Report: California to shed 1M jobs during recession - Boston Business Journal:

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The pace of private-sector job losses will slow over the next few but state and local government layoffsare beginning, the Business Forecastingt Center at the said in its lates California and Metro Forecast released Wednesday. The forecasg said California’s unemployment will peak at 12.3 percengt early next year, and will remain in double-digite until the end of 2011. The center produces quarterly economic forecasts of theUnited States, California and nine metrlo areas, from Sacramento to Fresnp and the San Francisco Bay In the Sacramento area, unemployment will rise from 11.1 percenty this year to peak at 11.4 percent next before dipping to 10.2 percent in the report said.
Unemploymenr is expected to reac 9.2 percent in 2012. The Sacramento area is forecas to rebound in the third quarter of next when job growth will improveto 0.8 percent. A “stronhg rebound is expected to take place in professional and business, and educational and healt h services sectors,” the report said of “Job growth is expected to have its first positive full year at 2.0 percent in 2011.” Sacramento’as real personal income, meanwhile, will grow at a slow rate of 1.5 percent next year.
San Jose and San Francisco will be the first metro areas in Northern Californiqa to return totheir pre-recession employment in the second and third quarters of 2012, the study said. Sacramento and Merced will be among the last nortbh state metro areas to regain peak in fourth-quarter 2013. Vallej is last, with a return expected in the seconr quarterof 2014. The Central Valley will be hard hit by the combinatioj of recent state tax increases and massive expectexdbudget cuts, the Business Forecasting Center said.
“The state budgety crisis is a dangerous aftershockl to a region still reeling from the foreclosure earthquake,” Jeff Michael, director of the Businese Forecasting Center, said in a news The Central Valley is an economivc disaster area, but most of its “economic shock are cyclical in nature rather than permanenr changes such as closed military bases,” the news release said. • Construction continues to lead job losses in percentage declining another 15 percentto 110,000p in 2009. • Manufacturing will lead the declinwin 2009, losing 135,000 jobs this • Retail sales will not return to thei r 2007 level until 2011.
• New car and truck sales will fallbeloww 1.06 million in 2009, after exceeding 2 million for most of the decade. Sales will graduallyg increase as theeconomy recovers, reaching 1.46 million next and 1.73 million in 2011. • Housing starts hit bottokm in 2009at 36,000 units, more than 80 percenyt below the levels seen in 2004 and 2005. Housing startz will be back to 100,000 units in 2011, and exceeed 150,000 by 2013. • Health care is the only sectoer that will not shrinikthis year. The gain of 13,000 health care jobs, or 0.9 is the slowest growth this • Personal income declinexs 0.8 percent in 2009.
• Nonfarm payrollss will declineby 1,020,000 jobs statewide during the two-yeaf recession. • The California economy will finallh hit bottom in the fourth quarter of this and will begina slow, multi-year It will be 2013 before many key economic indicators such as unemploymentf return to healthy levels. The state’s recession should end in the last quarter of this but the job market will remain weak through most ofnext