Signs are increasing that an economic turnaround has begun in Southern California, even as residents and businesses continue to struggle in the worst downturn in decades.
The state's exports are growing as overseas consumers, especially those in Asia, are demanding computers, electronics and agricultural products from California. Tourists are starting to return to the region's hotels and beaches. And home prices appear to be stabilizing in some of the Southland's hardest-hit markets.
"All of the indicators are that the recession is over with, even in California," said Jerry Nickelsburg, senior economist at the UCLA Anderson Forecast.
UCLA's quarterly regional forecast, scheduled to be released today, comes amid rising optimism among economists nationwide. Federal Reserve Chairman Ben S. Bernanke said Tuesday that the nation had probably exited its worst downturn since the 1930s and that the economy was probably expanding once again.
"From a technical perspective, the recession is very likely over at this point," he said in remarks at the Brookings Institution, a Washington think tank.
In California, a new report by Comerica Bank showed positive trends in the state's economy in July, for a fourth straight month. Cal State Fullerton says its indicator for Southland economic growth was positive last month for the first time in nine quarters.
Economists are also optimistic about California's long-term prospects in areas such as green technology, medical research and international trade. In the short term, however, its rebound could lag behind the national recovery.
The state's unemployment rate reached 11.9% in July, well above the national rate of 9.4%. Joblessness in California will continue to rise through the end of 2009, peaking in the fourth quarter at 12.2%, according to UCLA economists, who predict that job growth won't resume until late 2010.
The state's budget woes also will be a major drag. California is spending less on healthcare, education and prisons. It's cutting jobs and furloughing workers. That means less money to stimulate the economy.
The state's recovery will also be hindered by its historic reliance on the housing industry, which created tens of thousands of jobs in construction and financial services during the boom. Now many of those positions have vanished.
