Local economists say recession has ended

Posted: May 7, 2010 9:07 PM by Ariel Wesler
Updated: May 7, 2010 9:07 PM

The worst may be over. That's what we're hearing about northern Santa Barbara County's economy tonight.

Allan Hancock College in Santa Maria hosted the economic forecast project today-- conducted by U.C.S.B. Local economists say we are out of the recession but we should expect to see slow growth over the next few years. Still, businesses that have survived the recession should begin to see steady improvements.

"How many people are ready to hear that you've been isolated from this recession. That things are going to be great and we'll have nothing but good news from here on out," Brad Kemp, the Director of Regional Research for Beacon Economics.

Economists didn't hold back today while speaking about northern santa barbara county's economic forecast.

"Farm has been a rock, an absolute rock for north county. I wish I could say that for more industries," Kemp said.

On the job front, economists say don't expect to see huge recovery. The days of returning to a four or five percent unemployment rate are long gone.

"The efficiency that employers have been forced to work under given this recession is something they're going to keep for some time to come," Kemp said.

Economists say while the government tried to be proactive in helping us out of the downturn, encouraging consumer spending, in some cases, they made matters worse.

"Not only are these policies creating new sets of problems, the potential for inflation, this giant federal deficit, but they're actually preventing the underlying problems from healing," said Economist Chris Thornberg.

In real estate, more than a quarter of homes in Santa Barbara are worth less than what people owe on them, so foreclosures will continue.

There is some good news to all of this. Economists say the recession is indeed but the recession is indeed over and we may not notice any big improvements until at least 2013.

Although the county got into the recession later than its neighbors, we appear to be emerging at the same time.

"What made you grow so well before is still here, great quality of life, affordable compared to other areas," Kemp said.

Kemp also compared the recession to sinking in a pool. He said we've now stopped sinking, but we're still at the bottom. Now, we have to work on swimming to the surface.

Economists advise being patient. The psychological effects of the recession will also take time to wear off.