Southern California Job Market : The California Economy: 1990 and Beyond
1. Unemployment: California and the U.S.
Unemployment in California has typically lagged the U.S. rate. But that is expected to be reversed through 1993 as downsizing in the aerospace industry continues. The state jobless rate will rise from an estimated 5.5% this year to a peak of 7.3% in 1991, falling to 6.3% in 1992 and 6.1% in 1993. The national rate is projected at 6.8% in 1991.
2. Retail Sales, Including Autos
A weakening economy will take its toll on consumer spending, affecting retailers ranging from small shops to the Southland’s toniest shopping malls. Inflation-adjusted retail sales will finish the year up a scant 0.4% and then drop 2.1% next year. Growth in 1992 is expected to be a brisk 4.5%. Car sales will average 1.38 million in 1990, 1.31 million in 1991 and 1.48 in 1992.
3. Commuting Time and Distance
In a survey taken in 1989, Commuter Computer found that the median commute to work lasted 30 minutes, 10 minutes longer than in 1988. The ride home lasted 40 minutes, compared to 25 minutes in 1989. But the median distance remained fairly constant, 10 miles in 1989 compared to 9 miles in 1988. But carpooling is beginning to have a small impact, with the number of people driving to work alone actually declining by about 4% a year.
4. Housing Construction and Prices
The housing market will continue to be soft through at least the early part of the decade, leading to mounting layoffs in the construction industry. Housing construction is expected to decline the rest of this year and in 1991 but should turn around in 1992 and 1993. Prices will remain soft. In the nine-county Southern California area, the lowest priced new homes are to be found in Kern County (median $103,000) and the most expensive in Ventura County ($310,000).
5. Multifamily Housing and Rent
The pressure of population growth and prohibitively high single-family housing prices will keep the vacancy rate low and rents high in urban areas of the state. Further, multifamily building permits have actually been decreasing since 1987. The citywide average rent in Los Angeles is $675.17. That is based on a range of $491.97 for a single and $1,147.42 for a three bedroom apartment.
6. Population Growth and Immigration
While the U.S. population is projected to grow 7% between 1990 and 2000, California’s is likely to swell 18% to 35 million. The trend should ease after 2010 as the birthrate drops and immigration slows. A large part of the near-term growth continues to be due to illegal immigration, with one estimate putting undocumented immigrants from all countries at 100,000 a year.
Population by Age
The segments of state population aged 35--64 and 64+ are the fastest growing. This reflects the national “graying of America” trend.
1990: 0-17: 27% 18-34: 32% 35-64: 31% 65+: 10% 2010*: 0-17: 25% 18-34: 23% 35-64: 39% 65+: 13% * projected
Ethnic Makeup
California will continue to be among the most ethnically diverse states in the U.S. That is influenced largely by immigration, legal and undocumented, with one estimate putting foreign migration at 80% of the total new arrivals between 1980 and 1989.
1980: White: 66.6% Hispanic: 19.2% Black: 7.5% Asian and Other: 6.7% 1990: White: 57.8% Hispanic: 24.8% Black: 7.1% Asian and Other: 10.1% 2000*: White: 51.1% Hispanic: 29.3% Black: 6.1% Asian and Other: 13.0% * projected Southland Employment 1985: 6.75 million 1987: 7.13 million 1989: 7.70 million 1991*: 8.07 million 2000*: 8.43 million * projected Per Capita Income / Southern California adjusted for inflation (1988 dollars) 1979: $16,936 1988: $19,023 2000*: $22,558 * projected Sources: UCLA Business Forecasting Project; California Employment Development Department; Center for the Continuing Study of the California Economy; Commuter Transportation Services Inc; Construction Industry Research Board; L.A. Rent Stabilization Board; Caltrans; U.S. Commerce Department; U.S. Bureau of Labor Statistics.
Research: Melanie Pickett
