Los Angeles County should see more robust job growth for the remainder of this year, while surrounding counties will see their job growth slow as the impacts of interest rate hikes kick in, according to an economic forecast from California State University Long Beach released Wednesday.

The Cal State Long Beach forecast predicts payroll job growth in Los Angeles County for the entire 12-months of 2006 will rise to 1.2 percent from the 2005 growth of 0.5 percent. The additional hiring will be led by growth in professional and business services and government agencies.

Manufacturing, which had been a drag on the local economy with major job losses in previous years, has stabilized and will only see very slight job loss this year, the forecast said. That puts less downward pressure on the rest of the job outlook, according to Lisa Grobar, professor of economics at Cal State Long Beach.

"Some of the problem areas that had been holding back L.A's economy in the earlier years of this decade are now resolving themselves," she said.

Overall, the forecast calls for job growth for the Southern California region to slow to 1.5 percent for all of 2006 from 1.7 percent for 2005. That's because payroll job growth rates in surrounding counties, which had significantly outpaced Los Angeles County for each of the last three years, will slow. The reason: rising interest rates will choke off activity in the housing and construction sectors, as well as the finance sector.

The most significant slowing is expected to occur in Orange County (to 1.2 percent in 2006 from 2.3 percent in 2005) and the Inland Empire (to 3.2 percent in 2006 from 4.9 percent in 2005). "Orange and Riverside counties will be especially hard hit by the cooling off of the housing market," Grobar said.

By comparison to these counties, Los Angeles County is underweighted in housing-related employment, which is why it's expected to buck the regionwide slowdown in payroll job growth, she said.

But the forecast says this regional slowdown will only be temporary; job growth is expected to tick up to 1.8 percent in 2007, thanks in part to healthier public sector budgets and an infusion of funds for public works projects.

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