NEWS FROM CALIFORNIA STATE UNIVERSITY, BAKERSFIELD
FOR IMMEDIATE RELEASE
FEB. 19, 2003
CONTACT: Mike Stepanovich, 661/664-2456; firstname.lastname@example.org
The bears are out of hibernation in Kern County and they've taken a bite out of the local economy, according to a survey in the latest issue of the Kern Economic Journal, published by California State University, Bakersfield.
Local business managers are now pessimistic about local economic conditions, the Journal reported. The Business Outlook Index declined 17 points from 112 in the third quarter to 95 in the fourth quarter.
Likewise, Kern County consumers' confidence continues to slip. The Kern Consumer Sentiment Survey fell another 15 points in the fourth quarter to 103, its lowest point in a year.
And after three quarters of steady decreases, the Kern County unemployment rate rose in the fourth quarter from 9.8 percent to 10.4 percent. Bakersfield's jobless rate rose from 7.9 percent in the third quarter to 8.5 percent in the fourth quarter.
Despite the gloomy economic news, a few bright spots were evident. In
a story detailing local economic indicators, the Journal reported that:
ï Personal income in both Kern County and Bakersfield continued its steady rise. Personal income per capita also continues to rise.
ï While economic growth slowed from 1.8 percent to 1.5 percent in Kern County, it accelerated from 1.2 percent to 1.9 percent in Bakersfield.
ï Bakersfield remains one of the most affordable places to live in California.
A key factor in the decline in consumer confidence caught the attention of Mark Evans, an economics professor and interim dean of CSUB's Extended University Division, who conducts the quarterly survey. The percentage of households "indicating they were better off than a year ago plummeted from nearly 50 percent to 20 percent," Evans said. "The percent indicating they were worse off nearly tripled from 8 percent to 21 percent. This is a troubling development."
The Business Outlook Survey is cause for concern, said Abbas Grammy, CSUB economics professor and publisher of the Kern Economic Journal. "For the first time in three years business managers have become pessimistic about the local business outlook," he said. "Several local, regional, national and international factors have contributed to forming these negative perceptions."
Factors contributing to the gloomy business outlook include:
ï The state's massive budget deficits, and cuts targeting education, local government and non-profit organizations.
ï The threat of war against Iraq causing uncertainty in the stock market.
ï Outsourcing of production to Asian countries resulting in a greater flow of cheap imports.
ï Lack of qualified labor.
But there were also some glimmers of hope, Grammy said, including:
ï Low interest rates.
ï Taxable sales in Kern County and Bakersfield held steady and showed increases through the fourth quarter 2002.
ï The price of local crude oil remains high.
The latest issue also includes a detailed look at Kern County's housing market. A story by CSUB economics student Damon Murillo examines local housing demand, and a story by CSUB economics student H. Michael Kunz focuses on the effect of urban development on housing prices.
The Kern Economic Journal is a quarterly publication focusing on local economic trends and developments. The journal provides the community with economic information produced by the CSUB Economics Department. "What we provide is local economic news," Grammy said. "This helps local business people make better decisions. We study local economic trends to determine how the local economy is progressing."
A subscription to the Kern Economic Journal costs $50 per year, and $75 per year for both hard copy and online, including access to the archives. For a free initial copy or more information about any of the studies published in the journal, please call (661) 664-2466, or e-mail Grammy at email@example.com. You can also visit the journal's website at www.csub.edu/kej.