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Economic experts fear Calif. recession

July 15, 2008 12:00:00 AM PDT
California's economy is on the brink of a recession, according to a new economic report due out Wednesday.It looks like people will now have to work a little bit harder to save where they can, and that's because experts say California's economy right now is on the brink of a recession.

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"The U.S. probably is in a recession if you do the official definition," said Jack Kyser, L.A. County Economic Development Corporation. "California on the brink, and if you look at Southern California, Ventura County, Orange County, and Riverside/San Bernardino -- all three in recession."

That is the latest economic forecast by Jack Kyser.

Already in L.A. County, the unemployment rate has jumped from 5 percent in 2007 to 6.2 percent in 2008.

Kyser said the worst is yet to come for places like Orange County and the Inland Empire: 18,600 jobs are expected to be lost from Orange County, and 20,500 jobs are expected to be lost in the Riverside/San Bernardino area in 2008.

Experts say foreclosures, rising gas prices and a slump in retail sales are some of the contributing factors to the weak economy. Kyser said the Writers Guild strike and the potential SAG strike hasn't helped either.

"Now what you're seeing is that feature-film production has slowed in Los Angeles to a trickle," said Kyser. "Television production is still going on, but people are waiting to see what happens with the Screen Actors Guild."

Bruce Ackerman, with the San Fernando Valley Economic Alliance, said things aren't that bad in the Valley. In fact, he says, some local manufacturing businesses are hiring right now.

"The biggest complaint we hear from our manufacturers is they've got a lot of people that are aging out, that are retiring, that are 50 years old and older engineers. They can't find replacements," said Ackerman.

But even with bright spots, experts say the latest economic forecast shows people should be careful.

Experts say some ways that people can be careful with their money is of course by watching what they purchase, and doing research any time they want to put their money in a bank. They say if one bank is offering higher interest rates over another institution, they definitely want to be cautious.

Jack Kyser says that despite his grim economic forecast, he says there are actually some industries that are doing quite well right now in Southern California, including health services, private education, international tourism, and the technology sector. All are local industries that are hiring right now.

 

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