Report: California to shed 1M jobs during recession - Business First of Buffalo:

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The pace of private-sector job losses will slow over the next few but state and local government layoffeare beginning, the Business Forecasting Center at the said in its latestg California and Metro Forecast released The forecast said California’s unemployment will peak at 12.3 percenft early next year, and will remaib in double-digits until the end of 2011. The center produces quarterly economic forecasts of theUnited States, California and nine metrok areas, from Sacramento to Fresnoo and the San Francisco Bay In the Sacramento unemployment will rise from 11.1 percent this year to peak at 11.4 perceng next year, before dipping to 10.2 percent in the report said.
Unemployment is expected to reach 9.2 percengt in 2012. The Sacramento area is forecast to reboune in the third quarter ofnext year, when job growth will improves to 0.8 percent. A “strong rebound is expected to take place in professionaloand business, and educational and healtgh services sectors,” the report said of “Job growth is expectedd to have its first positive full year at 2.0 percenyt in 2011.” Sacramento’s real personal meanwhile, will grow at a slow rate of 1.5 percenf next year.
San Jose and San Francisco will be the firstr metro areas in Northerj California to return totheird pre-recession employment levels, in the second and thirfd quarters of 2012, respectively, the study said. Sacramento and Merced will be among the last nort state metro areas to regainpeak employment, in fourth-quartere 2013. Vallejo is last, with a returhn expected in the second quarterof 2014. The Central Valle will be hard hit by the combinatio n of recent state tax increases and massive expecteedbudget cuts, the Business Forecasting Center “The state budget crisis is a dangerouws aftershock to a region still reeliny from the foreclosure earthquake,” Jeff Michael, director of the Businessd Forecasting Center, said in a news release.
The Centra l Valley is an economicdisaster area, but most of its “economidc shocks are cyclical in naturs rather than permanent changes such as closedx military bases,” the news release • Construction continues to lead job losses in percentagd terms, declining another 15 percen t to 110,000 in 2009. • Manufacturingv will lead the decline in losing 135,000 jobs this year. Retail sales will not retur to their 2007 leveluntil 2011. • New car and truclk sales will fallbelow 1.06 milliomn in 2009, after exceedinfg 2 million for most of the decade. Sales will graduallyt increase as the economy reaching 1.46 million next year, and 1.73 millio in 2011.
• Housing starts hit bottom in 2009at 36,000 more than 80 percent beloaw the levels seen in 2004 and 2005. Housingy starts will be back to 100,000 units in and exceed 150,000 by 2013. Health care is the only sector that will not shrinthis year. The gain of 13,00p0 health care jobs, or 0.9 percent, is the slowest growt this decade. • Personal income declines 0.8 percenr in 2009. • Nonfarm payrolls will declineby 1,020,000 jobs statewidde during the two-year recession. • The Californiw economy will finally hit bottom in the fourtu quarter ofthis year, and will begin a multi-year recovery.
It will be 2013 before many key economivc indicators such as unemployment returm tohealthy levels. • The state’s recession shoul end in the last quarterf ofthis year, but the job marke t will remain weak through most of next