Debt Ceiling Deal Contains Risk For San Diego Economy
Tuesday, August 2, 2011
SAN DIEGO The top economist at the San Diego Association of governments says the federal government debt-ceiling deal, carries a threat to San Diego. Two trillion dollars in spending cuts will likely reduce the amount of military spending here. Military spending has been a strong point in the local economy, as the rest of the economy suffered during the downturn.
"The civilian economy really doesn't appear to have rebounded completely from the decline," said Marney Cox on KPBS' Midday Edition. "The last couple months in a row, job growth on average, have been about 20,000 jobs, nationwide. And we typically get about 1 percent of the nation's employment growth."
San Diego's share of that growth only represents about 200 new jobs a month. The region lost tens of thousands of jobs during the recession.
Sales tax revenue has begun bouncing back last year, said Cox, but the recovery is expected to moderate this year with an anemic growth rate.
"Some people are predicting as low as zero and somewhere between zero and 4 percent growth as opposed to the 8 percent growth we saw this last year," said Cox. "So, although its growth and its positive and its in the correct direction it'll be a lot less strong than what we've seen just his past fiscal year."
The region's housing industry and the local job market both continue to suffer, said Cox.