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Friday, Jun 2, 2023

L.A. City Economy Showing Broad, Robust Growth

The city of Los Angeles economy saw broad-based, steady growth last year, according to a report released this morning from Beacon Economics for the Los Angeles Area Chamber of Commerce.

The report, released as part of the chamber’s annual Los Angeles City Hall lobbying day, shows that for the 12 months ended September 2015, employment among private sector businesses in the city grew at a robust clip of 2 percent, to nearly 1.4 million jobs.

Over roughly the same period, the average annual wage in the city grew 1.3 percent to $59,300. Sales tax receipts rose 2.4 percent, while gross business tax receipts collected by the city surged 8.4 percent. And all this occurred against a backdrop of a plummeting unemployment rate in the county; that rate of 4.8 percent is now below the national average.

“Growing business activity and the improved state of household finances in the City have driven gains in private employment and construction activity,” Beacon report authors Christopher Thornberg and Robert Kleinhenz said.

The employment gains were broad-based, with 11 of 13 sectors recording gains of up to 7 percent. The biggest gains were in miscellaneous services and construction. Only private education saw a significant drop.

The report also showed a major jump in the number of residential units in mixed-use development projects getting permits over the past year and nearly half of the 13,750 housing units permitted for construction in were associated with a mixed-use project.

Looking at individual city council districts, 13 of the 15 districts saw year-over-year job growth. The Silicon Beach tech boom propelled Mike Bonin’s Westside district to the fastest growing spot at 4.8 percent, followed by Council Districts 7 and 3 in the San Fernando Valley. Council District 14, which includes much of downtown, retained the title of most total jobs.

These employment and receipts figures all came in before the first of the city’s minimum wage hikes kicked in July 1, raising the wage to $10.50 an hour. The minimum wage will continue to rise until it reaches $15 an hour for larger businesses in 2020. Some economists – including Beacon’s Thornberg – have said these hikes could slow employment growth in the city.

The report will be used by the chamber as it lobbies city officials to pursue policies that promote job growth. Among the chamber’s top priorities: continuing the modernization of Los Angeles International Airport, more reductions in the gross receipts tax and building more affordable and market-based housing.

Public policy and energy reporter Howard Fine can be reached at hfine@labusinessjournal.com. Follow him on Twitter @howardafine.

Howard Fine
Howard Fine
Howard Fine is a 23-year veteran of the Los Angeles Business Journal. He covers stories pertaining to healthcare, biomedicine, energy, engineering, construction, and infrastructure. He has won several awards, including Best Body of Work for a single reporter from the Alliance of Area Business Publishers and Distinguished Journalist of the Year from the Society of Professional Journalists.

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