Despite Ongoing Job Losses in Rest of State,
(NORTHRIDGE, Calif., Nov. 7, 2003) - Despite ongoing job losses in the rest of Los Angeles County and the state of California, the San Fernando Valley experienced growth in 2002, according to a new study issued today by Cal State Northridge researchers.
the San Fernando Valley is Experiencing Growth
The Valley's private sector added 2,000 jobs in 2002 after losing nearly 4,900 in the recession the year before. The Valley's mild 0.3 percent job growth contrasted with private sector job losses in Los Angeles County of 1.6 percent and the state, which lost 1 percent, the report said.
"Relatively speaking, the Valley is in good shape," said Daniel Blake, director of Northridge's San Fernando Valley Economic Research Center. "Jobs in the Valley are growing slowly, and unemployment is slowly dropping. And though the large entertainment and manufacturing industries lost some jobs, they were more than made up for by job growth in other areas."
Blake noted that the information industry, which includes the entertainment, remains the top employer in the San Fernando Valley, with 92,500 jobs and 22 percent of the private sector payroll. Manufacturing comes in second with 82,900 jobs and 13 percent of the payroll.
While both industries lost jobs in 2002—information shed 6 percent and manufacturing dropped by nearly 10 percent—job growth occurred in the Valley's other industries, which made up for the loss. Among employers that experienced growth were those in the health care and social assistance industry, about 10 percent; finance, insurance, real estate and leasing/rental industry, 4.6 percent; retail trade, 3.5 percent; biotech industry, 2.7 percent; and construction industry, 2.5 percent.
Blake said Valley unemployment insurance claims hit eight-year highs in mid 2002 and then receded. Adjusting the unemployment insurance claims for seasonal factors and for extended benefits puts the high point of the claims in the second quarter of 2002, with claims largely on the wane but still at elevated post-recession levels.
The center released its annual report on the state of the San Fernando Valley economy today at the 15th annual Business Forecast Conference of the Valley Industry and Commerce Association (VICA).
Each year, researchers at Northridge's San Fernando Valley Economic Research Center take a comprehensive look at what is happening in the Valley—an area roughly bounded by the Santa Susana Mountains to the north and west, the Santa Monica Mountains to the south, and the San Gabriel Mountains to the east—both economically and socially.
Blake and his team did find some hope when it came to housing in the Valley and home prices. Though home prices continued their steep ascent this summer, with median prices rising to $369,000 and average prices close to $420,000, a recent rise in mortgage rates seems to be slowing the rate of increase.
"There's some hint now of moderation within the September numbers in the rate of growth in prices," Blake said.
The report noted that home sales continued at a new record pace this past year and inventories fell to a 2.1-month supply, down from 2.8 months last year.
Apartment vacancy rates in the Valley remain stuck below 3 percent, signaling an ongoing very tight rental market. In response, average rents in large complexes rose 6.3 percent in 2002, and are on course for an annual increase of 8 percent in 2003.
Among other findings in the report:
Population growth: Researchers found that the area's population grew faster than previously reported, especially in the Los Angeles city portion of the Valley. The Los Angeles portion growth has averaged 1.8 percent since 2000, instead of 0.6 percent, as previously estimated. The Valley population grew by 27,500 (1.9 percent) people in 2002, with more than 13,000 people moving into the area and the remainder coming from a natural population increase.
Payroll: The Valley's private sector payroll also grew by 1.5 percent in 2002, but its inflation-adjusted real payroll slipped by 1.2 percent relative to 2001. L.A. County's real private sector payroll dropped by 2.6 percent and California's by 4.5 percent.
Tourism: Recent Valley tourism and travel activity has been a mixed bag. Airport passenger traffic returned to pre-9/11 levels in the first half of 2003, but hotel occupancy rates remain about 5 percentage points below their pre-9/11 levels, and inflation-adjusted real room rates are 10 percent below their pre-9/11 levels.
Schools: Enrollment at Valley public schools grew 4.5 percent in 2002-2003, with the Los Angeles Unified School District growing the most at 5.7 percent. At the same time, Valley private school enrollment fell 0.4 percent.
A roundup of Census 2002 data revealed a number of interesting characteristics of Valley residents. They are mobile—nearly 50 percent changing residence in the last five years. Most moved from within the county, but about 6 percent moved from elsewhere in California, 7 percent from another state and 11 percent from another country.
Compared to the city of Los Angeles and the rest of the county, more Valley residents have high school diplomas and college degrees, more have higher incomes, are employed, self-employed, over the age of 65 and fewer are younger than 18, and fewer Valley residents live in poverty.
For a copy of the report, contact Northridge's San Fernando Valley Economic Research Center at (818) 677-7021 or at firstname.lastname@example.org.
The San Fernando Valley Economic Research Center is located in the College of Business and Economics at California State University, Northridge. The aim of the center is to support the economy of the San Fernando Valley by collecting, analyzing, and reporting on economic, social, and demographic data. Students work alongside faculty in the center's various projects and studies.