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Orange County’s economy will continue to add jobs next year and increase total employment here by 1.8% despite signs of headwinds, according to a forecast from Chapman University’s Argyros School of Business and Economics in Orange.

That’s about 26,000 new jobs for 2013—similar to this year’s pace—and would take OC’s employment total 1,418,709.

Economists at Chapman’s A. Gary Anderson Center for Economic Research expect OC to outpace the state and the U.S. in job gains. The forecast, authored by school President James Doti with Anderson Center Director Esmael Adibi, estimates a 1.6% gain for California and 1.4% for the U.S.

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The potential for cuts in government spending and tax hikes, which could come next year if Congress and President Barack Obama fail to avoid the "fiscal cliff," tamped down the outlook.

The report said Orange County’s job gains will primarily come from the services and construction sectors, while government, retail and manufacturing and others are likely to cut jobs or hire at lower rates.

The services sector—which includes leisure and hospitality along with professional and business services, among others—is expected to add 15,603 workers next year for a 2.3% increase. The gains will bring the sector to about 680,000 jobs total, making up for about 48% of Orange County’s entire work force.

Construction employment is likely to expand by 2.2%, thanks in part to a “rebound in construction spending,” which has been helped by a steady increase in the housing market. Chapman economists expect about 1,477 workers to be added throughout the year.

The total number of federal civilian government jobs will decrease by 1.2%, according to the report, with a loss of 138 jobs for a total of 11,085.

OC’s home prices will increase next year at a faster clip than they have throughout 2012, according to the Chapman forecast. Economists expect the median price of a single-family house in OC to post an increase of 4.2% for this year, with a 6.8% jump in 2013.

OC also has seen an increase in home sales and a sharp decline in notices of defaults, the report said.

Total taxable sales in OC are expected to grow at 5.4% next year, while increased sales and payroll taxes are expected to be a primary concern for businesses.