LAEDC Report Says U.S., California and Southern California Recession to Hit Bottom by Year-End, Recovery Starts in 2010

(l-r Bill Allen, CEO & Pres., LAEDC, Lloyd Greif, Chair, LAEDC, Frank Mottek, KNX Business Hour, Nancy Sidhu, chief economist, Jack Kyser, founding economist, Kyser Research Center and John Burns, Real Estate Consulting. (photo by George S. Mc Quade III

There are negative trends in most business sectors. Some key industries--fashion, entertainment and aerospace--facing changed business models. Federal stimulus funding starting to arrive in Southern California.

Los Angeles, CA (PRWEB) July 22, 2009 -- The 2009-2010 "Mid-Year Economic Forecast & Industry Outlook" from the Kyser Center for Economic Research at the Los Angeles County Economic Development Corporation (LAEDC) sees difficult times continuing for the nation, the state and Southern California through the rest of 2009 and into 2010.

"We think the economy is nearing bottom this summer, so the current economic news looks terrible," said Nancy D. Sidhu, Ph.D., the LAEDC's Chief Economist. "This recession officially began in December 2007 and looks like it will be the deepest downturn since the recession of 1981-1982."

Overall, the LAEDC Forecast projects the U.S. economy will shrink by 2.7 percent during 2009 and grow modestly--by 1.7 percent--in 2010. Inflation is unlikely to be a problem in the near term, declining by

0.8 percent in 2009. "The auto and housing industries are experiencing real difficulties," observed Sidhu. Only 9.9 million light vehicles are expected to be sold during 2009, compared with 16.1 million sold during 2007; this has driven two of the "Detroit Three" and many suppliers to bankruptcy.

The nation's housing sector has been shrinking for more than three years now, but it looks like the bottom is near. About 530,000 housing starts are projected for 2009, compared with the recent high of nearly 2.1 million starts in 2005.

Business investment spending and U.S. exports also are declining. Federal government spending is the only sector that is growing. Federal stimulus funds are finally beginning to appear in Southern California and their impact will grow through the rest of 2009 and 2010.

"The news on the employment front will reflect all this weakness, with U.S. average nonfarm employment dropping by 5.4 million jobs during 2009," added Sidhu. The unemployment rate will average 9.3 percent during the year, and will run up to 10.4 percent in 2010. These are the highest jobless rates since 1982.

"At mid-year 2009, California too is in a serious recession, and the economic news during 2009 has been dismal," continued Sidhu. The state's economic downturn also should hit bottom by the end of 2009, but the recovery will be moderate at best. The state's non-farm employment will fall by 4.6 percent or by 694,100 jobs in 2009, while the unemployment rate will average a painful 11.6 percent.

California's housing industry is in a very depressed state, especially in the inland areas. The number of housing permits issued in California during 2009 will slide down to just 37,000 units, compared with the recent high of 212,960 units permitted in 2004. The resale housing segment continues to see large numbers of foreclosed properties and short-sales hitting the market.

The state's retail sector is also being hammered, with sales expected to decline by 12.0 percent in 2009, following sales declines in both 2007 and 2008. Retail stores of all types will continue to close throughout the forecast period. Sidhu noted that auto dealers have been especially hard hit, and recycling these sites will be a challenge.

"The five Southern California metro areas are struggling in 2009," said Jack Kyser, founding economist of the Kyser Center for Economic Research. "Job losses will continue in construction, manufacturing, retailing and leisure and hospitality services."

Measured by percentage declines in non-farm jobs, the Riverside-San Bernardino area and Ventura County are feeling the most pain, and will record employment declines of 6.7 percent and 5.1 percent respectively. Orange County should see employment drop by 4.8 percent, while Los Angeles County should record a decline of 4.1 percent. San Diego County will see a 3.8 percent loss in non-farm jobs.

New homebuilding in the region will hit new lows. The best example is the Riverside-San Bernardino area, where fewer than 5,000 new units will be permitted in 2009, compared with the recent high of 52,696 units in 2004. The homebuilding industry in Ventura County also will be scraping bottom in 2009, with just 275 units permitted compared with 4,516 units in 2005.

The nonresidential real estate market is also troubled. Funding for new projects or loan roll-overs is extremely difficult to obtain, and some office and retail developments could well go into foreclosure. Reuse of the latter is going to be difficult given the glut of retail space.

"Almost all major Southern California industries are struggling during 2009," continued Kyser. "Worse, in some cases entire business models are changing." One example is apparel manufacturing, where the number of potential customers for local garment producers is shrinking due to store closings, while many firms rely on CIT for financing.

Another is the motion picture/TV production industry. On the TV side of the business, the audience for the broadcast networks is shrinking and cost containment is a major concern. As to feature film production, while the box office is running at record levels, California's incentives for the film industry were late in coming, and it's not yet clear whether they will be sufficient to stem the continued erosion of in-state feature film production. "This is not good news for below-the-line workers or the multitude of small suppliers to the industry," said Kyser.

International trade activity at the region's ports and airports will continue to decline. Container activity at the Los Angeles/Long Beach port complex peaked back in 2006 when 15.76 million TEUs were handled. In 2009, the forecast is for 12.2 million TEUs to be moved, and the impact of this decline has rippled out to longshoremen, truck drivers and the industrial real estate markets throughout the entire metropolitan area.

The local aerospace industry is confronting its own challenges in 2009-2010. Defense spending is set to slow, while commercial aircraft production is declining outright as profit-starved airlines reduce orders.

This report includes a look at the economic situation in twelve sub-county economic areas of Los Angeles. Measured by the number of jobs lost in 2009, the areas most severely impacted by the current recession are: Santa Clarita (which will lose 6,000 jobs), North Gateway and East L.A./Eagle Rock (both expected to lose 5,300 jobs).

Sub-areas losing the fewest jobs will be: the San Fernando Valley (down by 1,700 jobs in 2009); South Bay/LAX (losing 2,400 jobs); the San Gabriel Valley (down by 2,500 jobs); Central L.A./Downtown (losing 2,600 jobs); and the Westside (down by 2,700 jobs). Manufacturing is quite important to several of these sub-areas, including the San Gabriel Valley, South LA, East LA/Eagle Rock and the North Gateway region.

About the LAEDC:
The LAEDC, the region's premier business leadership organization, is a private, non-profit organization established in 1981 under section 501(C) (3). Its mission is to attract, retain, and grow business and jobs for the regions of Los Angeles County. Since 1996, the LAEDC has helped retain or attract more than 152,000 jobs, providing $7.5 billion in direct economic impact from salaries and $128 million in annual tax revenue benefit to local governments and education in Los Angeles County. Visitwww.laedc.org or call (888) 4-LAEDC-1.

Editors: The Mid Year Forecast and Industry Outlook study results will be posted athttp://laedc.org/newsroom/Midyear-2009-07.pdf and www.MayoCommunications.com/home.htm (12:01 AM Wed). Media please call George McQuade for advanced copy or link 818-340-5300 or 818-618-9229 or email: Publicity(at)MayoCommunications(dot)com.

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Entertainment Publicists Speak Out on Social Media Measurement How PR Pros Can Brand and Buzz on Twitter, Facebook and Blogs

Entertainment Publicists Professional Society Mixer

EPPS Summer Mixer Cools Off At
Poolside in Hollywood

By George S. McQuade III


When you hear 90-year Entertainment Publicists Julian Myers in Hollywood talk about the importance new media, it makes you feel happy you are headed in the right direction or if you’re not, what you are missing. Myers was amongst several hundred Entertainment Publicists Professional Society (EPPS) members attending a Summer Mixer at the Skybar, Mondrian Hotel, West Hollywood, CA this week (7-16-09).

Season A. Skuro, PR, TECHNICOLOR
with Julian Myers

“Well, I enjoyed the Old Testament very much, and it’s nice new reading,” said Julian Myers, Myers PR, who used to wake up Actress Marilyn Monroe to go to celebrity events in Hollywood after partying all night. “I’ve been around for awhile, but after 2,000 years, I think I know new media quite well and I look forward to reading about more new media I heard about the other day- the Gettysburg Address.”
Myers admitted that he and other Hollywood publicists have lagged behind in new media, but like journalists who cover his clients, he said “the basic concepts of publicity are always the same. Be honest, and think of new ways to make first yourself, second your client famous.”
Myers also said, “It’s exciting to quickly get an online buzz, but the big question is how do you measure it? What are you supporters saying about your or opposition in the blogosphere?”

Glen Anderson with Skybar
Waitress Clare Porter 

 “New media is definitely helping, but the only problem with new media,” said independent publicists Glenn Anderson, “it takes so much time to keep up and keep all of those Linked-In, MySpace, Facebook and Twitter sites up to day. You spend more time tweeting and Facebooking than time needed for your clients.”


“New media definitely has it’s time and place,” said Tiffany Victoria Bradshaw, Marketing Consultant. “A lot of people still don’t quite understand it the way they should. They often think it takes the place of traditional marketing Efforts.
I feel, because I’m kind of old school in marketing, not because I am old, but I still appreciate traditional marketing. Let’s make sure we have identified your target market, make sure you have a good 30 second networking pitch, and make sure you have a good sales presentation. All these still apply, market research, etc, regardless of new media, so you can not just skip over that,” said Bradsaw.

“I’m a little behind the times with the new media,” said PR Pro Ellen Giurleo. “I’ve been resisting getting on Facebook, because it will take all this time, but all the people I’ve talk to tell me and I know I have to do it, or at least get a business page up. Probably not a personal page though,” she said.
“Oddly enough, I was spending a lot of time on Twitter today learning how to do it,” said TV Guide’s Chad Sandhas. “I’m only 34 and I feel like I am catching up so new media I think is scary for all of us.”
“I have to agree with Chad,” said Eileen Salmas, PhotoStamps.com. “I don’t Twitter, I don’t text, and I’ navigating around Facebook and Linked-In. I’m trying to figure out how to use it for the company, but that’s not really my job. It’s a little bit daunting.”
Motion Picture & TV Fund Stirs Controversy

The EPPS mixer was sponsored by the International Cinematographers Union ICG Local 600 and on behalf of Motion Picture and TV Fund (MPTF), which is scheduled to close its hospital and end its acute long term care unit due “a $10 million loss,” at the end of 2009.

Ken Scherer, director, MPTF 

“We are an 89 year old charity in Hollywood, created by Hollywood for Hollywood and it takes care of people who have fallen on hard times,” said Ken Scherer, director, MPTF. “Everyone thinks that everyone in Hollywood makes $20 million dollars, which is simply not true, and so we provide financial assistance, medical care and all kinds of support including retirement care.”

In his speech to EPPS members he said, “We didn’t do a very good job in PR,” and later told this writer, “We have some people onboard doing new media and everything.” Additionally, Scherer said he “got involved while successfully starving as a TV producer, and was called to run the foundation, which raises the money for the MPTF, I was happy to take the job.”

Even Jeffery Katzenberg, principal partner of DreamWorks L.L.C. and Co-founder, DreamWorks Animation SKG Inc. came out to help brand and promote the nonprofit.

Longtime Publicist Julian Myers was upset that Katzenberg failed to take questions after talking about the Moton Picture & TV Fund organization.

Jeffery Katzenberg, principal partner
 of DreamWorks L.L.C. and Co-founder
, DreamWorks Animation SKG Inc.

Myers told this writer he had a lot of questions and said, “There is no reason to abandon the residents of the Motion Picture Country homed. NONE! The hundreds of us who, love our industry will back annual shows at the Coliseum (100,000 capacity), where our wonderful caring stars will perform to keep the dreams of us who have worked all our lives in Hollywood alive. Yes, Barbara Streisand, Dick Van Dyke, Julie Andrews, Tony Bennett, great comics and new stars will gladly appear.”

Julian Myers with ICG Rep.

Myers also noted that he was, “contributing to this fund before Mr. Katzenberg was born (1950) literally, and I know how it is in hearts of countless colleagues. 

There are hundreds of thousands of people, men and women who have worked in Hollywood all of their lives and had the dream that if necessary ‘Hollywood would take care of its own’,” said Myers. Myers also won the door prize of the 2009 O’Dwyer Director of PR firms.

If you want to donate or help out the Motion Picture and TV Fund 818-876-1900 or visit: www.MPTVFund.org.

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Michael Jackson's Last Show On Earth

A Live Event For a Dead Superstar Costs Taxpayers $5 Million Dollars

“This has gotten to the point, where AEG needs to step up to the plate and pay for the costs of Michael Jackson’s Memorial,” Los Angeles City Councilman DennisZine said shortly after the event at Staples Center in Downtown Los Angeles.

Michael Jackson - LIFE image

From a publicity standpoint the numbers are still being tallied, but when all three networks, cable networks Fox and CNN broadcast the event live without sponsorship the lost could amount to millions of dollars. This is probably the most positive publicity Michael Jackson has received in his entire lifetime, even more than the 55 tour dates he was rehearsing for at Staples, video of which was shown during the live world telecast at Staples.

There was not news conference or news release needed, just a twitter or two, which alsowas over capacity from people tweeting inside and outside the event.

For the City of LA, $500 million in the red and sending employees home early on Fridays it was expensive. According to Zine the Swat Team and those who work anti terrorism were all called in for the media circus. Zine a former LAPD sergeant for several decades also noted that the freeways were shutdown impacting businesses and commuters to downtown Los Angeles and to and from the Forest Lawn Cemetery, where it all began at 8:00 AM.

All the major networks put out the best LAPD message over the airwaves, “the best seat in the house is on your couch at home.” True. 17,000 plus people were issued lottery tickets, but many stayed home for the best seat in the house. So did this writer.

Overall, the ceremony was outstanding, the most dead air ever witnessed at a concert memorial, so quiet you could hear the air conditioners whirling.

Most of the people inside the Staples who spoke harped on the same theme that Michael Jackson brought the worldtogether with songs like, “I will be there, we are the world,” and so on. The music and speeches were inspirational and moving from Smokey Robinson, Berry Gordy, who got the largest standing ovation when he said, “Michael was the greatest entertainer ever.”

Usher, Stevie Wonder and even Reverend Al Sharpton was more low key, and on key with the same theme.

“I just want you children to know there was nothing strange about your Daddy, but there were a lot of strange things your Daddy had to deal with,” said Rev. Sharpton.

There is always light at the end of the gloomy economic tunnel. In this case, one Holiday Inn hotel manager said after AEG announced the memorial to be held across the street from his Inn, 195 rooms sold out. Elsewhere, hotels did well, too and some estimatesrange from $3 to $4 million from those keeping track of the figures.

Tomorrow’s headlines will probably read

“King of Pop Saluted in Emotional Memorial.”

There is always light at the end of the gloomy economic tunnel. In this case, one Holiday Inn hotel manager said after AEG announced the memorial to be held across the street from his Inn, 195 rooms sold out. Elsewhere, hotels did well, too and some estimatesrange from $3 to $4 million from those keeping track of the figures. Tomorrow will tell a new story, and the freeways will be packed again, not with limos but single car drivers.

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