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Tentative Budget Deal Could Give San Diego Economic Boost In 2014

Evening Edition

Aired 12/11/13 on KPBS Midday Edition.

GUESTS

Lynn Reaser, Ph.D., chief economist of the Fermanian Business & Economic Institute of Point Loma Nazarene University

Murtaza Baxamusa, Ph.D., secretary-treasurer of Middle Class Taxpayers Association;

Transcript

Tuesday's tentative budget agreement in Washington could be very good news for San Diego's economy.

Budget forecasters were nervous about the effects of more sequestration cuts, and another possible government shutdown on our fragile recovery.

But while the federal government won't be as big a problem as feared, it also won't be providing as much help as it has over the past difficult years.

Lynn Reaser, chief economist for the Fermanian Business and Economic Institute at Point Loma Nazarene University said 2014 should be positive for the San Diego economy.

Reaser's 2014 Economic Outlook for San Diego says this year, our economy has to begin relying on its own strengths- it has to take off the "training wheels."

Reaser predicts the San Diego region will gain 28,000 jobs next year. That would raise employment above pre-recession levels.

The forecast predicted the technology sector will drive a lot of the job growth, that tourism will grow and the recovering housing market will help.

"We'll likely see a little more moderation in the coming year with home price increases somewhat less than 10 percent," Reaser said. "(That's) about half of what we saw last year. But still, we'll see more home sales, more home buyers, more home building permits, so it should still be a year of recovery for the home-building area."

Even so, there are some areas of concern.

San Diego is still facing the prospect of negative economic pressure from shrinking military budgets, rising college costs and over-regulation, she said.

KPBS business reporter Erik Anderson contributed to this report.

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