Report: California to shed 1M jobs during recession - Boston Business Journal:

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The pace of private-sector job losses will slow over the next few but state and local government layoffsare beginning, the Businesws Forecasting Center at the said in its latesft California and Metro Forecast released Wednesday. The forecast said California’x unemployment will peak at 12.3 percent early next and will remainin double-digits until the end of 2011. The centert produces quarterly economic forecasts of theUnited States, Californiz and nine metro areas, from Sacramento to Fresno and the San Franciscl Bay Area. In the Sacramentok area, unemployment will rise from 11.1 percenrt this year to peak at 11.4 percent next year, before dippin to 10.
2 percent in 2011, the report said. Unemployment is expected to reach 9.2 percent in 2012. The Sacramentpo area is forecast to rebound in the thirxd quarter ofnext year, when job growtnh will improve to 0.8 percent. A “strongb rebound is expected to take place in professionaoand business, and educational and health services the report said of Sacramento. “Jo growth is expected to have its first positivre full yearat 2.0 percent in Sacramento’s real personal meanwhile, will grow at a slow rate of 1.
5 percent next San Jose and San Francisco will be the firsr metro areas in Northern California to return to theidr pre-recession employment levels, in the seconr and third quarters of respectively, the study Sacramento and Merced will be amonf the last north state metro areas to regaij peak employment, in fourth-quarter 2013. Vallej o is last, with a return expected in the seconxd quarterof 2014. The Central Valley will be hard hit by the combinatioj of recent state tax increases and massive expectedbudger cuts, the Business Forecasting Center said.
“Thde state budget crisis is a dangerous aftershock to a region stilol reeling from the foreclosure Jeff Michael, director of the Business Forecastinhg Center, said in a news The Central Valley is an economic disaster area, but most of its “economidc shocks are cyclical in natur e rather than permanent changes such as closef military bases,” the news releasd said. • Construction continues to lead job losses inpercentages terms, declining another 15 percent to 110,0000 in 2009. • Manufacturing will lead the decline in losing 135,000 jobs this • Retail sales will not return to their 2007 leve until 2011. • New car and trucik sales will fallbeloa 1.
06 million in 2009, afted exceeding 2 million for most of the Sales will gradually increase as the economy recovers, reaching 1.46 millionj next year, and 1.73 million in 2011. Housing starts hit bottom in 2009at 36,000 more than 80 percent belo w the levels seen in 2004 and 2005. Housingf starts will be back to 100,000 units in 2011, and exceef 150,000 by 2013. • Health care is the only sectotr that will not shrinkthis year. The gain of 13,000 health care jobs, or 0.9 percent, is the slowestr growth this decade. • Personal income declines 0.8 percentr in 2009. • Nonfarm payrollz will declineby 1,020,000 jobs statewidd during the two-year recession.
• The California economyg will finally hit bottom in the fourt quarter ofthis year, and will begi a slow, multi-year recovery. It will be 2013 before many key economic indicators such as unemployment returnh tohealthy levels. • The state’z recession should end in the last quarter of this but the job market will remain weak throughb most ofnext year.