Southern California growing as global trade hub, report says
International trade traffic through Southern California, home of the nation’s busiest seaport complex, will increase by more than 10% this year after a couple of dismal recessionary years, but trade-related employment won’t begin to grow again until 2011, according to a report scheduled for release Wednesday by the Los Angeles County Economic Development Corp.
“The last two years were very tough for the Los Angeles gateway,” said Jack Kyser, an economist with the business promotion group. “The good news is that we are back on a growth path. But it will take at least a couple of years to get back to the kind of business we had in 2006.”
The report covers the Los Angeles Customs District. The ports of Los Angeles and Long Beach are the main contributors to its numbers. They are followed in significance by Los Angeles International Airport, which is fifth among U.S. airports and 13th internationally in the trade it handles. Much smaller players are Ontario International Airport, Port Hueneme, McCarran Airport in Las Vegas and several oil terminals.
The report describes the customs district as a vital economic resource for Southern California that in 2009, the worst year of the global recession, still handled $283 billion in imports and exports and supported 482,500 jobs. The value of trade will increase by 8% to $309 billion, the report predicted. But cautious employers will be slow to hire in 2010, with the first significant gain of about 15,000 jobs coming in 2011.
That will mean a total of about 492,700 trade-related jobs in 2011, far short of the peak trade employment of 562,700 in Los Angeles, Orange, Ventura, Riverside and San Bernardino counties in 2007. That level won’t be reached again until 2015, the development group said.
“People were badly burned by the downturn,” Kyser said. “Shippers and ports and other employers are going to be very cautious. There is still a lot of uncertainty about how strong this economic recovery will be.”
As bad as it was in Southern California, it was worse for the remainder of the nation’s top five customs districts. New York, Detroit, Houston and New Orleans each lost between 24.5% and 31.5% in the value of the trade they handled in 2009, compared with Los Angeles’ decline of 20.4%.
The Los Angeles and Long Beach ports accounted for most of the $272.2 billion in sea trade in 2009. LAX handled most of the $65.4 billion in air freight.
There was a shake-up in the Southern California’s roster of top trading partners.
The $7.3 billion in business with Vietnam in 2009 was good enough to move it from the 11th spot to No. 8 on the L.A. foreign trade list. That helped knock Germany — which had been the last European nation in the top 10 — down to 11th. China’s $155.3 billion in trade far outpaced any other country.
