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These Trying Times : Joblessness, Credit Crunch, Lower Sales, More on Welfare

Recession In San Gabriel Valley: A Special Report

May 19, 1991|EDMUND NEWTON | TIMES STAFF WRITER

It's belt-tightening time in the San Gabriel Valley.

Rising unemployment, a credit crunch, shrinking sales receipts, swelling welfare rolls--the economic indicators have been saying "recession" for the past six months.

Signs of slowdown abound. A once-busy shoe store in Monrovia is shut down. Car salesmen in El Monte sit idly, waiting for customers. The Pomona City Council talks about layoffs to balance the municipal budget. Construction projects in Pasadena and Altadena beg for financing--sometimes long past their planned completion dates.

By some accounts, the recession of 1990-91 is a "spotty" one, dealing the San Gabriel Valley only a glancing blow.

It's as much an insidious state of mind as an assortment of fiscal ills, said Bruce Ackerman, executive vice president of the Pasadena Chamber of Commerce. "Consumers and small businesses who have no reason to tighten up, just do so out of fear," Ackerman said. "People say, 'Gee, if it's that bad out there, I better slow down.' There's a lot of that."

Added Cal Poly Pomona economics professor George Galbreath: "The San Gabriel Valley is not among the high-suffering regions."

Try telling that to Miguel Lucero.

For six months, Lucero has been scouring the San Gabriel Valley on his bicycle, looking for a work. "They take your application, but there's no work," said Lucero, 21, a warehouse worker from Baldwin Park. Now, tired and hungry, he's applying for a $312-a-month welfare check.

"I hate to have to be here," he said, surveying the packed waiting room at the Los Angeles County Public Social Services Department. "This is the bottom."

According to county records, San Gabriel Valley welfare rolls are up for all major programs, reflecting hard times in the region. Increases of almost 12% in Aid to Families with Dependent Children, which provides assistance to parents of small children, lag slightly behind the county average.

But the program for single, destitute people such as Lucero shot up by a third last year, outstripping county increases.

Advocates for the poor say the dramatic rise is a sign of the San Gabriel Valley's increasing homelessness problem. "We're getting a lot of evicted people now," said Sylvia Franco, director of El Monte's Interfaith Community Outreach. "The people coming in for cold-weather shelters this year tripled. There are a lot coming in after they've lost their jobs and their benefits have run out."

State figures show unemployment up dramatically in San Gabriel Valley cities, though only Azusa, Baldwin Park, El Monte, Pomona and Rosemead exceeded the county rate of 7.4%.

But for the local jobless, the dilemma is just as intractable as elsewhere.

In West Covina, a few miles away from the El Monte welfare center, sheet metal worker James Denton glumly filed for unemployment benefits. Denton, 41, of Hacienda Heights, has 18 years' experience shaping sheets of metal into air-conditioning and heating vents. He called the job picture "the worst it's been since '76."

Despite what agents say is a recent mini-boom in real estate sales and some signs of life on the car lots, the recession has indeed reached the San Gabriel Valley, economists say.

Though separate data for such categories as housing starts or business investment is difficult to cull for the San Gabriel Valley, sales tax revenues for the region's 29 incorporated cities present a revealing picture of the ups and downs of the economy.

Eleven of 28 cities in the region (excluding Diamond Bar, which incorporated in 1989) recorded declines in the number of dollars brought in from 1989 to 1990. Most of the rest were unable to match even last year's inflation rate of 6.1%.

Only Monrovia, Pasadena, Rosemead, Sierra Madre, South Pasadena and Walnut recorded real revenue increases, exceeding the inflation rate, figures from the State Board of Equalization show.

Preliminary taxable sales totals for the final three months of 1990, when the recession flowered, show 13 cities recording declines from the same period in 1989, according to an analysis by the accounting firm of Hinderliter, de Llamas & Associates.

The figures are of more than academic interest to the cities, which collect 1% of taxable sales within their boundaries. Sales tax revenue usually provides a major share of municipal operating budgets.

"A couple of things are going on here," said Lloyd de Llamas, a partner in the firm, which compiles sales tax revenues for 108 Southern California cities. "First, the San Gabriel Valley is becoming somewhat of a mature market. You can only absorb so many automobile retailers and shopping malls."

During the last major recession, in 1981-82, San Gabriel Valley cities were expanding, de Llamas said. "There doesn't seem to be the ability now to absorb the layoffs that there was 10 years ago," he said.

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