Wednesday, March 23, 2016

Solano supervisors told local economy expanding

Solano supervisors told local economy expanding

By From page A1 | March 23, 2016
FAIRFIELD — Financial indicators across the board show the Solano County economy has essentially recovered from the 2007 downturn, and is growing.

“Folks, the news continues to be good,” Robert Eyler, president of Economic Forensics and Analytics out of Petaluma, told the Board of Supervisors on Tuesday. “We have gone from emerging from the recession to expanding.”

Eyler presented his 2015 Index of Economic & Community Progress report, highlighting increases in the number of jobs across the market landscape; increases from sales and property taxes; increases in gross and personal income per capita; and positive social indicators such as the high school graduation rate being higher and the dropout rate being lower than the state averages.

“The education data is the best that I’ve seen since doing the index,” said Eyler, who has been compiling the report for four years. He said the education numbers, as compared to the state, are the best since 2003.

Moreover, he called the report the best growth index he has ever put together.

It was equally clear, however, that those on the higher steps on the socio-economic ladder are generally benefitting from that growth more than those closer to the bottom, where wages are not keeping pace with the cost of living.

Moreover, the labor force is getting older, “choking off” job availability from younger people entering the market. That is balanced somewhat by the fact there are more people attending college.
Supervisor Linda Seifert said even lower-paying jobs are a positive because it gives people who may have been without work a place to start and rebuild – noting programs in the county that are reflecting that positive outcome.

But others pointed out that while the jobless rate may be going down, the pressures on the county to provide economic aid are on the rise.

Furthermore, broader-based employment profiles suggest the unemployment in Solano County could be closer to 10.6 percent than the 5.6 percent reported Friday by the state Economic Development Department. The same reporting puts the state jobless rate at greater than 11 percent.

Eyler, in a phone interview after the meeting, said it was difficult to pinpoint actual unemployment in the county. However, he said it would still be on the decline.

He cautioned the supervisors about artificially increasing income levels through minimum wage hikes because they act as a tax on business, which in turn must find a way to pass those costs along.

The more important message, Eyler said, is the influence of regional dynamics on the local economy – and the likelihood that tracking and adjusting to those elements will become more critical in the coming years.

As an example of the expanding regional snapshot, he noted that Solano County has more commuters leaving for their work than are coming in, calling it a double-edged sword of more money being spent locally; but traffic, the loss of skilled labor and other negative factors balance the ledger.

Another example is the construction industry. Contractors and other laborers may have taken their skills outside the county, but are bringing the paychecks home. He said there is a greater demand in the county than there appears to be supply of builders.

The presentation generated a pragmatic inquiry from Supervisor Jim Spering.

“It’s a good report, but what do we do with this report?” he asked.

Spering wanted to know how the raw data of the report can be used to develop on-the-ground policy and programs that will help the county.

“It is critical we have the information first,” said Sandy Person, president of the Solano County Economic Development Corporation, which will host its annual breakfast March 31 at the Hilton Garden Inn in Fairfield.

Eyler is the keynote speaker at the breakfast. He said he will emphasize the national and global picture of the economy at the event.

He told the board that the global economy does create “an uncertainty” that is hard to calculate.
Eyler extended the positives by noting that the growth has been slow and steady enough to offset interest rate fluctuations and fears there will be another housing downtown. He said another recession is not in the immediate forecast.

“We do not expect a recession in California, or the country, before the end of this decade,” Eyler said.