The L.A. economy will continue to endure "intense pain" for the rest of 2009, according to the annual economic forecast from the Los Angeles County Economic Development Corp. The forecast shows that recovery will begin in 2010.
The forecast, released today, projects 89,000 payroll jobs in the county will be lost in 2009, a drop of more than 2 percent from 2008 levels. Meanwhile, the unemployment rate will average more than 10 percent and edge toward 11 percent in 2010, topping the levels of the early 1990s.
"Almost all major Los Angeles industries will struggle during 2009," said Jack Kyser, founder of the Kyser Center for Economic Research at the LAEDC. "It will be the end of 2009 before signs of recovery start to appear and well into 2010 before people really notice any recovery."
Retail, manufacturing and construction will continue to be the hardest hit industries, each shedding around 20,000 jobs, according to the forecast. Another 5,000 jobs are expected to be lopped off government payrolls this year. Weakness in trade activity and tourism will contribute to job losses.
The forecast also projects total personal income to decline by 2 percent in 2009 before stabilizing in 2010. More importantly for government coffers, taxable sales are expected to drop by nearly 6 percent, one of the steepest declines in decades. For comparison, taxable sales declined 2 percent in 2008.
The few bright spots: aerospace, transportation and related infrastructure construction projects that will be fueled with federal stimulus dollars. Health services are expected to post a small gain in jobs, as is private education.
The housing sector should stabilize late in the year, the forecast said, unless a larger-than-expected wave of foreclosures sweeps through the multifamily building segment.
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