54.7 F
Laguna Hills
Tuesday, Mar 19, 2024
-Advertisement-

Fullerton Economists Call For ‘Great Recession’

The effects of the downturn may last a couple years making it a “Great Recession,” California State University, Fullerton, economists said Thursday.

Anil Puri and Mira Farka, professors at the university’s business school, gave their midyear economic forecast at the Hyatt Regency Irvine.

Ongoing problems in the banking sector are likely to make this recession longer than the average 10 months they’ve historically been, they said.

But lessons learned from the Great Depression, when government failed to stimulate the economy effectively, will keep the country from struggling like it did in the 1930s.

The troubled financial industry is “the single biggest roadblock to recovery,” according to Puri.

Locally, the economists expect the county to lose another 15,000 to 20,000 jobs this year.

For the 12 months through March, the county lost 71,900 jobs.

It could take five years for the total number of jobs in the county to recover to its previous peak, like it did in the recession of the early 1990s, the economists said.

“If history is any indication that’s what will happen,” Puri said. “In the 1990s it took six years.”

The median home price in the county could fall another 5% to 7% this year, according to the forecast.

Stabilization in the housing market won’t begin until later this year or early next year. But prices won’t climb again until the overall economy recovers, they said.

The national economy’s gross domestic product will fall 2.2% to 2.4% for 2009. In 2010 the economists predict it will recover by about 1%.

“Things are going to be tough for awhile,” Puri said.

Want more from the best local business newspaper in the country?

Sign-up for our FREE Daily eNews update to get the latest Orange County news delivered right to your inbox!

-Advertisement-

Featured Articles

-Advertisement-
-Advertisement-
-Advertisement-
-Advertisement-

Related Articles

-Advertisement-
-Advertisement-