<img height="1" width="1" style="display:none" src="https://www.facebook.com/tr?id=192888919167017&amp;ev=PageView&amp;noscript=1">
Friday, March 29, 2024
March 29, 2024

Linkedin Pinterest

Forecast: Unemployment likely to remain high

The Columbian
Published: January 24, 2010, 12:00am

Last year, I guessed that Clark County would have a substantial job loss — the largest job loss since 1982. And I wrote, “I hope I’m wrong.” Now I wish I had been right, since I pegged the loss at only 1,500 jobs.

Instead, employment in the county has dropped by 5,900 jobs in the past 12 months, and 8,900 jobs since the downturn hit locally in February 2008.

o With credit tight, small businesses will have trouble finding funds for expansion.

o Clark County employment (likely) will remain largely unchanged in 2010.

o Health and education services added about 600 jobs in both 2008 and 2009, the one bright spot in the labor market. Look for a slightly smaller expansion in 2010.

In 2010, I expect both the national and local economies to stagnate. Nationally, it would not be surprising to see Gross Domestic Product output turn negative again by the end of the year, as the impact of federal stimulus programs wear off and inventory adjustments taper off. Other factors that could have an impact:

o With credit tight, small businesses will have trouble finding funds for expansion.

o Clark County employment (likely) will remain largely unchanged in 2010.

o Health and education services added about 600 jobs in both 2008 and 2009, the one bright spot in the labor market. Look for a slightly smaller expansion in 2010.

• Credit markets have been badly damaged, and remain weak.

As was pointed out at the Columbia River Development Council annual meeting in November, local banks will be happy to accept your deposits, but they won’t be doing much in the way of lending. Balance sheets will continue to be hit by the troubled commercial real estate market. With credit tight, small businesses will have trouble finding funds for expansion.

• The housing market will continue to experience high levels of foreclosures.

The pipeline of foreclosed properties will keep prices low and demand for new housing at a minimum.

In addition, with slow population growth and weak incomes, there will be little in the way of new household formation, further holding down demand.

• Consumer spending will continue to be hampered by unemployment and under-employment, little in the way of wage growth, and tight credit.

I am guessing that total Clark County employment will remain largely unchanged in 2010. Slow hiring will translate into a stubbornly high unemployment rate, which in 2009 topped out over 13 percent of the total work force. Local unemployment was higher than statewide averages of more than 9 percent and a national average of 10 percent.

Construction and manufacturing, two of the big job losers during the recession, have likely hit bottom, but show little upside potential in terms of hiring, barring a second stimulus bill from Congress.

Retail trade in Clark County, which lost 7.4 percent of its employment base, or 1,200 jobs, in 2009, could slide further as consumer spending remains weak. The same holds true for accommodations and food services, which declined by 4 percent, 400 jobs, in 2009.

The one bright spot in the labor market was health and education services, which added about 600 jobs in both 2008 and 2009. Look for a slightly smaller expansion in 2010.

Government agencies cut 100 jobs in 2009, and appear to be poised to cut more in 2010. The exception will be hiring for the U.S. Census, which will temporarily boost federal employment.

Loading...