LOS ANGELES (CBS) — The economic recovery in Los Angeles County continues to gain momentum, fueled by international trade, entertainment and tourism, but unemployment will remain “painfully high” at least through 2012, according to a report released Wednesday.
The Los Angeles County Economic Development Corporation’s 2011-12 “Economic Forecast and Industry Outlook” predicts job growth this year and next, but expects that the jobless rate will still be 11.7 percent through 2012.
KNX 1070’s John Brooks reports for the first time since the “Great Recession” began in 2007, the Los Angeles County Economic Development Corporation says more jobs will be added than lost.
“We project that the U.S. economy will grow slightly in 2011 and 2012,” LAEDC Chief Economist Nancy D. Sidhu said, “but the recession was so deep, 2011 won’t feel especially good despite improvements in most industries.”
Sidhu projected a drop to the “low eights” in the U.S. unemployment rate by 2012, but said Los Angeles will continue to lag well behind both national and state rates.
Still, the Los Angeles economy “appears to be past the bottom of the recession and is starting up the recovery path during 2011 and 2012,” Sidhu said.
An uptick in international trade last year is expected to continue, benefiting the ports of Los Angeles and Long Beach and creating new jobs. Both ports posted record years in 2010.
Entertainment industry employment rebounded last year, with more motion pictures, television pilots and shows and commercials being filmed.
Tourism also turned up in 2010 and that trend is expected to hold in 2011-12. New hotels downtown and in Hollywood drew more business and leisure travelers.
Housing will likely have another tough year, with tighter bank underwriting, a still-weak labor market and lots of foreclosures and short sales hurting builders’ ability to complete with bargain-priced existing homes, according to the report.
The healthcare industry has been a reliable source of jobs, even in a downturn, given the region’s quality hospitals. But healthcare reform could impact future job growth, according to the economists.
Major construction planned at the two ports, Los Angeles International Airport and the downtown civic center, as well as transportation projects by the Metropolitan Transportation Authority will also generate jobs and economic support.
But private nonresidential construction hit a low point in 2009-10 and seems likely to stay at those levels in 2011.
Also working against recovery will be expected layoffs and service cuts in the public sector, as the state and local governments struggle to cope with huge deficits.
One historical contributor to the local economy, the aerospace-defense industry, is now operating in an unpredictable environment. Changing priorities at the Department of Defense and NASA and defense budget cuts will impact programs in Los Angeles, with some firms winning business and others suffering cutbacks, leaving the net outcome uncertain.
The economists laid out five goals “to ensure the region’s economy will prosper after the recovery is completed,” LAEDC President and Chief Executive Officer Bill Allen said.
Those objectives include preparing an educated workforce; creating a business-friendly environment; enhancing our quality of life; implementing smart land use; and building 21st-century infrastructure.
The LAEDC is a private, nonprofit organization established in 1981. Its mission is to attract, retain and grow businesses and jobs in Los Angeles County.
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