Economies need to grow to be healthy. Typically, when a country, state or region emerges from a recession, the story is one of rapid growth, and businesses and consumers make up for lost ground.
But in the aftermath of the Great Recession, the story is different. Southern California in particular is taking its time to fully recover.
But first, some context: Economists say that job growth in Los Angeles County in the second half of 2012 beat growth for the nation as a whole. Unfortunately, the unemployment rate in L.A. County is still above 10 percent, and it isn’t expected to drop below that psychologically important barrier until 2014.
Robert Kleinhenz, Chief Economist at the L.A. County Economic Development Corporation, said that it could take a further year for the region to come back to what he considers the natural level of long-run unemployment: 7.5 percent.
"The fact remains it’s going to be probably 2015 before we return to peak levels of employment that we experienced prior to the recession," said Kleinhenz.
"Yes, we’re applauding the growth that we anticipate in 2013 and 2014, and we want more. The problem is that both locally and nationally the growth rates really are about half of what we really need to bring the labor market back in to its long run normal position. That’s one of the reasons why this recovery is taking about twice as long."
Kleinhenz would prefer jobs growth closer to 4 percent, which he says could lower the L.A County unemployment rate to 7-and-a-half percent in 18 months.
But he doesn’t see any quick solutions — no way to turbocharge the region's growth. Plus, there’s another challenge: The way we work has changed, with technological advancements increasing productivity and making it harder for people who lost their jobs before the recession to find a new one.