The Valley's private sector in 2003 added more than 7,600 jobs, a 1.2 percent increase, a more optimistic sign for the future when compared to 2002, when the area's job growth performance was a meek 0.3 percent, about 2,000 jobs, or when compared to Los Angeles County's 1.3 percent private-sector job loss last year, the report said.

"The San Fernando Valley economy is on a solid growth path. All of the local indicators point to continued expansion of Valley jobs and payrolls," said Daniel Blake, director of CSUN's San Fernando Valley Economic Research Center. "On the other hand, traffic is still bad."

Valley industries with strong job growth in 2003 included finance, insurance and real estate, with a 5.5 percent increase; arts, entertainment and recreation with a 4.7 percent increase; accommodations and food services with a 4.4 percent increase; and those areas with professional, scientific and skilled workers, which experienced a 3.3 percent increase.

Industries experiencing weaker employment performances were manufacturing, which suffered a 4.2 percent drop; transportation and warehousing, which dropped by 3.3 percent; construction, which dropped by 0.9 percent; and information, which dropped by 0.8 percent.

Consistent with the impressive job growth, Blake pointed out that the Valley's unemployment claims reversed their recession-induced climb to descend sharply in the first half of 2004.

"This 2004 descent even defied the Valley's normally strong seasonal pattern of rising unemployment claims in the first half of the year," he said.

The center released its annual report on the state of the San Fernando Valley economy today at the 16th annual Valley Industry and Commerce Association Forecast Conference.

Each year, researchers at Northridge's San Fernando Valley Economic Research Center take a comprehensive look at what is happening the Valley--an area roughly bound 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.

Among their findings:

• Commercial vacancy rates continued their drop after their recessionary run up, despite the continued climb in the national rate. The Valley's second quarter 2004 rate of 11.2 percent compared favorably with the national rate of 16.8 percent. The Valley's industrial vacancy rate continued to hover around the 3 percent level, consistent with the very tight industrial space market in Los Angeles, but about one-third of the national rate.

• Total construction permit values rose dramatically, especially in the first and second quarters of 2004. Accelerating residential permit activity drove the increase in the overall value, while non-residential activity remained largely stable. New construction dominated the increase in residential permit activity even though residential alterations and additions have contributed to the increase.

• Home prices continued their steep ascent with median prices rising to $490,000 in June 2004. The home buying frenzy pushed the Valley's inventory to a record low of a one-month supply in March 2004. However, signs of changing housing market conditions abound, including the inventory level doubling to a two-month supply by June 2004. Both notices of defaults and foreclosures continued to fall as the upward spiral in home prices conferred more equity on homeowners.

  Apartment vacancy rates in the Valley remained stuck below 3 percent, signaling an ongoing tight rental market. In response, average rents in large complexes rose 5 percent in 2003, but there are early signs of slowing in that area too, as the last four quarters produced only a 4.3 percent increase in rents.

• Recent Valley tourism and travel activity has been mixed. Airport passenger traffic returned to its pre-9/11 levels at Bob Hope Airport in Burbank, and air cargo volume continues to grow. Hotel occupancy rates are climbing back toward their pre-9/11 average, but real room rates (adjusted for inflation) remain about 15 percent below their pre-9/11 levels.

• Enrollment in Valley public schools decreased slightly (down 0.1 percent) last year after growing by 4.5 percent in 2002-2003. Enrollment at Los Angeles Unified School District Valley schools and enrollment in the Glendale Unified School District decreased by 1 percent while Burbank and Las Virgenes school districts increased. Valley private school enrollment dropped 1.6 percent last year. All Valley public school districts improved their performance on the Academic Performance Index (API).

• Some quality of life measures showed improvement, and others did not. Annual air quality statistics continued to improve by most measures, but recently ozone levels crept up in 2002 and 2003. Early indicators have ozone levels returning to lower levels in 2004. Crime rates generally eased in 2003 for most Valley cities and areas. Transportation surveys show that 74 percent of the Valley workers commute alone in a car, truck or van, while the other 26 percent use more environmentally friendly means, including 5 percent who work at home. Freeway traffic congestion did not improve last year.

For a copy of the report, contact CSUN's San Fernando Valley Economic Research Center at (818) 677-7021 or at sfverc@csun.edu.