(Source: Merced Sun-Star)
By Merced Sun-Star, Calif.
April 22--You wouldn't know it by looking at the unemployment rate -- 21.4 percent in Merced County -- but experts see some encouraging signs that the valley's terrible economy is beginning to recover.
We hope so. The recession has been a crushing blow to the region, with home foreclosures among the worst in the nation, and job losses devastating families.
But they warn that the recovery could reverse itself because of the potential for more job layoffs by state and local governments, as they attempt to balance their budgets. Merced's recent announcement that it would cut 64 positions from the city budget won't help matters.
"When you look at how important government is to this region, and how many people draw paychecks from schools, government and corrections, there's a lot of uncertainty over the state budget," said Jeffrey Michael, director of the Business Forecasting Center at the University of the Pacific . "We know there's a blow coming from that direction, but we don't know how bad it will be."
According to the California & Metro Forecast released Tuesday by the Eberhardt School of Business, real personal income in Merced County is expected to rise 4 percent this year, slow in 2012 and then increase again to 3.4 percent in 2013. Merced's unemployment could rise slightly in 2012 because of a population increase and then drop slightly to 17.3 percent in 2013 and 16.1 for 2014. But enough job growth is expected by 2013 to raise overall payroll employment above the boom years of 2007-08.
UOP's report shows that the economic situation varies widely by region. "Technology oriented economies such as San Jose are experiencing robust growth," the report notes, but Sacramento's economy continues in a significant recession and is likely to get worse because it depends so heavily on government payrolls.
We are not out of the woods, but it's encouraging to see that the private sector economy in Merced and the Northern San Joaquin Valley is starting to bounce back.
A summary of the UOP report is available at http://forecast.pacific.edu.
-----
To see more of the Merced Sun-Star or to subscribe to the newspaper, go to http://www.mercedsunstar.com.
Copyright (c) 2011, Merced Sun-Star, Calif.
Distributed by McClatchy-Tribune Information Services.
For more information about the content services offered by McClatchy-Tribune Information Services (MCT), visit www.mctinfoservices.com.
A service of YellowBrix, Inc.