RIVERSIDE (CNS) - The Inland Empire economy has gained more than double the number of jobs that were lost in the Great Recession, outpacing growth in neighboring metropolitan areas, with all indications that the regional economy will continue to expand through 2019, according to a report released today by the UC Riverside Center for Economic Forecasting.
“The progress the Inland Empire economy has made over the past couple of years is the latest phase in a years-long growth wave that has included broad-based employment gains across most industries, higher income and more local spending, rising home prices, and, as of late, increased construction activity,” said Robert Kleinhenz, executive director of research for the center. “But growth is going to moderate in the relatively near future as a limited supply of workers will put a check on the region's expansion.”
Kleinhenz and center Director Chris Thornberg, both attached to the UC Riverside School of Business, were slated to detail their ninth annual “2018 Inland Empire Economic Forecast” during a conference this morning for business, industry and government officials at the Fox Performing Arts Center in downtown Riverside.
One of the key findings in the report: the Inland Empire has added more than 350,000 jobs over the last nine years -- after losing 150,000 during the Great Recession, which technically ended in the summer of 2009, though the repercussions lasted longer.
Thornberg said that the job growth in Riverside and San Bernardino counties has not been surprising, given that the inland region took a steep hit during the recession and had the capacity for a major rebound, and it continues to enjoy an “affordability advantage” that the Los Angeles, Orange and San Diego metro areas cannot match.
The IE has an employment base that is 16 percent larger than at the start of the Great Recession, according to Thornberg. By comparison, San Diego County's is 11 percent larger, while L.A.'s is 5.6 percent bigger, and Orange County's is 6.6 percent greater.
According to the report, the logistics industry, which includes trucking and warehousing, has recorded the greatest expansion, almost doubling in size over the last decade.
Construction, healthcare services and retail trade are catching up, the report stated, noting that non-farm employment is likely to grow 2.5 percent to 3 percent over the next 12 months, pushing the unemployment rate to historic lows of under 4 percent.
However, there are potential pitfalls ahead that could stall growth and put a dampener on the economy, but to what extent remains unknown, according to the report.
“Although there are longer term threats to the economy that stem from labor shortages, federal trade policies and our hugely expanded national debt, growth is expected to continue through the next year at the local, state and national level,” Thornberg said.
He said real estate prices and housing availability could be a drag on the state economy as a whole, affecting the IE over the next several years.
As of this summer, the median price of a single-family home in Riverside County was about 10 percent less than the level reached just before the economy crashed in early 2008. The median price was roughly 17 percent less in San Bernardino County, the economists said.
Lack of affordable housing will translate to a constricted labor force, meaning limited growth, they said.
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