BY JOHN COX Californian staff writer firstname.lastname@example.org
Kern County’s economy will continue growing and adding jobs in a variety of industries for at least the next two years, an economist predicted at an annual meeting Wednesday in Bakersfield.
Economist Mark Schniepp forecast local non-farm employment growth averaging 2.6 percent per year in 2014 and 2015, beating last year’s 2 percent. He pointed to particular strengths in services, tourism, health care, education, construction, wholesale trade and retail.
“Yes, we are back, believe it or not,” said Schniepp, director of Santa Barbara-based California Economic Forecast.
That kind of optimism, placed in the context of moderate economic recovery at the state and national levels, easily outweighed any cautionary notes voiced at Tuesday’s 14th annual Kern County Economic Summit.
There was even a sense that anyone holding out for a more robust recovery may miss immediate business opportunities in the area of real estate development.
“All of us need to get moving and get this stuff going before the next thing hits,” said industrial land developer Jason Gremillion, vice president of Roll Real Estate Development LLC, owner of Shafter’s booming warehouse and distribution center, Paramount Logistics Park.
Schniepp’s local economic forecast, commissioned by summit host Kern Economic Development Corp., said the county’s unemployment rate — pegged at 12.5 percent in February — will drop to 11.2 percent this year and 10.0 percent in 2015.
At the national level, an economist with the Federal Reserve Bank of San Francisco said progress continues to be made on recovering from the recent recession, which technically started in 2007 and ended in 2009.
Senior economist Gary Zimmerman noted that the unemployment rate has been coming down but the economy is still short 700,000 of the 8.7 million U.S. jobs lost in the Great Recession. That pace lags well behind past economic recoveries, he said. Zimmerman predicted about 3 percent growth in U.S. gross domestic product — a measure of the nation’s total economic output — this year and next.
“Basically we’re looking at an economy that’s recovering modestly,” he said.
With that is expected to come improvement in Kern’s housing market. Though it won’t match last year’s 30 percent home price appreciation, Schniepp said, the county’s residential real estate market should see a 15 percent price increase in 2014, followed by a 7 percent rise in 2015.
Speakers gathered for the summit’s real estate panel said local market conditions have improved not only in housing but in office space, retail and especially the county’s rising star: industrial property.
Panel moderator Wayne Kress, a broker and principal at Cushman and Wakefield | Pacific Commercial Realty Advisors, said a lack of supply is evident across the board.
Panel members spoke of low commercial vacancy rates, new residential construction and promising development plans.
But they and others also mentioned significant challenges, if not outright threats, on the horizon. There were repeated warnings of California’s reputation for being unfriendly to business, including new and proposed oilfield regulations. Some at the conference believe those could limit the potential of the Monterey Shale, which many hope will lead to a state energy boom.
None was more adamant about addressing these challenges than economic and political strategist John Husing, vice president of Red-lands-based Economics & Politics Inc.
He emphasized Kern’s strength in sectors that don’t necessarily require higher education — oil and gas production, logistics, manufacturing, construction — and asserted each is under attack from state legislators trying to protect the environment.
But citing research by the Robert Wood Johnson Foundation, Husing said socio-economics, health behaviors and access to health care all have bigger impacts on public health than the environment.
In the end, much as Husing did at the county’s 2011 economic summit, he called for a California inland economic alliance to counter the influence of state liberals and lawmakers in Sacramento.
For original news post, click here: Kern’s economy expected to grow this year
For speaker presentations and event photos, visit our Events: 2014 Economic Summit page.