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Report: Pace Of Economic Recovery To Quicken Next Year



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(Sacramento, CA)
Tuesday, February 12, 2013

We didn't fall off a "fiscal cliff." And Proposition 30 will prevent mid-year trigger cuts to the state budget.

Still, economist Jeff Michael says - don't expect a dramatic upturn this year.

"2013 looks like the fourth year of kind of slow, sluggish recovery in a row - roughly 2% growth in jobs and economic growth."

Michael heads the Business Forecasting Center at University of the Pacific in Stockton. The center's latest forecast projects that we won't start to see growth accelerate to 3% until next year and near 4% in 2015.
 
Michael says two sectors will lead job growth: technology and construction.
 
"Between now and 2016 we're going to see tens of thousands of new construction jobs statewide as many as 250,000 construction jobs over the next five years."
 
He attributes those new construction jobs to the improving housing market.
 
The report predicts California's unemployment rate won't drop below 8% until the year 2015.
 
Right now, the Bay Area leads the rest of the state in creating jobs.
 
But Michael says starting next year, the fastest pace of job growth will shift inland.
 
"We particularly expect Stockton-Sacramento to grow somewhat faster than other areas in the valley that are farther away from the urban centers."
 
Michael says the Sacramento and Stockton areas will see over two-percent job growth driven primarily by: construction and the improving real estate market.
 
Michael says Sacramento in particular stands to gain from improving government budgets. State employee furloughs will disappear for good and there's renewed optimism in the Capital region despite the uncertain future of the Sacramento Kings.
 
"Our expectation is the franchise will be leaving. We don't expect that to have a major economic impact on Sacramento. It'll make it a little less fun."

 

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