Los Angeles Mayor Eric Garcetti (center) with the UCLA Anderson forecasters. L-R Jerry Nickelsburg, David Shulman, Ed Leamer and William Yu. Photo by Aaron Schasse.
Los Angeles Mayor Eric Garcetti headlined the UCLA Anderson Forecast’s quarterly economic conference this morning, detailing his four point plan for improving the business and jobs climate in the city. Garcetti said he wants to be the “back to basics” mayor, to make City Hall work again and to jump start the economy while putting the recession in the rear view mirror.
The first piece of the mayor’s plan is to take steps to ensure that the skill set of the city’s work force are aligned with the needs of the economy, especially for Los Angeles’ youth. He said that “the city takes responsibility for kids once it hits 3:01,” inferring that after school lets out, the city must find productive activities for its school age children. Mayor Garcetti discussed the city’s recently announced public-private initiative with The Walt Disney Company and Citi Foundation, a summer job program for youths launching later this year called Hire L.A. Youth Summer Jobs. The plan is to create 10,000 jobs for young people 14 to 24 years of age, a figure Garcetti said was “a base, not a ceiling.” The mayor also said that parks will stay open later and that his administration would take steps to see school truancy rates come down.
Garcetti’s second plank is to commit to infrastructure, including public transportation, as much as Los Angeles is committed to job creation. The third piece is Los Angeles’ regulatory environment, which must demonstrate to corporations and industry that the city is “open and ready for business.” The final piece is the marketing of the city itself. Garcetti said that in Los Angeles, people complain publicly about the city’s problems while privately talking about what they love about Los Angeles. The mayor suggested that this paradigm needs to be reversed.
“We have to hustle for business from City Hall,” said Garcetti. “We need to market this town. We need to make sure people know that it’s a global investor…. Things are moving, and we have to make sure they move for everybody.”
The mayor’s talk was preceded by the quarterly economic forecast reports. Senior Economist David Shulman delivered the national forecast. Shulman said that the unseasonably cold weather that plagued most of the country during the first quarter of 2014 distorted the economic picture and that the country was on track for 3% GDP growth beginning this quarter. On the employment front, he said that the country will experience reasonably strong employment gains throughout the duration of the current forecast. “We should have 10 million more jobs by 2016,” Shulman said, noting that the unemployment rate is headed for 5.5%.
According to the forecast, the strength of the economy will be in housing, business investments and consumer spending. There will be modest inflation ahead, rising above 2%, some of the rise coming in the cost of food and perhaps more in the housing sector.
Forecast Senior Economist Jerry Nickelsburg talked about California’s drought, noting that, while the state is experiencing a drought emergency, data show that aridity is not a causal factor in economic growth. In fact, Southern California consumes the same amount of water as 30 years ago, even though population has increased.
“We’ve adapted, we’ve made changes,” said Nickelsburg. “It really doesn’t show up as being something that is a drag on economic growth.”
In his California economic update, Nickelsburg said the state’s economy continues to grow, with nonfarm payroll employment only .6 percent below its previous peak and employment .5 percent above its previous peak. While the housing recovery has legs, it still has a long way to go, he added.
The event, held at the L.A. Live JW Marriott, also featured two panel discussions on job availability and job preparedness. Expert panelists raised a series of additional key issues impacting Los Angeles’ economic recovery, including a strict regulatory environment for businesses, the importance of paid summer internships and job training programs, lowering the recidivism rate of former prison inmates, immigration reform, and trucking and environmental regulations, among others.