|November 23, 2004
Mike Stepanovich, 661/664-2456 or
Kern County’s economy improved slightly in the third quarter 2004, despite slight dips in the business outlook index and consumer sentiment, according to the latest issue of the Kern Economic Journal, published by California State University, Bakersfield. Researchers who study the county’s economy said the dips were so slight that they were inconsequential and that both businesses and households remained optimistic about local economic conditions.
What researchers found encouraging was that the county’s expanded at a 2.3 percent rate, and labor productivity increased. Additionally, the county’s unemployment rate nearly a full percentage point to 10.7, with non-farm employment increasing at a 2 percent annual rate.
A concern was the decline in housing affordability. The median housing price appreciated by 10.7 percent in the third quarter, which dropped the county’s affordability index to 39 percent. This means that only two out of five Kern County residents can afford to purchase a home.
The Business Outlook Index declined slightly from 138.9 in the second quarter to 136.8 in the third quarter. “These numbers indicate that business managers remain optimistic about local business conditions,” said Abbas Grammy, CSUB economics professor and publisher of the journal. “While the index showed a slight decline, it has risen 32 points over the past four quarters. This is very good news for Kern County.”
The Bakersfield Consumer Sentiment Index attained a 115 value in the third quarter, exactly equaling the average value of the quarterly index since its inception in 1999. While the quarterly figures match the historic average, survey respondents had mixed views on the local economy, said Mark Evans, interim dean of CSUB’s Extended University and an economics professor. “Recent trends were less robust, while future expectations were more optimistic than usual,” Evans said. He said consumers expressed concern over rising fuel costs, higher health insurance costs and the re-routing of Highway 58 bypassing Mojave.
Other trends reported in the Journal that reflect Kern’s economy:
- Personal income and labor productivity in the county continue to rise, Grammy reported.
- The median sales price of all homes in Kern County soared another $17,500 in the third quarter to $180,330. Since the third quarter of last year, the county’s median price has appreciated $51,330, or 39.7 percent.
- Crude oil prices continue at record and near record highs. The average price of San Joaquin Valley heavy crude, the area’s benchmark oil, climbed $3.35 per barrel in the third quarter to $35.09. The average price of a barrel of local crude is up more than $10 from a year ago.
The latest issue of the Kern Economic Journal also includes a detailed look at the economic impact of Tejon Ranch and of CSUB on the local economy, and a brightening outlook for economic development in Kern County.
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 $60 per year for the print issue, $80 for the electronic issue, including archives; and $100 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.