California’s 2011 recovery dismal
March 9, 2011
Economists are predicting that California’s job market recovery will be more sluggish then original estimates, according to a recent UCLA report. [LATimes]
The unemployment rate will remain in double digits until early 2013, the report says. California’s unemployment rate was at 12.4 percent in January, a month the state added only 12,500 jobs while 2.2 million Californians remained unemployed.
Rising gas and commodity prices have made employers reluctant to hire.
On the positive side, the report predicted that after California gains momentum, it will grow faster than other parts of the nation partially because of exports to Asia.
The economists point out that California may be losing out to states with less stringent environmental and other regulations. They suggest the removal of obstacles that slow growth and a focus on the state’s strengths.
“Policies which chase after smokestack manufacturing are likely to be relatively ineffective,” said Jerry Nickelsburg, a UCLA economist, to the Los Angeles Times. “Whereas policies which enhance the business climate for those sectors which California has a comparative advantage in — innovation, technology, entrepreneurship and trade — are likely to be the most efficient.”