author of the report. Los Angeles Mayor Antonio Villaraigosa “is really reaching out and supporting tourism in Los Angeles” by making personal calls urging organizations to hold meetings here, he said.
Technology jobs are rebounding, while the region’s bio-medical industry is expected to benefit from increased stem cell research, the report said. Within the business and professional services category, accountants and lawyers are expected to gain work from increased corporate financial reporting requirements, while architects probably will see more activity with a pickup in office building development.
Although local movie and TV production remains strong, the shift of filming to foreign locales -- particularly Canada -- has rebounded the last three months, Kyser said. A rebounding dollar has reduced costs of filming abroad, he said.
“Canada is the threat again,” Kyser said.
As for trade, while congestion at local ports has eased, there still is a “perception of congestion,” Kyser said. Thus, some shipping is being diverted to the ports of Oakland, Seattle and Tacoma, Wash., he said.
The Southland economy also faces additional risks, including the possibility of a housing bust, potential closures of military bases and high energy costs, the report said.
Riverside-San Bernardino is expected to continue to post the Southland’s strongest job growth rates, with estimated 3% gains for this year and 2006, the business organization predicted. Orange County would follow, with estimated job growth rates of 1.9% in 2005 and 1.8% in 2006.
Los Angeles County is expected to post job gains of 1% this year and 1.1% next year, the group said. Of the 41,600 new jobs in the region’s biggest county, an estimated 11,500 would be produced by the construction sector.
But significant divergences in growth exist within Los Angeles County, the report said. Three subregions stand out as “overachievers”: East San Fernando Valley, San Gabriel Valley and West Los Angeles. Two subregions, however, stand out as needing more support: the southeast area and South Los Angeles.
