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Institute issues gloomy forecast for 2014


Tuesday, February 4, 2014

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The self-described "pessimistic and cautious" forecast projects that the county will add only 21,000 jobs this year, down from 23,100 in 2013. Although the total workforce will approach the all-time, pre-recession highs of 2007, that will not be enough to make up for the seven years of population growth since then.
As a result, the jobless rate -- currently at a five-year low of 6.7 percent after seasonal adjustments -- will remain relatively static throughout the rest of the year, averaging at 6.8 percent, the report said.
“The pace of economic expansion remains stubbornly sluggish and recovery continues to be uncertain and frustratingly slow,” said economist Kelly Cunningham, primary author of the report.
Cunningham's report was one of the gloomiest forecasts issued so far this year.
Lynn Reaser, chief economist at Point Loma Nazarene University, predicts that the county will add more than 20,000 jobs this year, pushing the jobless rate to between 6 percent and 6.5 percent by year's end. "Gains in construction, technology, leisure and hospitality, and international trade should bolster San Diego’s job market," Reaser said.
Alan Gin, economist at the University of San Diego's Burnham-Moores Center for Real Estate, was even sunnier, forecasting last week that 25,000 jobs will be added, driving the jobless rate to below 6 percent.
Cunningham sees some bright spots in the economy for 2014, including a 9 percent rise in residential construction permits to 9,000 units, including 2,600 single homes and 6,400 multifamily units. But partly because of the downturn in defense spending as the war in Afghanistan winds down, he predicted that the county's overall economic growth will slow from an estimated 2.2. percent in 2013 to 1.8 percent in 2014.
"Overall, 2014 is not shaping up as a year of accelerating recovery but largely, and unfortunately, more of the same,” Cunningham said.