Pessimistic Economists Generally Hit Target; the Optimists Misfired : Forecasts: Experts underestimated the recession’s fortitude. An analyst still gives them high marks.

An economist is a man that can tell you . . . what can happen under any given condition, and his guess is liable to be as good as anybody else’s, too. --Will Rogers

Looking into the future proved an especially dangerous undertaking in 1992.

Economists, analysts and other prognosticators who predicted a turnaround in the local economy mid-year were disappointed.

In fact, only the most pessimistic of predictions hit near the bull’s-eye.

Many figures, including the tally of jobless people, are current only through October at this writing. But the numbers show that some predictions won’t be met by the end of the year.

Economists at Chapman University, who have been forecasting local economic trends for 15 years, predicted that the county would gain 9,400 jobs this year. That was last December.

In June, Chapman economists revised their prediction for 1992, based on more recent numbers issued by the state. The Employment Development Department said it had mistakenly underestimated the number of jobs lost in 1991--by 48,100, or almost 4%.

Given the new figures, Chapman said the county would lose 7,000 jobs by the end of this year.

The university was still wrong. The employment results for October show the county had already lost 32,900 jobs since October, 1991.

“Any forecast will have some errors,” said Esmael Adibi, who studies the local economy for Chapman’s Center for Economic Research. He said improvements in the county job situation are taking place now.

Still, Chapman has to be admired for sticking its neck out each year. UC Irvine relies on surveys of business executives rather than a home-grown economic model. And, until this year, Cal State Fullerton’s economics department contented itself with looking at the year in review.

The state university published its first 1993 forecast in late October.

But UCI and Cal State Fullerton professors are not off the hook for 1992. Even though they did not make their own detailed forecasts, they agreed in interviews during the early part of the year with Chapman’s staff.

“Everyone’s estimate was off,” said Eleanor Jordan, the Orange County labor market analyst for the state Employment Development Department. Jordan, the most pessimistic of the local experts, said from the start of the year that the job market would remain lousy in 1992.

This was an unusually difficult year to call, Jordan recently said of the academicians’ optimism. She said she believes the quality of forecasting in the county is generally high.

“They all get an ‘A’ or an ‘A minus’ ,” she said.

Anil Puri, dean of the economics department at Cal State Fullerton, agreed that one shouldn’t be too hard on the Chapman forecasters: “This recession has been unprecedented. I think it’s universally true that most economists have missed it this time.”

Economists were not the only ones making predictions in 1992. Early on, local developers and real estate analysts said that the housing market would rebound this year. New home sales would increase by as much as 20% over the previous year, some said.

Jeffrey S. Meyers, president of the Meyers Group, a real estate consulting firm based in Newport Beach, was conservative. He predicted a 5% to 10% increase in sales over 1991.

But even conservative predictions proved wrong. TRW Redi Property Data on Tuesday estimated that the number of new homes to be sold this year will fall by 17% from last year, from 6,288 to 5,219.

And a report last week by the California Assn. of Realtors said that November sales of preoccupied homes in Orange County fell 9.4% compared with November, 1991.

Some predictions--though smaller in scale--did, however, come true:

* Chapman said the number of jobs would begin growing late in the third quarter. In fact, from August to October, the number of jobs in Orange County grew by about 0.5% compared with 0.4% growth during the same period in 1991.

* Adibi said service industry jobs would increase in the second and third quarters of 1992. He was partially right. In the second quarter, the number of service jobs grew by 0.8%; it fell by 0.1% in the third quarter. In 1991, the comparable figures were a 0.6% growth followed by a 0.6% decline.

* The three universities’ specialists and Jordan predicted that the unemployment rate would remain high through the summer, which it did: from 6.7% in June to 6.1% in July and back to 6.7% in August. The June and August figures were the highest monthly unemployment rate since the 7% rate reported for August, 1983.

Economists are often and easily criticized.

Many will find comfort as 1992 ends in ignoring Will Rogers and listening, instead, to John Maynard Keynes. He said: “There is no harm in being sometimes wrong--especially if one is promptly found out.”