Business & Economy

Fits and Starts: Central Valley economy is 'off the floor, ... still on its knees'

Tom Barcellos, owner and operator of T-Bar Dairy stands in front of his Holstein herd in Porterville, Calif. (Tulare County)
Tom Barcellos, owner and operator of T-Bar Dairy stands in front of his Holstein herd in Porterville, Calif. (Tulare County)
Julia Mitric/ Capital Public Radio
Tom Barcellos, owner and operator of T-Bar Dairy stands in front of his Holstein herd in Porterville, Calif. (Tulare County)
Holstein dairy cows are housed in a T-Bar Dairy enclosure in Porterville, Calif.
Julia Mitric/ Capital Public Radio
Tom Barcellos, owner and operator of T-Bar Dairy stands in front of his Holstein herd in Porterville, Calif. (Tulare County)
Adam Hill, who works for Robin's Envirovac in Bakersfield, Calif., runs a maintenance check.
Julia Mitric/ Capital Public Radio
Tom Barcellos, owner and operator of T-Bar Dairy stands in front of his Holstein herd in Porterville, Calif. (Tulare County)
Oil rigs at the Kern River Oil Field in Bakersfield, Calif.
Julia Mitric/ Capital Public Radio
Tom Barcellos, owner and operator of T-Bar Dairy stands in front of his Holstein herd in Porterville, Calif. (Tulare County)
Kern Ice & Cold Storage on Union Avenue, in Bakersfield, Calif.
Julia Mitric/ Capital Public Radio


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The Great Recession saw many casualties in California's great Central Valley:

Five years later, jobless rates in some Central Valley counties are starting to dip under 10 percent after reaching as high as 16 percent. The public sector is adding jobs again, and the housing market is starting a comeback. 

"It's off the floor," said economist Jeff Michael with the University of the Pacific. "It's still on its knees. It's lifting a little bit, and they've seen some recovering values, and that's helping the broader economy a little bit, too." 

Dairy farmer Tom Barcellos recalled the rough times. "It was a bloodbath," said Barcellos, who owns T-Bar Dairy in Porterville. "Some people who were on a rented place, all they had was equity on their cows. Those were the ones that hurt the worst, ... the ones that actually went out of business first. And, unfortunately, some hung on until they had nothing. Others saw it coming and sold out."

Barcellos survived the crisis because, in addition to his 1,500 cows, he has land. So when feed prices skyrocketed and milk prices sank, he cut costs by growing feed himself.

Five years later, on a balmy October afternoon, a worker drives a vehicle along the edge of the corral. He's pushing fresh feed toward T-Bar's herd.

Milk prices are strong, feed costs have fallen a bit. But there's still one thing that has Barcellos worried. "Everything is wonderful except the drought, except the water," Barcellos said.

Oil leads Bakersfield's recovery

The Sacramento region has seen its median home price rebound about halfway to where it was at the peak of the housing bubble.

In Bakersfield, another industry is jump-starting the economic recovery: oil.

At sunrise, the Kern River oil fields are cool and surprisingly quiet. In the work yard behind Robin's Envirovac, a small business that cleans up oil spills, a crew picks up work orders and runs maintenance checks on a very odd piece of equipment called a Guzzler. It sucks up dirt and water without damaging oil or power lines. 

For company supervisor Vince Nigro, there's never a dull moment working in the oil fields. "It's a little bit of everything. It's a little bit complex. It's a little difficult. It's dangerous," Nigro said.

The oil industry is leading Bakersfield's recovery, thanks to new exploration and investment. And for Nigro, it's a reliable job — no small thing.

He knows plenty of folks in construction who aren't landing steady work. "You know, they'll be working one day and next day, hey, everybody's getting laid off," Nigro said. "It's not booming like oil fields or work in the hospital or anything like that. Those are the two best fields to be in here in Bakersfield."

As for the future here? "Um," he said with a laugh. "It's a good town to move to if you're looking for work. You have the oil fields here, so there's a lot of opportunities in the oil field. I'd tell people, 'If you're looking for work, come to Bakersfield!'"

Which just goes to show, even parts of the Central Valley are seeing new economic life.

This story is part of Fits and Starts: Stories of Recovery in California Cities, a partnership between KPCC and Capital Public Radio. You can read other parts of the series here. Please let us know what you think in the comments below, on our Facebook page or on Twitter (@KPCC).