Seers Make Their Forecasts for Valley Business

Gee, it’s been two whole years since I began chronicling the gripping pathos and searing drama that is the San Fernando Valley business community. Valley@Work had birthday No. 2 last week.

Sometimes, people use anniversaries to look back upon the peaks and pitfalls of the previous 12 months. But I’d like to look at what lies ahead.

In honor of the second anniversary of Valley@Work, we’ve assembled a passel of prestigious prognosticators--economists, weather forecasters and, of course, a psychic (this is L.A. after all).

We asked our crystal-ball contingent to give their predictions for the business climate in the Valley for the coming year.

While some see sunny skies ahead, others hear the rumble of thunder and see a few storm clouds on the horizon. Invest in sun block and galoshes and you should be covered.

For the official line, we went to Jack Kyser, chief economist for the Los Angeles Economic Development Corp., who recently presented his Valley forecast to a group of business leaders.

Kyser predicted that the local economy will remain strong next year, but will not be as robust as 2000.

External forces such as Middle Eastern strife, tight petroleum supplies and uncertainty in the Asian financial markets will combine with local factors like the declining quality of the work force and increasing questions about housing affordability, he said.

The net effect?

Employment growth in the Valley region, stretching from Glendale in the east to the Ventura County line, will ease a bit--from 2% this year, with the addition of 14,600 jobs, to 1.7% next year, with an additional 12,600 jobs, he said. Most of the increase, he said, will be in the services sector, which will add 7,300 jobs. Meanwhile, manufacturing will lose 5,800.

He said 2000 “is probably going to go down in the record books as an all-time great year. But for 2001, there will be challenges.”

To Richard Stratton, a tall, barrel-chested Valley native, the year ahead looks bright for business.

Stratton is not an economist and he doesn’t play one on TV.

But he does make predictions in his twice-weekly gig at the Tarzana-based Imagine Center, a smallish shop where one can find books, cards and gifts metaphysical. It’s also home to “the best psychics in L.A.,” says owner Judy Levy--and that includes Stratton.

Stratton says he can predict the future “sometimes.” He wouldn’t list an accuracy rate, but he said people do report back that his predictions were on the mark.

Looking toward the three candles glowing beside us, he told me that I’m probably going to move or redecorate my house (isn’t everyone?); that my stepson is analytical (I wish); and that my mom’s going to take a trip soon (OK, she is, so we’ll give him that one).

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As for the Valley business community, Stratton feels that overall, “business in the Valley is going to continue to thrive. I don’t see any great difficulty over the year for business in the Valley at all.”

He predicts a slight increase in employment and only modest increases in vacancy rates in commercial real estate.

But even without checking his Tarot cards, Stratton does see some “challenges” ahead, including “some type of social upheaval that could make business in the area a little difficult” in the spring.

And just around the time that clears up, Stratton foresees there “might be some difficulty” for the entertainment industry. (He insisted that he hadn’t read anything about the threat of a strike that’s been looming for months.)

Overall, he said, “I do see it as being a prosperous time for the Valley.”

Contrast that with the sentimentsof David Charles Danielson of the National Weather Service. He’s been a meteorologist for 32 years and boasts that the record of his Oxnard-based office is pretty good when it comes to predicting rainfall totals and presaging coming floods.

“Definitely unsettled,” is the business weather pattern he sees for the coming year.

“There are too many unknowns,” he said, noting the uncertainty surrounding the presidential election. “You’ve also got things going on in the Middle East with an increase in terrorism. And that affects international trade and the price of oil.

“Every time you increase the price of oil or gas, that increases the price of everything that depends on transportation,” he said. “I think it’s going to be kind of a rough ride.

“And I’m an optimist,” he said, adding that he’s still hanging onto his investments in tech funds.

Peter Geiger, editor of the 184-year-old Farmers’ Almanac, agrees that the economy will probably pause for a breather next year.

Geiger’s Maine-based publication is noted for its annual weather forecasts, which are based on sunspots, the planets’ positions and tidal action caused by the moon. He says the forecasts are about 75% accurate.

As for the business climate, Geiger thinks “The economy in the western U.S. is probably going to step back a bit” next year, due to the impact of rising wages, fuel prices and interest rates.

“I think the pressures are there,” Geiger said. “Those are pretty prominent indicators.”

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I’m no soothsayer, but my bursitis does kick up before it rains.

With that as my only credential, I’ll toss in my own predictions.

If the Valley does not aggressively address three major issues, the prospects for continued long-term growth look dim. They are, in my humble opinion:

* The space crunch. It’s that hemmed-in feeling that comes from trying to put 10 pounds of development in a 5-pound Valley. Elected officials and business leaders need to work together to make sure that each square inch of land is at its highest and best use. Otherwise, get used to looking at the back end of outbound moving vans.

* The brain drain. I generally don’t like to beat up on the Los Angeles Unified School District. For one thing, the line’s so long. For another, it doesn’t seem like the constant barrage of attacks has helped much. But the fact remains that Valley employers, particularly at high-tech companies, complain that they cannot find the workers locally with the skills they need. Educators and business leaders need to work together to do more curriculum planning and resource sharing.

* The parking lots that are euphemistically called freeways. Enough said.

Like the tale of Ebenezer Scrooge, my predictions are not so much the visions of the things that will be, as the shadows of things that may be.

So, we’ll tune in next November to see how many, if any, of these predictions come true.

In the meantime, let’s get back to work.

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Valley@Work runs each Tuesday. Karen Robinson-Jacobs can be reached at Karen.Robinson@latimes.com.