San Gabriel Valley’s unemployment rate is expected to dip below 4 percent this year as the region gains about 7,500 jobs, according to a forecast released last month by Los Angeles County Economic Development Corp.
The forecast projects the region’s unemployment rate will fall to 3.9 percent this year from 4.2 percent last year. Both figures are four-tenths of a percentage point lower than the countywide averages. The rate is forecast to drop slightly again next year to 3.8 percent. Any figure below 4 percent is regarded by most economists as a sign of full employment.
The mid-March forecast also projects total employment in the 31 cities comprising the San Gabriel Valley to rise to 698,700 this year, an increase of 1.1 percent from last year. A smaller gain of 0.8 percent to 704,000 is forecast for next year. The total population of the 31 cities and unincorporated areas was nearly 1.54 million last year.
“The San Gabriel Valley is on a path of modest but steady economic growth reflecting the rest of the regional economy as a whole,” Somjita Mitra, director of the Institute for Applied Economics at the LAEDC, said in an email. “Jobs will continue to be added and unemployment will continue to decline.”
San Gabriel Valley residents can expect to see significantly higher wage growth as part of the trend. The forecast calls for 3.2 percent payroll wage growth to $35.9 billion, due to “a combination of both rising wages, with the labor market tightening and higher levels of employment.”
The faster wage growth will go some of the way towards narrowing a gap that exists between the San Gabriel Valley and the rest of L.A. County. The average annual wage for San Gabriel Valley residents was $52,600 in 2016, according to the report, compared with $63,000 countywide average.
Wages were lower for all sectors of the San Gabriel Valley economy except in construction, where the average wage was 2.3 percent higher than the county as a whole.
The full employment picture and forecast for faster wage growth was welcomed by the San Gabriel Valley Economic Partnership, which was one of the sponsors of the March 13 forecast event.
“The San Gabriel Valley economy is gradually expanding with all industry sectors moving forward in a positive direction,” Jeff Allred, the partnership’s chief executive, said in an email. “While wages may be lower than other parts of LA County, the San Gabriel Valley continues to be relatively more affordable and offers a welcoming business climate with full employment and a high quality of life.”
The forecast found public administration (up 3,400), health services (up 2,700) and leisure/hospitality (up 2,500) were the biggest gainers among employment categories last year. Retail posted the biggest drop in payroll jobs (down 700), followed by manufacturing (down 500).
– Howard Fine
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