Watkins warns of shrinking Ventura County work force
Bill Watkins’ usually dour outlook for California and the local economy is only getting gloomier.
The chief economist at California Lutheran University’s Center for Economic Research and Forecasting said March 29 that his outlook a year ago — already pessimistic compared to that of his fellow forecasters — was “wrong, way wrong.”
Ventura County lost 500 net jobs last year, from February 2011 to February 2012, he said, missing his previous estimate that the county would see some job growth in each quarter of 2011. And job losses were generally in relatively well-paying sectors, while gains tended to be concentrated in relatively lower-paid jobs, he said.
“At this point, one has to wonder where Ventura County growth, if there is to be any, will come from,” Watkins said in the written forecast that accompanied the event.
Even expecting the county’s unemployment rate to dip to 9.1 percent by the fourth quarter of this year, down from 9.6 percent in the fourth quarter of 2012, Watkins said the county’s labor force is expected to shrink. Data release by his team predicts the county’s total non-farm work force will fall to 273,000 jobs by the end of this year, compared to 275,300 at the end of 2011.
Watkins’ forecast said the fact that the county’s joblessness rate has been declining even as it lost jobs is “alarming.”
The labor force could be declining as a large number of people, discouraged by a fruitless job hunt, drop out of the work force completely. Watkins also said that many young people are leaving the county to look for job prospects elsewhere.
“Whats really slowing us down from a more rigorous recovery is the choices we’ve made,” he said, referring to tight regulations and slow-growth policies in the state.
Santa Barbara-based economist Mark Schniepp had a different take. He said the county’s labor force is not shrinking but rather is at “at an all-time high.”
Schniepp, the director of the California Economic Forecast, told event attendees that Ventura County’s unemployment rate is dropping, he said, which means that jobs are being created somewhere. Technology, logistics and professional and scientific services hold the most promise for the county, he said.
Schniepp said conflicting employment numbers are being reported by the state and explain some of the differences between his forecast and Watkins.’ Some reports rely on surveys of households, while others look at actual job numbers reported by companies, which does not account for self-employed workers.
According to data released by Watkins’ team, Ventura County’s education and health care sectors lost 2,300 jobs over the past year, while durable manufacturing lost 1,100 jobs. A few sectors showed bright spots. The wholesale trade sector gained 900 jobs, while leisure and hospitality added 800 jobs. The county’s relatively small transportation, warehousing and utility sector created 600 new jobs — an 11.3 percent gain.
Ventura County has traditionally relied on Amgen, the world’s largest biotech company and the Tri-Counties’ largest private-sector employer, to lead job growth. But the company has been cutting jobs at its headquarters as it shifts its focus. Naval Base Ventura County and the Port of Hueneme, also large employers in the county, likely won’t be adding significant numbers of jobs in coming years, Watkins said.
Ventura County has 25,200 fewer jobs currently than it had in October 2007, according to data compiled by economist Dan Hamilton with the Center for Economic Research and Forecasting.
About 8,500 of those lost jobs were in construction, 7,300 were in manufacturing, 1,900 were in retail, 3,800 were in professional and business services, and 1,500 were in personal, repair and maintenance services.
Ventura County, with 1.9 percent of the state’s non-farm jobs, has been responsible for 2.3 percent of the state’s job losses since late 2007, according to his data.
California not creating ‘fair share’ of jobs
Ventura County’s subpar performance tracks that of the state. The U.S. economy, meanwhile, is gaining steam.
California’s onerous regulatory environment is holding the state back, Watkins said. “We have a big bureaucracy that’s robbing talent from the private sector and slowing it down.”
While the Golden State is expected to see moderate economic and job growth over the next few years, it will continue to lag the nation as a whole, and most of its job gains will be clustered around the San Francisco Bay Area’s burgeoning technology sector, which is at an all-time employment high.
Southern California’s job market, meanwhile, is declining, Watkins said. That impacts Ventura County, because thousands of people from the county commute into Los Angeles and the San Fernando Valley for work every day.
“California is creating less than its fair share of jobs,” as a percentage of the U.S. population, Schniepp said.
Nationally, the outlook is brighter. Economic indicators including consumer sentiment and spending, industrial production and the stock market have all been on the upswing since November, painting a rosier picture for the U.S. recovery.
Unseasonably warm weather on the East Coast and the upper Midwest have also been contributing factors as more people get out and about and spend money, he said. U.S. exports are gaining steam as well.
All these factors have contributed to the U.S. unemployed rate steadily declining to 8.3 percent over the last year.