Economists hopeful Southern California can avoid recession
Many of the region’s top economists are optimistic that Southern California can avoid a recession, as strong labor markets, lower inflation and increased federal investment in critical sectors such as green technology create short- and long-term opportunities.
According to the latest quarterly update from the Southern California Association of Governments (SCAG) Economic Roundtable, earlier fears of recession have softened as general economic conditions have improved. The Roundtable is a consortium of regional economic experts that meet every quarter to update the region’s economic outlook and discuss challenges and opportunities facing the six counties that comprise SCAG.
“Although a recession had been considered likely for the third quarter this year, the Roundtable was generally optimistic that a recession will be averted or will be mild, especially in California,” the Roundtable reported from its July meeting.
Other topline results:
Southern California’s economic resiliency is driven by strong labor markets. However, the region is facing a number of labor disputes in regionally significant industries.
Commercial real estate is a weak spot in the region’s economy and housing continues to be soft, largely due to high interest rates and low supply.
Federal spending through the Inflation Reduction Act is ramping up and presents significant opportunities and multiplier effects for the region, especially surrounding green technology. Lithium mining is an emerging opportunity in Imperial County with commercial grade production possible by 2025.
Members of the Roundtable are selected for three-year terms and have expertise in the economics of SCAG’s six counties, workforce development, equity, and sustainability. Members are:
Imperial County, Michael Bracken, Development Management Group, Inc. (DMG)
Los Angeles County, Shannon Sedgwick, Los Angeles County Economic Development Corporation (LAEDC)
Orange County, Wallace Walrod, Tech Coast Consulting Group (TCCG) and Orange County Business Council (OCBC)
Riverside & San Bernardino Counties, Manfred Keil, Inland Empire Economic Partnership (IEEP) and Claremont McKenna College
Ventura County and the SCAG Region, Mark Schniepp, California Economic Forecast (CEF)
Equity, Karthick Ramakrishnan, University of California, Riverside (UCR) and California 100
Sustainability, David Roland-Holst, Berkeley Economic Advising & Research (BEAR) and University of California, Berkeley
Workforce Development, Shaun Fernando, Guidehouse Consulting