Explaining Southern California's economy

Could California handle a downturn in exports?

Brad Racino

The Port of Long Beach, together with the neighboring Port of Los Angeles, are critical hubs for California exports.

It's not really correct to do this, but you can compare the economy of California to the economy of an entire country. If California were a country, it would be the world's ninth largest, at about $2 trillion, according to some data compiled by the LAEDC. This sounds great — Bravo, Golden...Nation! — but as we learned from the most recent UCLA Anderson Forecast, released this morning, this means that global economic events can affect California more than other U.S. states, and even entire U.S. regions.

This from Anderson Forecast economist Jerry Nickelsburg's contribution to the report, "California Exports: How Much Do They Matter?", in which he considers the impacts, both positive and negative, that exports have on the state economy:

How sensitive is the California economy to changes in the world economy? ...Chinese growth, if not negative, is in retreat.  In many parts of Europe, growth is indeed negative as a double dip recession has set in and the future of the Eurozone remains a risk of our U.S. forecast.  As it turns out, California has considerable exposure to China and Europe.  Together they make up one quarter of all direct exports from the state.