Forecast Calls for Continued Job Growth

Orange County’s galloping economy is picking up even more speed this year after a stunning performance in 1997, a new economic report found.

Cal State Long Beach, in its annual economic forecast, said that employment growth in the county will rise to an average of 3.9% for the year, following last year’s 3.8% surge. Much of the growth is coming from the construction, manufacturing, and finance sectors, it says. The number of jobs in construction is expected to increase more than 9% this year, while durable goods manufacturing--particularly electronic equipment--is adding jobs at about a 6% rate.

The report predicts a slower--though still strong--3% gain in employment numbers in 1999. “That is still very, very healthy,” says economics professor Joseph Magaddino, one of the authors of the study. But he says he expects the Federal Reserve Board to raise interest rates by next year to curb inflation, and that would likely take the wind out of the county’s growth next year, particularly in construction and finance.

The economic crisis in Asia will hurt profits of some county businesses, but probably will have little net effect on employment, he says. He reasons that the labor market is so tight that employers will avoid layoffs on the bet that the financial problems will be relatively short-lived.

What’s more, double-digit growth in exports to Mexico are helping offset the effects of Asia, says economics professor Lisa Grobar, who coauthored the study. “There will be individual firms that specialize in exporting to [Asia] that have a bad year,” she says. “But for the region as a whole, it won’t be bad.”

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Patrice Apodaca covers economic issues for The Times. She can be reached at (714) 966-5979 and at patrice.apodaca@latimes.com.