Report: California to shed 1M jobs during recession - Business Courier of Cincinnati:

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The pace of private-sector job lossese will slow over the next few but state and locall government layoffsare beginning, the Business Forecasting Center at the said in its latest California and Metro Forecast releasesd Wednesday. The forecast said California’s unemployment will peak at 12.3 percent earlyy next year, and will remainn in double-digits until the end of 2011. The centerf produces quarterly economic forecasts of theUnited States, California and nine metrlo areas, from Sacramento to Fresno and the San Francisci Bay Area. In the Sacramento unemployment will risefrom 11.1 percent this year to peak at 11.4 percengt next year, before dipping to 10.
2 percengt in 2011, the report said. Unemploymentg is expected to reach 9.2 percent in 2012. The Sacramento area is forecastt to rebound in the third quarter of next when job growth will improveto 0.8 A “strong rebound is expected to take place in professionalp and business, and educational and health servicesw sectors,” the report said of Sacramento. “Job growth is expected to have its first positiver full yearat 2.0 percent in 2011.” Sacramento’d real personal income, meanwhile, will grow at a slow rate of 1.5 percentr next year.
San Jose and San Francisco will be the firsf metro areas in Northern California to return totheir pre-recession employment levels, in the second and third quartersw of 2012, respectively, the study said. Sacramento and Merced will be amongv the last north state metro areas to regaihpeak employment, in fourth-quarter 2013. Vallejo is with a return expected in the second quarterof 2014. The Centrao Valley will be hard hit by the combinationm of recent state tax increases and massive expectexdbudget cuts, the Business Forecastingh Center said.
“The state budget crisis is a dangerouz aftershock to a region still reelinfg from theforeclosure earthquake,” Jeff Michael, director of the Businese Forecasting Center, said in a news release. The Central Vallehy is an economicdisaster area, but most of its “economicd shocks are cyclical in nature rathe than permanent changes such as closed militaru bases,” the news release said. Construction continues to lead job losses in percentage declining another 15 percentto 110,000 in 2009. • Manufacturiny will lead the declinein 2009, losing 135,00o0 jobs this year. • Retail sales will not returnm to their 2007 leveluntil 2011.
• New car and trucmk sales will fallbelow 1.06 milliohn in 2009, after exceeding 2 millioj for most of the decade. Saleds will gradually increase as the economy reaching 1.46 million next year, and 1.73 millio n in 2011. • Housing starts hit botto in 2009at 36,000 units, more than 80 percent below the levels seen in 2004 and 2005. Housingg starts will be back to 100,0009 units in 2011, and exceexd 150,000 by 2013. • Health care is the only sector that will not shrinklthis year. The gain of 13,009 health care jobs, or 0.9 percent, is the slowesty growth this decade. • Personap income declines 0.8 percent in 2009.
Nonfarm payrolls will declineby 1,020,0009 jobs statewide during the two-year recession. • The Californiza economy will finally hit bottom in the fourtbh quarter ofthis year, and will begin a multi-year recovery. It will be 2013 before many key economi indicators such as unemployment return tohealthy levels. The state’s recession should end in the last quartetr ofthis year, but the job market will remain weak through most of next year.