Beacon EconomicsBeacon Economics | beaconecon.com
Christopher Thornberg, PhDFounding Partner, Beacon EconomicsDirector, UCR SoBA Center for Economic Forecasting and Development
Los Angeles: Then and NowNovember 2018
Beacon EconomicsBeacon Economics
A look backNBER says U.S. recession began December 2007Mon Dec 1, 12:20 pm ET WASHINGTON (Reuters) – The U.S. economy slipped into recession in December 2007, the National Bureau of Economic Research's business cycle dating committee announced on Monday.
Beacon EconomicsBeacon Economics
The Good: Strong Growth Trends
Meet the Trump economy, same as the old economy
⏤ Economy on a steady growth path since
2014-2015 global commodity bust
⏤ Labor markets, business investment,
wages, exports, energy, housing all on
good trends
⏤ 2018 better: good momentum with fiscal
stimulus after-burner
⏤ Still a low chance of recession in next 24
months`
⏤California: Still out in front
3
0.0% 20.0% 40.0% 60.0%
2023
2022
2021
2020
2019
2018
WSJ Next Recession PollIt isn’t the ‘when’, it’s the ‘why’ that matters
Beacon EconomicsBeacon Economics
The Bad and UglyBrakes and Imbalances
⏤Labor shortages impacting employers⏤Local Housing Shortages⏤Recent market volatility / rising long term rates⏤Aggressive Fed, flattening yield curves⏤Sharp growth in government deficits⏤Global trade / security worries
Politics going in the wrong direction⏤Little effort to deal with underinvestment in
infrastructure, rising wealth and income inequality, healthcare cost inflation, pension and entitlement issues, etc etc etc
⏤The great disconnect between economic realities and political discourse
4
Beacon EconomicsBeacon Economics
GDP Growth Q3: 3.5%
-4
-3
-2
-1
0
1
2
3
4
2005
Q1
Q4
Q3
Q2
2008
Q1
Q4
Q3
Q2
2011
Q1
Q4
Q3
Q2
2014
Q1
Q4
Q3
Q2
2017
Q1
Q4
Q3
Real GDP Growth (yoy)
-3.0
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
Jan-
00F
eb-0
1M
ar-0
2A
pr-0
3M
ay-0
4Ju
n-05
Jul-0
6A
ug-0
7S
ep-0
8O
ct-0
9N
ov-1
0D
ec-1
1Ja
n-13
Feb
-14
Mar
-15
Apr
-16
May
-17
Real Consumer Spending- YoY Gr
Beacon EconomicsBeacon Economics
Housing Markets: Steady
6
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
Jul-9
4Ja
n-96
Jul-9
7Ja
n-99
Jul-0
0Ja
n-02
Jul-0
3Ja
n-05
Jul-0
6Ja
n-08
Jul-0
9Ja
n-11
Jul-1
2Ja
n-14
Jul-1
5Ja
n-17
Case Shiller National HPI Y-o-Y Ch
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
12.0
Jan-
02N
ov-0
2Se
p-03
Jul-0
4M
ay-0
5M
ar-0
6Ja
n-07
Nov
-07
Sep-
08Ju
l-09
May
-10
Mar
-11
Jan-
12N
ov-1
2Se
p-13
Jul-1
4M
ay-1
5M
ar-1
6Ja
n-17
Nov
-17
Months Supply Homes For Sale (NAR)
Beacon EconomicsBeacon Economics
Pace of Construction: Over Building?
7
0
0.5
1
1.5
2
2.5
3
3.5
1969
1972
1975
1978
1981
1984
1987
1990
1993
1996
1999
2002
2005
2008
2011
2014
Housing Starts per New Household
0200400600800
100012001400160018002000
Jan-
92Ju
l-93
Jan-
95Ju
l-96
Jan-
98Ju
l-99
Jan-
01Ju
l-02
Jan-
04Ju
l-05
Jan-
07Ju
l-08
Jan-
10Ju
l-11
Jan-
13Ju
l-14
Jan-
16Ju
l-17
Sales and Starts
SF Starts SF Sales MF Starts
Beacon EconomicsBeacon Economics
Over Borrowing?
8
500
550
600
650
700
750
800
99:Q
200
:Q2
01:Q
202
:Q2
03:Q
204
:Q2
05:Q
206
:Q2
07:Q
208
:Q2
09:Q
210
:Q2
11:Q
212
:Q2
13:Q
214
:Q2
15:Q
216
:Q2
17:Q
2
Mortgage Origination by Credit Score
Median 25th percentile 10th percentile
62.0%
63.0%
64.0%
65.0%
66.0%
67.0%
68.0%
69.0%
70.0%
Q1-
85 Q
4-86
Q3-
88 Q
2-90
Q1-
92 Q
4-93
Q3-
95 Q
2-97
Q1-
99 Q
4-00
Q3-
02 Q
2-04
Q1-
06 Q
4-07
Q3-
09 Q
2-11
Q1-
13 Q
4-14
Q3-
16
Ownership Rates
Beacon EconomicsBeacon Economics
Labor Markets
9
0
500
1000
1500
2000
2500
3000
3500
2010 2011 2012 2013 2014 2015 2016 2017
Net Change Payroll Jobs
0.0
0.5
1.0
1.5
2.0
2.5
2010
-01-
0120
10-0
6-01
2010
-11-
0120
11-0
4-01
2011
-09-
0120
12-0
2-01
2012
-07-
0120
12-1
2-01
2013
-05-
0120
13-1
0-01
2014
-03-
0120
14-0
8-01
2015
-01-
0120
15-0
6-01
2015
-11-
0120
16-0
4-01
2016
-09-
0120
17-0
2-01
2017
-07-
0120
17-1
2-01
2018
-05-
01
Y-o-Y Growth Non Farm Payrolls
Beacon EconomicsBeacon Economics
Why Slowing Job Growth?
10
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
Jan-
94Ju
l-95
Jan-
97Ju
l-98
Jan-
00Ju
l-01
Jan-
03Ju
l-04
Jan-
06Ju
l-07
Jan-
09Ju
l-10
Jan-
12Ju
l-13
Jan-
15Ju
l-16
Jan-
18
US Unemployment Rate
U6
U3
1
1.5
2
2.5
3
3.5
4
4.5
Dec
-00
Jan-
02Fe
b-03
Mar
-04
Apr
-05
May
-06
Jun-
07Ju
l-08
Aug
-09
Sep
-10
Oct
-11
Nov
-12
Dec
-13
Jan-
15Fe
b-16
Mar
-17
Apr
-18
US Job Openings Rate
Beacon EconomicsBeacon Economics
Wage Gains
11
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
$45,000
1953
1957
1961
1965
1969
1973
1977
1981
1985
1989
1993
1997
2001
2005
2009
2013
2017
Real Median Income- Males
45,000
55,000
65,000
75,000
85,000
95,000
105,000
115,00019
7519
7819
8119
8419
8719
9019
9319
9619
9920
0220
0520
0820
1120
1420
17
Real Average Household Income
Census BEA
Beacon EconomicsBeacon Economics
62
64
66
68
70
72
74
76
78Life Expectancy
1973 2018
Quality of Life
Source: Countryeconomy.com. Statista. 12
0.0%
0.4%
0.8%
1.2%
1.6%
2.0%Infant Mortality
1973 2018
4.15%
2.85%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
4.0%
4.5%Crime Rate in the U. S.
1973 2016
Beacon EconomicsBeacon Economics
The Boomer Bust
13
-0.5%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
Jan-
75O
ct-7
7Ju
l-80
Apr
-83
Jan-
86O
ct-8
8Ju
l-91
Apr
-94
Jan-
97O
ct-9
9Ju
l-02
Apr
-05
Jan-
08O
ct-1
0Ju
l-13
Apr
-16
US Population 25-54 Y-o-Y Gr
-
5.0
10.0
15.0
20.0
25.0
Und
er 5
yea
rs5
to 9
yea
rs10
to 1
4 ye
ars
15 to
19
year
s20
to 2
4 ye
ars
25 to
29
year
s30
to 3
4 ye
ars
35 to
39
year
s40
to 4
4 ye
ars
45 to
49
year
s50
to 5
4 ye
ars
55 to
59
year
s60
to 6
4 ye
ars
65 to
69
year
s70
to 7
4 ye
ars
75 to
79
year
s80
to 8
4 ye
ars
85 y
ears
and
ove
r
2016 Population by Age (Millions)
Beacon EconomicsBeacon Economics
Trade Trends
14
-6.0
-4.0
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
Jan-
75
Jan-
78
Jan-
81
Jan-
84
Jan-
87
Jan-
90
Jan-
93
Jan-
96
Jan-
99
Jan-
02
Jan-
05
Jan-
08
Jan-
11
Jan-
14
Jan-
17
Share of GDP
Net National Savings Net Exports
Linear (Net National Savings) Linear (Net Exports )
-70000
-60000
-50000
-40000
-30000
-20000
-10000
0
Jan-
93A
ug-9
4M
ar-9
6O
ct-9
7M
ay-9
9D
ec-0
0Ju
l-02
Feb
-04
Sep
-05
Apr
-07
Nov
-08
Jun-
10Ja
n-12
Aug
-13
Mar
-15
Oct
-16
Trade Deficit
Beacon EconomicsBeacon Economics
The China Syndrome
15
Value US Exports to China
as % of GDP: 0.75%
Demands• reduce its trade surplus with the U.S. by
$200 billion over two years• would not challenge U.S. actions taken in
intellectual property disputes• stop subsidizing high-tech sectors
identified in its “Made in China 2025“ plan• cut tariffs on “all products in non-critical
sectors” to levels at or below U.S. duties • demanded that China not target U.S.
farmers and agricultural products • demanded that China not retaliate
against U.S. restrictions on Chinese investments
• ease a process for approving U.S. investments
Country Exports ImportsTotal, 829.8 1233.9China 64.0 7.7% 249.7 20.2%Canada 151.9 18.3% 160.0 13.0%Mexico 131.3 15.8% 169.3 13.7%Japan 35.7 4.3% 70.3 5.7%Germany 29.4 3.5% 62.3 5.0%United Kingdom 33.9 4.1% 29.3 2.4%Korea, South 27.1 3.3% 35.4 2.9%France 18.1 2.2% 25.7 2.1%India 15.5 1.9% 26.8 2.2%Italy 11.9 1.4% 26.8 2.2%Taiwan 13.6 1.6% 21.6 1.8%Netherlands 24.2 2.9% 10.7 0.9%
Value China Exports to US as
% of GDP: 4.0%
Beacon EconomicsBeacon Economics
CA’s Largest Trading Partners
$204.4
$51.8
$38.8
$21.6
$18.8
$11.7
$4.8
$3.9
$2.8
$1.9
0
50
100
150
200
250
#1 C
hina
#2 Jap
an
#3 M
exico
#4 S
. Kor
ea
#5 T
aiwan
#9 G
erman
y
#14 U.K
.
#16 Ita
ly
#19 Fra
nce
#21 Ire
land
$ B
illio
ns
Top CA Import Partners, 2016
$29.8
$24.6
$21.8
$15.3
$12.0
$4.6
$4.6
$4.1
$3.9
$2.5
0
5
10
15
20
25
30
35
#1 C
hina
#2 M
exico
#3 Jap
an
#4 S
. Kor
ea
#5 H
ong
Kong
#10 Ger
man
y
#11 U.K
.
#12 Switz
erland
#15 Net
herla
nds
#17 Fra
nce
$ B
illio
ns
Top CA Export Partners, 2016
Beacon EconomicsBeacon Economics
The Yuan response
5.405.605.806.006.206.406.606.807.007.20
2013
-10-
2820
14-0
1-28
2014
-04-
2820
14-0
7-28
2014
-10-
2820
15-0
1-28
2015
-04-
2820
15-0
7-28
2015
-10-
2820
16-0
1-28
2016
-04-
2820
16-0
7-28
2016
-10-
2820
17-0
1-28
2017
-04-
2820
17-0
7-28
2017
-10-
2820
18-0
1-28
2018
-04-
2820
18-0
7-28
Yuan / Dollar Exchange Rate
1. Japan (120,500 jobs)
2. United Kingdom (98,200
jobs)
3. Germany (69,600 jobs)
4. Switzerland (68,300 jobs)
5. France (68,000 jobs)
Beacon EconomicsBeacon Economics
Beacon EconomicsBeacon Economics
Population Shifts
19
-0.3%-0.2%-0.1%0.0%0.1%0.2%0.3%0.4%0.5%0.6%0.7%0.8%
2011 2012 2013 2014 2015 2016
Net Migration (% of Pop) by region
Northeast Region Midwest RegionSouth Region West Region
Florida 1.51% Ohio -0.05%Nevada 1.27% Penn -0.06%Colorado 1.10% Wisconsin -0.08%Oregon 1.08% Michigan -0.08%South Carolina 1.04% New Jersey -0.14%Washington 0.99% Vermont -0.19%Arizona 0.96% W Virginia -0.26%Texas 0.90% New York -0.27%North Dakota 0.79% Mississippi -0.28%Idaho 0.77% Kansas -0.30%Delaware 0.66% Connecticut -0.32%North Carolina 0.66% Wyoming -0.35%Montana 0.60% New Mexico -0.47%Georgia 0.54% Illinois -0.58%Tennessee 0.53% Alaska -0.73%
Net Migration by State 14-16
Beacon EconomicsBeacon EconomicsSource: Business Insider/Census Bureau 20
Beacon EconomicsBeacon Economics
California fact versus fiction
21
Beacon EconomicsBeacon Economics
Booms and Busts
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Growth in Real Output
United States California
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
1/1/
881/
1/90
1/1/
921/
1/94
1/1/
961/
1/98
1/1/
001/
1/02
1/1/
041/
1/06
1/1/
081/
1/10
1/1/
121/
1/14
1/1/
161/
1/18
US Unemployment
CA US
Beacon EconomicsBeacon Economics
State Economic Performance
Source: U.S. Bureau of Labor Statistics, U.S Bureau of Economic Analysis 23
Q1 2018 1 Year 5 YearWashington 4.3% 3.7%California 3.5% 3.7%Utah 3.7% 3.4%Colorado 4.5% 3.4%Oregon 3.4% 2.9%Florida 2.3% 2.8%Texas 4.2% 2.8%Idaho 3.2% 2.8%Georgia 2.5% 2.8%Nevada 4.0% 2.7%
Rk State #Ann Gr Share US1 Nevada 211.2 3.4% 1.7%2 Utah 218.3 3.2% 1.7%3 Florida 1238.2 3.1% 9.8%4 Oregon 252.1 2.9% 2.0%5 Idaho 92.1 2.8% 0.7%6 Colorado 328.7 2.7% 2.6%7 Washington 413.1 2.7% 3.3%8 California 2051 2.6% 16.3%9 Georgia 537.9 2.6% 4.3%10 South Carolina 237.6 2.4% 1.9%
Real Output Employment
Beacon EconomicsBeacon Economics
California Economic Engine
24
11.0%
11.5%
12.0%
12.5%
13.0%
13.5%
14.0%
14.5%
1981
:Q1
1982
:Q4
1984
:Q3
1986
:Q2
1988
:Q1
1989
:Q4
1991
:Q3
1993
:Q2
1995
:Q1
1996
:Q4
1998
:Q3
2000
:Q2
2002
:Q1
2003
:Q4
2005
:Q3
2007
:Q2
2009
:Q1
2010
:Q4
2012
:Q3
2014
:Q2
2016
:Q1
California Share National Personal Income
100
105
110
115
120
125
130
2005
:Q1
2005
:Q4
2006
:Q3
2007
:Q2
2008
:Q1
2008
:Q4
2009
:Q3
2010
:Q2
2011
:Q1
2011
:Q4
2012
:Q3
2013
:Q2
2014
:Q1
2014
:Q4
2015
:Q3
2016
:Q2
2017
:Q1
2017
:Q4
Real State Output Index
United States California
Beacon EconomicsBeacon Economics
Myth Busting
25
California's economy recently grew to become the world's fifth-largest economy if it were its own country.
Sounds like great news, but that wealth mostly benefits the very rich in the tech sector.
"Almost all the income growth and high-end job growth took place in Silicon Valley,”
Joel Kotkin, professor of Urban Studies at Chapman UniversityMay 18, 2018
25-50K 50-75K 75K-100K 100K+
State 318,146 179,115 177,425 484,322
Bay 4.4% 9.1% 24.1% 39.4%
So Cal 43.1% 27.7% 29.5% 39.4%
S Cen Val 19.6% 19.9% 8.8% 7.1%
N Cen Val 16.1% 11.8% 12.1% 10.1%
Cen Cst 5.3% 6.0% 5.1% 2.2%
Other 11.4% 25.5% 20.3% 1.8%
Share New FT Employees 2013-2016
Beacon EconomicsBeacon Economics
Median Household Income
Source: ACS 26
40
50
60
70
80
90
100
110
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017M
edia
n H
ouse
hold
Inco
me
($, T
hous
ands
)
Median Household Income
Los Angeles San FranciscoSan Diego Inland Empire
Region2017 Median Household
Income
% Change 2014-17
San Jose $117,474 21.8%
San Francisco $101,714 22.2%
San Diego $76,207 15.1%
San Luis Obispo $71,880 13.2%
Los Angeles $69,992 15.7%
Sacramento $67,902 13.1%
Inland Empire $61,994 13.6%
Fresno $51,800 19.3%
Merced $47,735 8.3%
Beacon EconomicsBeacon Economics
State Long Run Job Growth
Jun-18 20 Yr Ch 20 Yr Gr Sh State Jun-18 20 Yr Ch 20 Yr Gr Sh State
California 18,527.3 3,355.4 22.1% Stockton 304.7 66.2 27.8% 2.0%
Los Angeles (MD) 4,919.9 685.2 16.2% 20.4% Ventura 408.0 53.8 15.2% 1.6%
Inland Empire 1,949.6 657.5 50.9% 19.6% Visalia 186.8 38.5 26.0% 1.1%
San Diego 1,526.5 312.5 25.7% 9.3% Modesto 226.4 37.7 20.0% 1.1%
Orange County (MD) 1,560.5 225.4 16.9% 6.7% Vallejo 197.8 37.7 23.5% 1.1%
Sacramento 1,033.3 225.0 27.8% 6.7% Santa Barbara 207.6 29.5 16.6% 0.9%
Oakland (MD) 1,362.9 179.2 15.1% 5.3% SLO 137.6 29.2 26.9% 0.9%
San Francisco (MD) 994.3 141.2 16.6% 4.2% Santa Rosa 255.1 29.2 12.9% 0.9%
San Jose 1,050.5 103.6 10.9% 3.1% Salinas 205.3 27.0 15.1% 0.8%
Bakersfield 351.2 90.0 34.5% 2.7% Merced 106.6 21.0 24.5% 0.6%
Fresno 416.0 77.6 22.9% 2.3% Napa 70.6 16.3 30.0% 0.5%
Beacon EconomicsBeacon Economics
The Big Slowdown
Source: EDD 28
0
0.5
1
1.5
2
2.5
3
3.5
4
Jan-
11Ju
l-11
Jan-
12Ju
l-12
Jan-
13Ju
l-13
Jan-
14Ju
l-14
Jan-
15Ju
l-15
Jan-
16Ju
l-16
Jan-
17Ju
l-17
Jan-
18Ju
l-18
Year
ove
r Yea
r Gro
wth
(%)
YOY Growth Payrolls
CA Growth US Growth
17-18 16-17
San Jose 3.7% 2.3% 1,142 Stockton 3.3% 3.7% 244 Inland Empire 3.3% 3.6% 1,511 Fresno 3.2% 1.9% 357 California 2.0% 1.9% 17,203 San Diego 2.0% 1.6% 1,484 San Francisco (MD) 1.9% 1.8% 1,141 Oakland (MD) 1.9% 1.8% 1,189 Bakersfield 1.7% 1.8% 263 Los Angeles (MD) 1.2% 1.4% 4,513 Sacramento 1.0% 2.2% 985 Ventura 0.9% 1.7% 309 Orange County (MD) 0.5% 2.1% 1,636
Beacon EconomicsBeacon Economics
California Labor Markets
Source: U.S. Census 29
3456789
10111213
Jan-
90N
ov-9
1S
ep-9
3Ju
l-95
May
-97
Mar
-99
Jan-
01N
ov-0
2S
ep-0
4Ju
l-06
May
-08
Mar
-10
Jan-
12N
ov-1
3S
ep-1
5Ju
l-17
Unemployment Rate
California-0.5
-0.3
-0.1
0.1
0.3
0.5
0.7
0.9
1.1
1.3
1.519
75
1978
1981
1984
1987
1990
1993
1996
1999
2002
2005
2008
2011
2014
2017
% o
f Pop
ulat
ion
Net Migration as a % of Pop
Beacon EconomicsBeacon Economics
Los Angeles County
30
3456789
10111213
Jan-
90D
ec-9
1N
ov-9
3O
ct-9
5Se
p-97
Aug-
99Ju
l-01
Jun-
03M
ay-0
5Ap
r-07
Mar
-09
Feb-
11Ja
n-13
Dec
-14
Nov
-16
Unemployment RatesRecord Low for LA County
Los Angeles
4.5
Industry Employment for Los Angeles (MD)Industry Sep-18 17-18 16-17Total Nonfarm 4513.4 1.2% 1.4%Hospitality 551.8 5.1% 1.9%Admin Support 284.8 3.5% 2.3%Prof Sci Tech 292.3 2.1% 2.6%Health Care 688.8 2.1% 4.0%Financial Act 224.7 1.4% 0.7%Information 219.6 1.1% -4.1%Manufacturing 351 0.9% -2.7%NR/Construction 141.9 -0.1% 3.5%Education 127.9 -0.2% 6.3%Other Services 154 -0.3% 0.4%Logistics 193.5 -0.4% 4.9%Retail Trade 421.8 -0.4% 0.4%Government 582.3 -0.7% 1.0%Wholesale Trade 222.7 -0.8% -0.6%Management 56.1 -1.9% 0.0%
Average Labor Force Growth 2014-2018: .7%
Beacon EconomicsBeacon Economics
Housing = Economic Development
010002000300040005000600070008000
Q1-
95Q
2-96
Q3-
97Q
4-98
Q1-
00Q
2-01
Q3-
02Q
4-03
Q1-
05Q
2-06
Q3-
07Q
4-08
Q1-
10Q
2-11
Q3-
12Q
4-13
Q1-
15Q
2-16
Q3-
17
Residential Permits LA County
Single Famile Multi-Family
2% Job Growth
90,000 Jobs
1.5 Jobs / HH
60,000
24,400
Beacon EconomicsBeacon Economics
Los Angeles Demographics
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
Less than5
5 to 19y.o.
20 to 34y.o.
35 to 49y.o.
50 to 64y.o.
65 andolder
Los Angeles County Population By Age
1990 2000 2010 20178,000,000
8,500,000
9,000,000
9,500,000
10,000,000
10,500,000
1990 2000 2010 2018
County Total
Beacon EconomicsBeacon Economics
Changing Profile
2017 Ch 05-17
HS or Less 2,885,939 -7,740
Some College 1,824,889 299,900
Bach + 2,244,291 557,462
County Gr 15-17 City Gr 15-17Pop w Earn 5,364 2.7% 2,218 4.3%
Median Earn 32,169 5.1% 31,191 12.8%
< HS 21,901 7.2% 21,372 15.6%
HS 28,882 6.7% 26,656 5.7%
SC 36,535 3.4% 35,392 9.6%
Bach 54,442 4.8% 51,896 1.9%
Grad 77,200 7.6% 75,290 12.7%
Education Levels LA Adults (25+)
Beacon EconomicsBeacon Economics
Housing Burden
Source: ACS 34
30
32
34
36
38
40
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Median Rent as Share of Income
City of LA County
50
52
54
56
58
60
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Share of Rent Constrained Households
City of LA County
Beacon EconomicsBeacon Economics
Commuting
Who Works in LA? Where do LA People Work?
2012 2017 2012 2017
Los Angeles 4,100,000 4,500,000 Los Angeles 4,100,000 4,500,000
Orange 186,755 180,195 Orange 177,942 208,865
San Bernardino 135,333 132,578 San Bernardino 48,689 62,317
Ventura 69,075 74,960 Ventura 39,796 33,713
Riverside 53,382 51,935 Riverside 16,478 16,758
Kern 11,745 9,076 Outside of California 15,342 13,596
San Diego 6,221 4,110 Kern 8,055 7,047
Santa Barbara 1,208 1,623 San Diego 6,146 4,177
Beacon EconomicsBeacon Economics
Santa’s List10-17 90=17 10-17 90=17
County Total 103,766 3.0% 383,543 12.1% Vernon 47 162.1% 46 153.3% Artesia 10 0.2% 173 3.8%Los Angeles 71,691 5.1% 183,621 14.1% Bradbury 9 2.3% 128 45.6% Culver City 87 0.5% 635 3.7%Santa Clarita 12,239 19.7% 33,150 80.6% Irwindale 10 2.6% 118 41.8% Bellflower 80 0.3% 859 3.6%Palmdale 511 1.1% 22,616 92.5% Signal Hill 217 4.9% 936 25.5% Hermosa Beach -136 -1.3% 337 3.5%Lancaster 1,046 2.0% 16,660 46.0% Avalon 28 1.2% 406 21.5% El Segundo 23 0.3% 243 3.4%Unincorporated -5,238 -1.7% 14,870 5.0% Hidden Hills 5 0.8% 104 19.7% Whittier 122 0.4% 955 3.3%Pasadena 2,619 4.4% 9,141 17.2% Claremont 303 2.5% 1,584 14.6% Covina 98 0.6% 533 3.3%Glendale 3,907 5.1% 8,062 11.2% Santa Fe Springs 518 10.4% 677 14.1% Palos Verdes Est 15 0.3% 167 3.3%Long Beach 1,213 0.7% 6,890 4.0% Westlake Village 2 0.1% 380 12.6% Norwalk -16 -0.1% 820 3.0%Santa Monica 1,529 3.0% 4,688 9.8% Walnut 269 3.1% 931 11.5% Lakewood 82 0.3% 758 2.8%Torrance 150 0.3% 3,600 6.6% San Dimas 287 2.3% 1,314 11.4% Lomita 77 0.9% 211 2.5%Burbank 333 0.8% 3,422 8.3% San Fernando 145 2.3% 642 11.1% La Canada Flint 3 0.0% 174 2.5%Pomona 811 2.0% 3,037 7.9% Agoura Hills 40 0.5% 700 10.1% Manhattan Beach 120 0.8% 354 2.4%Gardena 401 1.9% 2,840 14.9% La Verne 461 3.9% 1,057 9.5% Maywood -5 -0.1% 69 1.0%Redondo Beach 119 0.4% 2,508 8.9% Azusa 988 7.4% 1,178 8.9% San Marino 6 0.1% 18 0.4%El Monte 247 0.8% 2,174 8.0% Duarte 83 1.1% 567 8.4% Inglewood 226 0.6% -58 -0.1%Alhambra 806 2.6% 2,123 7.2% Glendora 502 2.8% 1,403 8.3% South El Monte 129 2.7% -27 -0.6%West Hollywood 1,245 5.1% 2,012 8.4% Arcadia 384 1.9% 1,590 8.2% Bell -1 0.0% -185 -2.0%Carson 63 0.2% 1,848 7.6% Rolling Hills Est 1 0.0% 228 7.9% La Habra Heights 17 0.9% -264 -12.2%La Mirada 42 0.3% 1,780 13.3% Monrovia 548 3.8% 1,089 7.8% Industry -5 -6.8% -71 -51.1%
Beacon EconomicsBeacon Economics
Los Angeles Economy: Long Run
37
3,700,000
3,900,000
4,100,000
4,300,000
4,500,000
4,700,000
4,900,00019
9019
9119
9219
9319
9419
9519
9619
9719
9819
9920
0020
0120
0220
0320
0420
0520
0620
0720
0820
0920
1020
1120
1220
1320
1420
1520
1620
17
Employment LA Economy
Civilian Employment Total, All Industries
Beacon EconomicsBeacon Economics
Top City Growth: West
38
Household Employment by Metro
Metro 2016Chg, 2010 to 2016
% Absolute
Los Angeles-Long Beach-Anaheim 6,316,214 11.0 625,998
Dallas-Fort Worth-Arlington 3,542,411 16.7 508,100
Houston-The Woodlands 3,115,118 14.3 390,199
San Francisco-Oakland 2,447,183 17.1 356,613
Phoenix-Mesa-Scottsdale 2,135,994 14.0 262,366
Riverside-San Bernardino 1,870,456 16.1 259,420
Seattle-Tacoma-Bellevue 1,935,115 13.4 229,383
Austin-Round Rock 1,074,307 24.1 208,713
Denver-Aurora-Lakewood 1,492,974 14.9 193,291
San Jose-Sunnyvale-Santa Clara 1,015,579 19.0 161,799
100
105
110
115
120
125
130
135
140
145
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
Real Metro Product Indexes
So Cal US Balance
Beacon EconomicsBeacon Economics
MSA Output Trends (LA / OC)
2017 Gr 01-17 LQ GR Q
All industry total 904899 2.3% 10.5%
Real estate 198865 3.7% 1.57 38.2%
Information 116238 5.3% 2.09 20.7%
Accommodation 23592 2.4% 0.93 19.9%
Construction 25591 0.0% 0.73 13.1%
Health care 53313 3.3% 0.79 12.8%
Education 8498 2.2% 0.91 10.8%
Arts, entertainment 19403 2.7% 2.02 9.7%
Transportation 21636 2.2% 0.87 7.3%
Other services 18815 -0.1% 1.01 1.0%
Government 77782 0.5% 0.75 0.0%
Wholesale trade 57039 1.7% 1.01 -4.5%
Nondurable goods 29421 -0.1% 0.71 -4.5%
Retail trade 49805 1.4% 0.90 -5.3%
Finance 38242 1.0% 0.63 -5.7%
Durable goods 50176 2.5% 0.85 -6.5%
Professional 67013 1.9% 0.94 -12.6%
Administrative 29320 2.5% 0.97 -12.8%
Management 14276 -1.0% 0.67 -47.6%
Beacon EconomicsBeacon Economics
Los Angeles County Employment
40
1990 2016 GR ChangeCivilian Labor Force 4,498,700 5,043,300 12.1% 544,600Civilian Employment 4,233,100 4,778,800 12.9% 545,700
Total, All Industries 4,193,200 4,395,700 4.8% 202,500Construction 146,300 133,100 -9.0% -13,200Manufacturing 814,800 360,400 -55.8% -454,400Wholesale Trade 229,500 227,000 -1.1% -2,500Retail Trade 408,300 422,300 3.4% 14,000Transportation & Warehousing 144,500 168,800 16.8% 24,300
Information 194,200 230,900 18.9% 36,700Motion Picture & Sound Recording 103,800 150,500 45.0% 46,700Finance & Insurance 198,300 138,100 -30.4% -60,200Real Estate & Rental & Leasing 82,600 81,700 -1.1% -900Professional, Scientific & Technical Services 244,900 278,300 13.6% 33,400Management of Companies & Enterprises 80,800 56,900 -29.6% -23,900Administrative & Support & Waste Services 220,900 270,000 22.2% 49,100Educational Services 85,300 123,000 44.2% 37,700Health Care & Social Assistance 314,000 644,400 105.2% 330,400Arts, Entertainment & Recreation 56,000 86,700 54.8% 30,700Accommodation & Food Services 253,000 423,900 67.5% 170,900
Other Services 137,500 153,400 11.6% 15,900Government 542,500 576,300 6.2% 33,800
Beacon EconomicsBeacon Economics
A Changing Labor Market1990 2017 Ch
Civilian Labor Force 4,498.7 5,123.0 624.3 Civilian Employment 4,233.1 4,882.1 649.0
Total, All Industries 4,193.2 4,441.4 248.2
2017 Ch 2017 ChTransportation Eq Mfg 45,600 -112,100 Electrical eq Mfg 9,900 -15,400Computer Electronic Mfg 42,100 -85,100 Telecommunications 20,800 -14,900Apparel Mfg 31,700 -58,500 Primary Metal Mfg 6,200 -9,700Credit Intermediation 61,200 -42,700 Heavy Engineering Const 12,600 -9,500Fabricated Metal Mfg 42,700 -33,000 Hobby, Book & Music Stores 14,500 -9,400Federal Government 48,000 -26,500 Paper Mfg 6,700 -8,400Furniture Mfg 13,700 -24,600 Petroleum Products Mfg 5,700 -8,100Machinery Mfg 13,900 -23,900 Total Farm 5,800 -7,900Management 57,400 -23,400 Publishing Industries 15,900 -7,500Printing Activities 13,500 -22,600 Food Mfg 40,500 -7,200Insurance Carriers 50,300 -19,900 Air Transportation 26,800 -7,100Plastics Mfg 12,600 -16,200 Accounting 44,000 -6,000
Beacon EconomicsBeacon Economics
A Changing Labor Market1990 2017 Ch
Civilian Labor Force 4,498.7 5,123.0 624.3 Civilian Employment 4,233.1 4,882.1 649.0
Total, All Industries 4,193.2 4,441.4 248.2
2017 Ch 2017 ChSocial Assistance 252,300 205,700 Hospitals 119,200 18,700Accommodation & Food 435,000 182,000 Computer Systems Design 35,700 16,600Ambulatory Health Care 214,600 97,200 Investigation & Security 53,200 15,800Local Government 444,900 46,800 Food & Beverage Stores 93,500 12,900Educational Services 125,300 40,000 Personal Services 54,600 12,200Support for Transportation 59,800 33,900 Religious, Grants 61,000 9,000Nursing Care Facilities 82,900 33,300 Services to Buildings 45,000 7,100Arts, Entertainment 88,900 32,900 Broadcasting 23,300 6,500Motion Picture & Sound 132,600 28,800 Real Estate 63,000 5,300Management, Scientific 50,600 28,100 Health & Personal Care 32,700 4,500Employment Services 105,900 27,800 Couriers & Messengers 25,500 4,400State Government 92,500 22,600 Clothing s Stores 56,800 2,900
Beacon EconomicsBeacon Economics
A Changing Labor Market1990 2017 Ch
Civilian Labor Force 4,498.7 5,123.0 624.3 Civilian Employment 4,233.1 4,882.1 649.0
Total, All Industries 4,193.2 4,441.4 248.2
2017 Ch 2017 ChWholesale 224,500 -5,000 Chemical Mfg 19,600 -5,300
Trade Contractors 90,900 -500 Warehousing & Storage 19,400 1,000General Merchandise 67,500 2,600 Scientific Research 19,400 1,600Legal Services 51,100 -2,100 Electronics & Appliance 18,100 -1,000Motor Vehicle & Parts 47,000 2,000 Business Support Services 15,200 -2,200Repair & Maintenance 38,500 -4,600 Furniture Stores 14,500 -400Construction of Buildings 34,200 1,300 Gasoline Stations 12,100 -1,500Architectural, Engineering 33,300 -500 Transit & Passenger 11,800 1,100Truck Transportation 29,400 2,500 Utilities 11,600 -6,200Securities, Commodity 25,900 1,800 Travel Arrangement 9,400 -4,400Building Material & Garden 25,100 -1,700 Data Processing 7,700 800Advertising Services 24,300 100 Textile Mills 5,000 -3,300
Beacon EconomicsBeacon Economics
Firms by Size (00-16)
<100 100-499 500-999 >1000 <100 100-499 500-999 >1000Total 263,794 5,140 342 213 43,314 -56 -38 -13Construction 14,127 130 6 6 2,113 -38 -3 0Manufacturing 11,462 580 39 24 -4,885 -582 -37 3Wholesale trade 22,844 327 20 4 1,144 -61 7 0Retail trade 28,196 810 10 1 640 252 -2 1Logistics 7,421 221 23 14 2,641 -6 8 3Information 10,376 281 22 20 2,126 20 -7 1Finance 12,942 185 23 13 2,502 -44 -2 -1Real estate 15,788 87 7 0 4,848 6 3 -3Professional 34,778 381 26 9 9,756 70 -3 -20Management 1,276 149 17 13 155 4 2 1Admin, support 10,639 420 38 16 616 -159 -24 -16Education 3,793 176 18 18 1,331 80 5 6Health care 31,337 672 48 57 8,851 287 8 6Arts, entertainment 15,190 103 11 7 7,214 -12 4 1Accommodation 22,039 412 22 4 6,320 160 9 3Other services 20,245 170 10 4 1,216 -1 -1 1
Beacon EconomicsBeacon Economics
What can Beacon do for you?
45
Housing, Land Use, & Real Estate
Advisory
Sustainable Growth and
Development
Economic & Revenue
Forecasting
Economic, Fiscal and Social Impact
Analysis
Regional and Sub-Regional Analysis
Litigation and Testimony
For more information, see Slide 2.
Continue the conversation.
Contact Dr. Chris Thornberg directly at [email protected] or 310.571.3399
Let’s discuss your goals and needs.
Beacon has 6 Practice Areas covering a range of services and products.
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Connect with us.
Our 6 Practice Areas
Beacon EconomicsBeacon Economics
Portfolio Spotlight
46
Housing, Land Use, &
Real Estate Advisory
Economic & revenue
forecasting
Litigation and
testimony
Sustainable Growth &
Development
Impact (Economic,
Fiscal, Social) & EB5
Analysis
Regional and Sub-
Regional Analysis
Beacon conducts analysis at an international, national, state, county, and city level -- and even down to the zip code, pending data availability. We analyze data on Employment, Industry, Real Estate, and Consumption.
Past Clients:
• City and County of Los Angeles• City and County of Riverside • East Bay Economic Dev. Agency
Beacon has evaluated the impact of entities like universities, music festivals, infrastructure projects, and real estate development projects. Beacon has also conducted impact analyses that combine more than one of the above like that of L.A’s Olympic bid.
Past Clients:
• University of Southern California• Metropolitan Water District• LA 2024 Olympic Bid Committee
Beacon conducts industry and policy analysis on topics like green innovation, tech and workforce development, and industry sector strategies. Beacon has strong in-house expertise around housing policy and economic development support.
Past Clients:
• California Apartment Association• Long Beach Downtown Dev. Corp.• Santa Cruz Workforce Dev. Board