Riverside County is regaining some of the economic vitality that existed before the housing bubble burst a few years ago, but there's a way to go before growth returns to pre-2008 levels, a pair of economists told the Board of Supervisors today.
"We have some good news to report this time,'' Cal State Fullerton professor Mira Farka said ahead of the presentation that she and colleague Adrian Fleissig gave to the supervisors.
The two, research associates at the university's Department of Economics, have been hired by the county Executive Office over the past four years to provide annual assessments of the regional, state and national economies.
Most of their previous forecasts were downbeat, but the outlook was brighter today.
"We're coming here with tempered optimism,'' Farka said. "The reason why? No one outside of Washington, D.C., is waiting for the feds to fix the economy. It's being transformed and reinvigorated by the private sector.''
According to the professor, changes taking place nationally and in California are having a ripple effect, adding to Riverside County's economic strength.
Farka said increased business investment in software and equipment, increased home construction and auto sales are pushing up the nation's gross domestic product, or GDP, which is expected to come in around 1.9 percent this year -- below the 3 percent annual growth economists generally agree defines an expansion.
"It's below average, but is nonetheless very good news for the national economy,'' she said.
The professor told the board that Europe's recession, a slowdown in Far East economic activity, as well as the United States' own $16 trillion debt load, could weigh on the nation's fiscal health. She also expressed worry that the Federal Reserve Bank would trigger a downturn when it begins hiking interest rates, probably in 2015.
Fleissig focused exclusively on regional activity during his half of the presentation. The professor said he was most impressed by how much the county unemployment rate had fallen over the last year, going from 12.5 percent to 10.5 percent as of March.
Fleissig predicted the rate would fall to about 10 percent before year-end but would continue its down-trend, eventually bottoming out at 6.7 percent in 2017.
According to the economist, the regional economy is beginning to hum again, and Riverside County "is obviously a beneficiary.''
He foresaw ongoing improvements in the housing market, fueling growth in property tax receipts -- county government's largest source of discretionary income, which has dropped 25 percent from 2008 levels.
Fleissig estimated property tax revenue growth of 3.2 percent next year, 4.5 percent in 2015 and 7.1 percent by 2018.
Supervisor Jeff Stone questioned the figures, saying he was unconvinced the region's growth would hold because the state of California "is not business friendly,'' and as more businesses leave, so do the jobs and potential tax base.
"There's been a significant flight of entrepreneurs,'' said Stone, a business owner and real estate investor. "We're not going to get back to 6.7 percent unemployment.''