e-EDGE is now available as an RSS feed. [Click here to subscribe to it.]Recently, copies of the Los Angeles Business Journal featuring a four-page insert about L.A. County’s Strategic Plan for Economic Development, and an op-ed by LAEDC President & CEO Bill Allen calling for our state leaders to create a statewide economic development plan to guide its job creation efforts, were delivered to each and every California Assembly Member and Senator’s office.
With Legislative “Jobs Packages” being introduced almost daily in Sacramento, we at the LAEDC believe L.A. County’s Strategic Plan can serve as a model for the state’s deficient economic development efforts.
The grassroots, consensus process by which the plan was developed – engaging participants from a diverse array of sectors (e.g., labor, environment, academia, business, and other community-based organizations) – demonstrates what can be accomplished when a diverse group of stakeholders comes together to develop and, ultimately, implement a shared vision for growing the economic pie and creating jobs. This is exactly what we hope to encourage our state’s leadership to do.
Here in L.A. County, we’ve identified Champions for 3 of the 5 components of the Strategic Plan. The Champions will help shape the implementation actions and lead the movement that is rapidly forming to ensure the successful delivery of the component’s 12 objectives and 52 strategies designed to strengthen our economy, improve our environment and invigorate our communities. We've also created a website that details the planning process and the resultant movement that has begun to develop and take hold around this plan. Visit us at www.LACountyStrategicPlan.com to learn more and get involved.
The Bureau of Labor Statistics just released its latest U.S. Labor Market Report covering the U.S. employment situation in February. The overall message was similar to recent months: labor markets continued to be weak. The unemployment rate continued high, though February’s decline in employment was quite small, below -40,000 jobs, for the second consecutive month. Taken together, these are signs the long downtrend in labor markets is probably getting ready to end—and none too soon.
Looking first at the employer survey, total nonfarm employment fell by only -36,000 jobs in February, compared with revised losses of -26,000 jobs in January and -109,000 jobs in December. The average decline in January-February was below the fourth quarter average decline of -90,000 jobs, a good sign.
Government payrolls fell by -18,000 workers in February, as increases at the federal and state level were swamped by declines among local government and school districts. Job counts in the private sector dropped by -18,000 jobs, the twenty-sixth consecutive monthly decline. Four sectors reported higher payrolls in February. Business & professional services employment rose by +51,000 jobs compared with January (due almost entirely to an increase of +48,000 jobs at temporary help agencies); while private education & health care services employment grew by +32,000 workers. The leisure & hospitality sector reported an increase of +7,000 jobs; and manufacturing payrolls edged up again, this time by just +1,000 workers. The biggest payroll declines over the month were reported by: construction (-64,000 jobs, partly due to bad weather); information (-18,000 jobs); transportation & warehousing (-12,000 jobs); and financial activities (-10,000 jobs).
Compared with February 2009, nonfarm employers in the U.S. have sliced payrolls by -3,297,000 workers, a decrease of -2.5%. Private-sector employment dropped by -3,198,000 jobs, or -2.9% over this period. The only major private-sector industry group reporting higher payrolls versus last year was education & health services (+340,000 jobs). Employment has also increased in three smaller industries: temporary help employment (up by +76,200 jobs); computer systems design services (+11,900 jobs); and other information services (+400 jobs). On the downside, the construction and manufacturing sectors have shed large numbers of workers over the past year. Compared with February 2009, job counts have plunged by -880,000 jobs and -822,000 jobs respectively.
The separate BLS-sponsored survey of households also suggested that labor market conditions could be stabilizing. The U.S. unemployment rate was 9.7% last month, the same as in January and down from 10.0% in December and November. Still, joblessness remained well above the 8.2% rate of February 2009, a reminder that the recovery in labor markets has a long way to go.
Comparing the major demographic groups with February 2009, jobless rates for adult men and women have risen by +1.6 percentage points and +1.2 percentage points respectively, while the rate for teenagers jumped by +3.2 percentage points. Over the same period, the unemployment rates for whites and Asians increased by +1.3 percentage points and +1.5 percentage points respectively. Meanwhile, joblessness among black and Hispanic workers grew by +2.3 percentage points and +1.4 percentage points respectively.
Labor market conditions have deteriorated badly in this long downturn, and the damages continue to grow. In the 26 months since the recession began (in December 2007), total nonfarm employment has decreased by nearly -8.4 million workers. About two-thirds of the numerical losses came in manufacturing, construction, and professional & business services. In percentage terms, employee ranks have sustained the biggest losses in the furniture, automotive, wood products, construction and temporary help industries. Over the past 26 months, job counts have plunged by -30% in furniture and vehicle & automotive parts manufacturing; -29% in wood products manufacturing; -26% in construction; and by -22% in the temporary help industry.
Nonetheless, the February report does offer a few glimmers of hope. As business begins to pick up in the first stages of an upturn, many firms turn to temporary workers while they wait to see if the improvement is permanent. February was the 5th consecutive month with higher job counts in the temporary help industry. And the nation’s unemployment rate appears to have stopped rising, though it remains quite high. It’s still true the nation’s labor markets remain extremely troubled, but it looks like they are closing in on the bottom, which will eventually be followed by the recovery. (Nancy D. Sidhu)
PR: http://www.bls.gov/news.release/pdf/empsit.pdf
The State Employment Development Department (EDD) was supposed to release state and local employment data for January 2010 on March 5th. The release was also supposed to include revised employment data for 2008 and 2009. However, the bad weather in Washington DC (remember the snow closures) delayed processing of all the numbers, and this rolled back to slow the EDD’s work.
So this is what we know. The California unemployment rate in January was 12.5% compared with 12.3% in December 2009, and 9.7% in January 2009. The number of nonfarm jobs (seasonally adjusted) in January rose by +32,500 from December. Eight sectors recorded gains, including long suffering construction and manufacturing. Over the year, nonfarm employment fell by -701,700 jobs. As usual, increases came in (private) education and health services.
In Los Angeles County in January 2010, the seasonally adjusted unemployment rate was 12.5% compared with 12.3% in December and 9.7% in January 2009. Unadjusted nonfarm employment fell by -4.5% or -176,500 jobs to a total of 3,728,400 workers. The only major employment sectors in the County posting gains over the year were (private) education (+5,000 jobs) and health care (+5,200 jobs). EDD also noted that motion picture & sound recording added 6,400 jobs over the year.
EDD has indicated that we will get more information (industry detail and by metro area) on March 10th, so stand by. (Jack Kyser)
PR: http://www.labormarketinfo.edd.ca.gov/?pageid=1003
The long slide in outstanding consumer credit changed course in January and rose by +2.4% (after falling by -2.2% in December). The latest month’s uptick ended a run of eleven consecutive monthly declines including November’s plunge of -11.6% (revised), which was the steepest drop since the early 1980s. Revolving credit fell at an annual rate of -2.3% while non-revolving credit increased by +5.0%. By dollar volume, total consumer credit increased by $5.0 billion over the month (seasonally adjusted) after falling by -$4.6 billion in December.
Revolving debt, including balances owed on store charge accounts and bank credit cards, declined by -$1.7 billion in January (-2.3%). Over the past year, revolving debt has slumped by -9.5%, its worst year-on-year decline since recordkeeping began in 1968. A year ago, the annual growth rate was +1.1%.
Non-revolving debt, including auto loans increased by +5.0% or $6.6 billion in January. Over the past 12 months, non-revolving debt declined by -1.1%. A year ago, non-revolving debt was growing by +1.7%.
Over the past year, total consumer credit outstanding fell by -4.2% or by -$108.1 billion, the worst year-over decline in the post World War II era. Total consumer credit has fallen by -$125.3 billion from its peak in July 2008. Tighter lending standards and penny-pinching consumers continued to whittle away at credit card debt, while non-revolving credit reflected improved availability in loan terms for light vehicles. Still, until the labor market shows significant signs of improvement, consumers are likely to clamp down on discretionary expenditures as they work to rebuild their own household balance sheets and retirement saving accounts. (Kimberly Ritter)
PR: http://www.federalreserve.gov/releases/g19/Current/
Vehicle sales increased over the year in February. Total light vehicle sales last month were 10.3 million (seasonally adjusted annual rate or SAAR), up by +13.1% from February 2009, but down by -3.9% from January.
Total car sales, including both foreign and domestic models, jumped by +17.1% last month from twelve months earlier (to 5.4 million SAAR). Foreign auto sales dipped by -0.3% (to 1.9 million SAAR), while sales of domestic models shot up by +27.3% (to 3.7 million SAAR). On a month-over basis, domestic sales fell by -1.7% but still outpaced sales of foreign nameplates, which fell by -7.5%.
Combined sales for foreign and domestic light trucks were up last month, but the individual results were mixed. Over the year, total light truck sales rose by +9.0% (well up from January’s +3.8% increase) to 4.9 million vehicles. But over the month, the number of light trucks sold declined by -4.2% after falling by -2.9% in January. Domestic models continued to dominate the light truck segment. Rising by +18.1% (to 4.1 million SAAR), sales of domestic nameplates drove last month’s year-over increase as sales of foreign models plunged by -23.3% (to just 0.8 million SAAR).
Sales of medium-heavy trucks (for commercial use) remained flat in February after rising by +3.8% in January, but fell by -23.9% over the month. Last month’s year-over increase marked the second consecutive uptick in sales of medium-heavy trucks following a string of 36 (!) double digit year-over declines beginning in January 2007.
The automotive industry is off to a better start in 2010 and appears to be on the mend, at least compared with the worst of last year’s recession-plagued months. There is still a high level of uncertainty regarding the economic recovery, however. Although there are indications consumers are beginning to loosen their purse strings, the general attitude towards spending remains one of caution. It will be interesting to see where auto sales go from here with the arrival of the spring buying season and the departure of last month’s severe weather which hampered sales throughout much of the nation. (Kimberly Ritter)
PR: www.bea.gov
January total passenger traffic and air cargo reports are in from Los Angeles International Airport (LAX), Ontario International Airport, Long Beach Airport and John Wayne/Orange County Airport. Two of the four local airports (LAX and John Wayne) reported higher levels of passenger traffic compared to a year ago. Meanwhile, two of the four (Ontario and Long Beach) experienced lower air cargo tonnage compared to January 2009. San Francisco International Airport (SFO) reported an increase in both total passengers and air cargo tonnage in January compared to a year earlier. Also, Burbank Airport has published its December 2009 passenger traffic and cargo figures.
LAX total passenger counts (domestic and international) came in at 4.6 million passengers in January. Domestic passengers numbered 3.2 million and international passengers totaled 1.4 million in January. LAX experienced a rise of +8.0 percent in total passenger traffic compared to January 2009. Total air cargo tonnage was up by +24.9 percent from January 2009 to January 2010.
Ontario International Airport’s passenger traffic figures were basically flat moving down by just -0.1 percent in January over the year. Meanwhile, air cargo tonnage fell by -10.7 percent from January 2009.
Long Beach Airport’s total passenger count declined by -5.4 percent in January compared to a year ago. Total air cargo tonnage was down by +21.6 percent from January 2009 to January 2010.
The John Wayne/Orange County Airport total passenger count in January (651,224) was up by +9.9 percent relative to January 2009. Air cargo tonnage (1,383 tons) increased by +6.5 percent compared to January 2009.
San Francisco International Airport’s total passenger traffic (2,796,566) grew by +5.3 percent in January over the year. Total air cargo tonnage surged by +10.5 percent from January 2009 to January 2010.
Burbank/Bob Hope Airport’s latest results also came in. Burbank Airport’s total passenger traffic declined by -1.8 percent in December 2009 over the year and declined by -13.9 percent in calendar year 2009. Air cargo tonnage grew by +14.7 percent from December 2008 to December 2009. Total air cargo tonnage was up by +3.5 percent for the year. (Ferdinando Guerra)
PR: http://www.lawa.org/welcomelax.aspx
http://www.lawa.org/welcomeONT.aspx
http://www.ocair.com/,http://www.longbeach.gov/airport/default.asp, http://www.burbankairport.com/
http://www.flysfo.com/web/page/index.jsp
Canada: Statistics Canada announced last week that Canada’s GDP grew by +5% in the fourth quarter of 2009. This was the strongest economic growth in ten years as investment, consumer spending and trade all rebounded. Housing investment along with fixed-capital investment played a significant role in last quarter’s economic revival. In addition, increased consumption of durable goods provided some life to the economy. Finally, exports rose by nearly +4% over the quarter, with auto parts leading the way. The economic recovery in Canada ultimately depends upon the strength of the U.S. recovery, as exports represent nearly 40% of Canadian GDP and nearly 80% of those exports go to the U.S. (Ferdinando Guerra)
Tuesday, March 23, 2010: Town Hall Los Angeles: Have Any Questions About the Economy? - Janet L. Yellen, PhD, President and Chief Executive Officer, Federal Reserve Bank of San Francisco
12:00 PM Luncheon Address with Q&A. Millennium Biltmore Hotel (506 South Grand Avenue), Los Angeles. Parking: $20 Valet and $9.35 Self-Parking at Pershing Square; both require validation.
Yellen took office on June 14, 2004, as president and chief executive officer of the Twelfth District Federal Reserve Bank, at San Francisco. Yellen is a member of both the Council on Foreign Relations and the American Academy of Arts and Sciences and a research associate of the National Bureau of Economic Research. She also serves on the board of directors of the Pacific Council on International Policy, and in the recent past, she served as president of the Western Economic Association, vice president of the American Economic Association and was a Fellow of the Yale Corporation.
April 19-20, 2010: USC Marshall School of Business: Asia/Pacific Business Outlook 2010
USC - Davidson Conference Center (on Campus), 3415 S. Figueroa St., Los Angeles, CA
As the world economies slowly rebound from the financial crisis in 2010, Asian economic growth leads the globe. Learn how your firm can benefit from Asia’s surge. Now in its 23rd year, APBO is North America’s premier event for business leaders who want to expand their trade and investment in Asia/Pacific. APBO features 60 concurrent sessions on 15 Asia/Pacific economies. Build your international business network through APBO’s unprecedented access to 60 business experts with on-the-ground knowledge and experience.
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