LOS ANGELES, Calif.–Southern California’s economy appears to making a mid-year comeback, but unemployment is likely to remain relatively high through next year, according to a report released today by the Los Angeles County Economic Development Corp.
“Southern California is in the midst of a real growth period led by industries such as high tech, international trade, tourism and entertainment,” according to chief LAEDC economist Nancy Sidhu.
“Though constraints are still influencing some sectors, Los Angeles County’s economy is seeing modest improvement in 2011 and should do even better in 2012. The path to recovery seems to be paved in front of us.”
The report notes that the statewide economy appears to be on the rise, with some minor growth in employment. However, the unemployment rate in Los Angeles County averaged 12.6 percent last year and will likely drop to only 12.2 percent by year’s end, according to the report.
Next year, the unemployment rate will drop again, but only to about 11.5 percent, with businesses remaining cautious about hiring until they are confident that the economic recovery is gaining traction, the study’s authors found.
“There are plenty of headwinds and uncertainty in the markets right now,” according to Perry Wong, senior economist for Los Angeles-based City National Bank. “The government must minimize the political risk of a dragged-on debt ceiling debate because it has the potential of derailing any current economic recovery.”
The report also noted that the value of two-way international trade through the Los Angeles Customs District grew by 22.6 percent last year, and is expected to increase by 6.7 percent this year and 4.6 percent next year.
