STOCKTON — Look for steady economic growth in California for the rest of the decade. That’s the message from University of the Pacific economists in the California and Metro Forecast released Tuesday.
This economic recovery, never a barn-burner, is settling in for the next few years, according to the study. Gross state product is expected to grow at a rate of 2.5 percent. Job growth has gone as low as it’s going to in this cycle. Unemployment is projected to stabilize between 5.5 and 6 percent through 2020.
“California has continued to add jobs at an over 2 percent pace throughout 2016, but we expect job growth will slowly recede to a 1 percent pace over the next two years,” wrote the report’s authors.
Job growth is projected to be a bit stronger in San Joaquin County, however, thanks to growth in the distribution and transportation sectors.
“Employment growth is on track for a 3.7 percent gain in 2016 and is projected to remain above 3 percent in San Joaquin County for 2017, the fastest of all Northern California metro areas,” the report said.
The California and Metro Forecast is produced quarterly by the Center for Business and Policy Research at the University of the Pacific’s Eberhardt School of Business.
Other highlights from the report:
- Health Services has become the largest employment sector in the state and is projected to add an additional 50,000 positions statewide over the next 12 months, slightly fewer than the 65,000 jobs added in the past 12 months.
- Consumers are shifting their spending from retail to restaurants. That, plus growing tourism, have fueled rapid growth in the Leisure and Hospitality sector. That sector is expected to add 30,000 new jobs over the new year, less than in the recent past. It’s projected to cool even more to 15,000 new jobs as the minimum wage increases lead to less hiring.
- Single-family housing starts is still slow. The state is projected to build just 50,000 new homes this year. Economist believe 2017 will bring a bigger increase to 77,000 homes.