Report: California regional economic outlook
California demonstrated its economic resilience throughout 2013 and the first quarter of 2014, despite lingering effects of the Great Recession, higher state tax rates, federal government shutdown, and the fierce debt ceiling debate in late 2013.
Our economic report, coauthored with my fellow Bank of the West Economist Myasnik Poghosyan, analyzes the effects of that resilience and focuses primarily on the four major regions of the state: Bay Area, Central Coast, Central Valley, and Southern California.Key highlights:
- California job creation is expected to be led by three main sectors: professional & business services, education & health services, and leisure & hospitality.
- The Bay Area will remain the fastest growing region in California, with healthy job growth in information, tourism, and construction.
- California is forecast to add 334,000 nonfarm jobs (+2.2%) in 2014, and another 356,000 jobs (+2.3%) in 2015.
- The state sees an operational budget surplus of $2.2 billion this fiscal year — the first state surplus in a decade.
- Downside risks for California include a potential cooling off in investment activity in the Bay Area, poor housing affordability and sluggish home sales, and a sharp decline in agricultural output in California’s Central Valley and Central Coast due to the exceptionally dry weather.
You can read the full report from Bank of the West Economics here.