Northern California:

With Wildfire Recovery in Swing, Continued Steady Economic Growth Projected

The greater “North State” economy of Sonoma, Butte, Glenn, Tehama and Shasta counties is still recovering from wildfires of recent years. But the region’s growth isn’t revealing any major slowdown as 2020 and 2021 show potential for continued, steady expansion in employment.

That’s according to the most recent forecast presented by Cal State Chico’s Center for Economic Development. The keynote speakers’ opinions spotlight intriguing viewpoints, trends and projections so your credit union can plan appropriately.

Northern California
Presented on Jan. 9 during the 20th annual North State Economic Forecast Conference, entitled “Housing for the North State's Future — Exploring Pathways to Meet the Needs of Workforce, Education and Economic Development":

Northern California employers and jobs have not fled the broader region en masse since the destructive wildfires ravaged certain communities over the past few years. There has been a painful adjustment, no doubt. However, each county is — and will continue — experiencing its own dynamics related to local job growth. Lately, growth in services-producing industries/businesses has downshifted while goods-producing (various manufacturing) has been shifting higher (annual growth in both areas has risen and fallen over the past 10 years). The government job sector remains very flat, showing only minor growth.

Local Northern California workforce development and business leaders remain on the alert regarding a recession in the future. Although the local economy shows no signs of slowing, enough risks are playing out at the state and national levels to provide caution. The situation is a bit “delicate” even though local businesses and consumers (as well as statewide) could very well carry economic growth into late 2021, assisted by continued low unemployment and steady consumer spending. Most importantly, local leaders would do well to foster community spirit across all economic and leadership sectors (private, public and non-profit) to help keep the North State region’s economic growth afloat, if not progress higher.

Recent homebuilding in Northern California, even at a small pace, has been a major indicator of community resilience and recovery post-wildfires. However, housing issues (affordability and inventory) persist to this day. Local rental prices have surged while home price growth has moderated but continued its overall run higher. Some out-migration of residents has impacted local businesses to a degree, both on the workforce and consumer side. Home rebuilding of destroyed lots (or in new areas) is not only replacing housing units destroyed but also keeping up with local buyer interest, yet at a slow pace. It seems most of the local workforce population will remain in the North State region instead of migrating out post-wildfires, although time will ultimately tell. There are still many questions to be answered over the long term.

For more Northern California economic trends and predictions: click here. You’ll find housing, workforce, economic, and other trends on presentation slide pages 8 – 25. Additionally, click here to view the entire archived video of the forecast conference, including keynote presenter Dr. Robert Eyler (economist at Sonoma State University) and several local expert panels on housing and workforce issues.

Local Home Affordability Vs. Job Growth
The National Association of Realtors recently released a study (“Home Affordability Index Ranking and Payroll Job Growth") showing trends in how local housing affordability can contribute to slower local job growth by employers. View the data table for local metropolitan information in California and Nevada.

Local County-Level Perspectives 
The California Department of Transportation (Caltrans) has released its updated 2019 – 2050 demographic forecast sometime in late 2019 for all counties in California regarding local jobs, wages, home prices, population, personal income, taxable sales, net migration, wildfire issues, public policy implications, legal cannabis, industries, workforce, and more.

For forecasting purposes, the shorter-term economic projections for 2019 – 2024 within this annual county-wide report by Caltrans do not factor in an economic recession into its local scenarios. They are only highlights stemming from a baseline projection (view the report above for more information).

N. Central Valley Occupational/Industry Trends
Additionally, download Chmura Economics and Analytics’ latest Northern Central Valley Economic Overview to see 10-year future trends in worker occupations, employment, wages, cost of living, and industries.

Your Local Region’s GDP: 2001 - 2018
The U.S. Bureau of Economic Analysis has released an overview and history on "Local Area Gross Domestic Product from 2001 - 2018" for individual counties in California, Nevada and the entire nation. It includes highlights and trend breakdowns for large, medium and small-population size counties, as well as the U.S. dollar size of economies for each county. Tables and files are included for download and review.

Latest CA Population and Demographic Trends
The California Department of Finance has released its latest news — "State's Population Increases by 141,300 While Rate of Growth Continues to Decline" regarding 2018 to 2019 population growth, which includes highlights and snapshot trends of each county and region across the state. (You can also download the long-term 2010 to 2019 demographic tables by clicking here)

Also, the department's deeper demographic breakdown (age, race, income, employment, poverty, health care, education, and social/housing characteristics), courtesy of the American Community Survey by the U.S. Census Bureau, can be found by clicking here.

County Income and Poverty Estimates
The U.S. Census Bureau has released its "Small Area Income and Poverty Estimates (SAIPE) Program", which gives single-year estimates of income and poverty for all counties in California, Nevada and the entire nation — as well as estimates of school-age children in poverty for all 13,000-plus school districts.

Demographic Profile and Projections: Northern California (4 counties)*

  • *(Combined counties of Butte, Glenn, Tehama, and Shasta)
  • Total population: 510,000 (and will hit 521,000 by 2025).
  • Working-age individuals (15 - 64 years old): 64 percent of total population in 2015 (and will fall to 61 percent by 2025).
  • Labor force (at least 16 years old who are working/looking for a job): 217,000 out of 402,000 adult population.
  • Labor force participation rate (adults who “want” to work): 54 percent (or 217,000 individuals).
  • Unemployment rate: 4.5 percent (versus 3.9 in CA and 3.5 in U.S.)
  • Unemployed workers: 8,800.
  • Median household income: $45,600 as of 2019 (compared to $71,800 for CA and $60,400 for U.S.)
  • Poverty rate: 20 percent (versus 15 in CA and 13 in U.S.)
  • Education of population: 19 percent have a college degree; 38 percent some college; 28 percent high school diploma; and 15 percent no high school diploma.
  • Employment sector growth: click the following links for local future growth breakdowns (2014 – 2024) of nonfarm job projections by industry, occupation, education, and fastest-versus-largest areas of importance: Butte County-Chico region; Glenn-Colusa-Tehama region; and Shasta County.
  • ** Data as of December 2018 from the California Center for Jobs and the Economy; California Employment Development Department; California Department of Finance; Federal Reserve Bank of St. Louis; U.S. Bureau of Economic Analysis; and U.S. Census Bureau

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