By Allison Bruce

Thursday, February 3, 2011

Ventura County should see job growth and improvement in the housing market this year, but the recovery momentum that started at the end of last year will be tempered, according to an economic forecast presented to business and government leaders Thursday.

The county's unemployment rate will likely remain above 7 percent until 2015, according to the 2011 Ventura County Real Estate & Economic Outlook conference at the Hyatt Westlake Plaza in Westlake Village.

"It's a slow healing process from a very traumatic recession," said Mark Schniepp, director of the California Economic Forecast, which offers the look at national, state and local trends for the year.

The fourth quarter of 2010 had positive trends, including job creation, rising home sales, stabilizing home prices, improvements in commercial real estate and better-than-expected holiday retail sales.

"You can see where the engines of growth are in California right now," Schniepp said, "but there's still a big problem."

He cautioned that the state's budget deficit would result in cuts that would affect state and local government workers, pushing up unemployment.

There's also the demographic challenge of a large number of young workers graduating from high school and college, which pushes the unemployment rate higher — something that is happening locally as well as nationally.

In his talk on the U.S. economy and markets, titled "The Good, the Bad and the Ugly," James Goldberg of Goldberg Investment Advisors talked about the good news that people are buying again, with spending up, but debt down, which is good news for the economy.

Of course, "for every sunny day, we have to have a little rain," Goldberg said.

"The good news is for the 83 percent of us that are working," he told the crowd of more than 150. For those without work or who are underemployed, things are still not good, he said.

While the county's unemployment will remain high in 2011 — forecast to average 9.8 percent for the year — it will decline as firms hire to increase sales and profitability, according to the forecast, which calls for a "more sustained level of job creation" by this summer.

The forecast estimates Ventura County will add 2,100 jobs in 2011, with the modest job growth holding steady versus the "fits and starts" seen with job creation in 2010. The second half of the year is expected to be better than the first half and 2012 is expected to be even better.

Jobs are expected to grow in farm work, manufacturing, transportation, professional services, leisure, education and health services and financial activities.

Schniepp told the attendees that job growth remains a central part of any improvement in the economy, particularly in housing.

"The job market didn't come back (in 2010) and we need the job market to come back for a housing recovery to become an expansion," Schniepp said.

Last year's forecast called for housing gains by the end of 2010, but it didn't happen as rising home sales and median home prices stalled.

Schniepp said an increased number of conventional sales and fewer sales of "distressed" properties — such as those in foreclosure or in short sales to avoid foreclosure — should bring a rise in home prices in 2011, though not by much, he said.

foreclosures remain an unknown that could affect the housing market.

Goldberg said it would take a couple years to work out the national problem of home prices, which tumbled 30 percent nationally and has come back only 1 percent."That's not good," he said, "not disastrous, but not good."

Attendees said they appreciated the insight from the forecast and weren't surprised that it would be a slow turnaround for the county, state and nation.

"It was very informative and encouraging," said Richard Bryan with Oxnard's Community Development Department. "It reinforced some thoughts I had ... Things are improving and that's good."