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ECONOMIC DEVELOPMENT CORP. FORECASTS 1992 ECONOMY AND INDUSTRY OUTLOOK

ECONOMIC DEVELOPMENT CORP. FORECASTS 1992 ECONOMY AND INDUSTRY OUTLOOK
 LOS ANGELES, Jan. 28 /PRNewswire/ -- A sluggish recovery for California's economy starting in the second half of 1992, but little or no improvement for the Los Angeles five-county area's economy during the year was forecast by the Economic Development Corp. (EDC) of Los Angeles County. "There is restructuring in several major industries, including defense-related aerospace, construction and real estate, financial services, business and management services and retailing, and the net result should be no change in the five-county area's gross product in 1992, after a 2.1 percent slide in 1991," said Jack Kyser, chief economist for the EDC. "In addition, there will be the shut-down of the General Motor's plant in Van Nuys, and there is the potential for a strike in the motion picture/TV production industry. Add in budget problems for all levels of government, and you have a very volatile situation for the next few years."
 A big problem for the Los Angeles area is the continuing sharp decline in defense-related aerospace employment. The EDC forecast estimates a loss of 30,000 jobs in 1991, and forecasts that another 30,000 will disappear in 1992. "From the peak employment of 423,500 in 1987 through 1992, 113,500 high-paying jobs will have been lost in aerospace in the Los Angeles area, and the reemployment prospects for many of the displaced workers is not bright," observed Kyser. "There is a growing commercial aspect to the area's aerospace industry, but it will not be able to quickly replace the jobs already lost."
 The EDC forecast calls for a 1.2 percent drop in nonfarm employment in the Los Angeles five-county area in 1992, after a 3.4 percent decline in 1991. The latter figures are based on the California Department of Finance Interim Employment series. Personal income in the five-county area should increase 2.9 percent in 1992, while inflation should ease to 3.0 percent. "There will be better news for the battered retail industry in 1992, with sales up 2.8 percent compared with 1991's grim 5.8 percent decline," continued Kyser. "However, competitive pressures will remain intense, and there could be more store shut-downs during 1992.
 Industries with favorable prospects in 1992 according to the EDC forecast include: engineering and environmental services, apparel design and manufacturing, international trade, health care and transportation-related infrastructure. "The Los Angeles five-county area is rapidly developing a significant mass transit industry, and there are a lot of business opportunities here," Kyser pointed out.
 The EDC forecast and industry outlook for the Los Angeles area called for an improvement in the business climate of both the state and Los Angeles area, the development of the capability of nurturing new industries and the taking control of the area's image. "The implication found in the economic development brochures of many states is that California/Southern California have very little to offer business," said Kyser. "California and Los Angeles still have a formidable array of advantages, but we need to communicate them more forcefully."
 Copies of the EDC economic forecast and industry outlook are available for $15.
 -0- 1/28/92
 /CONTACT: Jack Kyser of the Economic Development Corp., 213-462-5111/ CO: Economic Development Corp. ST: California IN: SU:


DM-SE -- LA028 -- 4497 01/28/92 19:13 EST
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Publication:PR Newswire
Date:Jan 28, 1992
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