From the Daily Pilot
By Sarah Peters
The economy will continue to show signs of recovery with a modest increase in home values through 2011 despite continued increases in joblessness, and Orange County could lose as many as 18,000 more jobs this year, Chapman University experts said Thursday.
At their economic forecast update in Costa Mesa, professional econometric analysts Jim Doti and Esmael Adibi predicted a 3.2% jump in U.S. gross domestic product through 2011, up from -2.4 % in 2009.
“When a recession is in place, there is a momentum and very little that can stop that downward force,” said Doti, the Chapman University president. “The same could be said of recovery where there are positive forces. There is a lot of room in recovery and we believe that the positive forces will carry us through 2011.”
Addressing a breakfast audience of 700 at the Costa Mesa Hilton, Doti and Adibi gave their economic forecast for mid-2010 through 2011, and they validated their predictions for last year.
The economists predicted an increase in consumer spending; however job losses would be around 18,000 this year in Orange County.
“There is this mentality of ‘I survived,’” Abibi said, “That mentality brings out consumers with a pent up need to satisfy their spending.”
Abibi advised not to focus on the unemployment rate because in actuality, a modest increase in unemployment is a natural trend in recovery.
What happens, he explained, is that the labor force shrinks when the economy is bad because discouraged workers leave the work force and go back to school. When the economy begins to stabilize, those same workers begin looking for jobs, causing an increase in unemployment and sending a false signal that the recovery is weakening.
The good news, however, is that Orange County will see 21,000 new jobs by the end of 2011, Abibi said.