Santa Clara County Economic Forecast

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Santa Clara County Economic Forecast Santa Clara County is the largest county in the San Francisco Bay Area. The northwest portion of the county, known as Silicon Valley, is the home to many leading computer and electronics companies. The county thrived in the late 1990s when technology was booming, but since the dotcom bust of 2000 the county has been slow to recover. Santa Clara County has a population of 1.76 million people and more than 840,000 wage and salary jobs. The per capita income in the county is $46,556, and the average salary per worker is the highest in the state at $77,560. The median family income is also highest in the state at $105,500. Employment growth in the composite Northern California area was weak in 2004, due primarily to the sluggish Bay Area economies. In fact, employment in the Bay Area declined by 1 percent last year. In 2004 almost 15,000 more jobs were lost in Santa Clara County, representing the fourth straight year of job losses in the county. Non-farm employment declined by 1.7 percent last year. However the unemployment rate fell to 6.6 percent in 2004. Few sectors created jobs in Santa Clara County in 2004. In fact, only education and healthcare services, ﬁnancial activities, leisure services, and wholesale trade created jobs last year. Manufacturing and professional services experienced the largest declines in employment. Each sector lost over 4,000 jobs last year. The population continues to grow in Santa Clara County, and the growth rate has risen to 1 percent per year. The fastest growing cities in the county are Gilroy and Morgan Hill, which grew 3.4 and 2.2 percent, respectively. The largest city in the county, San Jose, grew 0.7 percent last year. Employment growth will remain slow in Santa Clara County through 2006. In 2007 and beyond the county will return to healthier levels of job creation and population growth. thousands of jobs 60 40 20 0 -20 -40 -60 -80 -100 -120 90 95 00 05 10 15 20 25 �� 1990 - 2025 constant 2004 dollars per person 68,000 63,000 58,000 53,000 48,000 43,000 38,000 33,000 28,000 90 95 California Real Per Capita Personal Income 1990 - 2025 Santa Clara County forecast 00 05 10 15 20 25 Forecast Highlights • Virtually no job growth is expected in Santa Clara County in 2005. In 2006 jobs are forecast to be created for the ﬁrst time since 2000. Over the next ﬁve years, the annual growth rate is expected to average 1.9 percent per year. • Average salaries adjusted for inﬂation are currently well above the California state average, and will remain so over the foreseeable future. Real average salaries are forecast to rise an average of 1.8 percent per year over the next 5 years. • Over the next ﬁve years, the momentum for employment growth is in professional services. This sector alone will account for 57 percent of all jobs created in the county over the next ﬁve years. 1 • The population will continue to grow at a rate of 1 percent in 2005. Annual growth in the 2005 to 2010 period is forecast to increase slightly to an average of 1.1 percent per year. • Net migration is expected to remain negative in 2005. Over the next ﬁve years net migration is expected to turn positive, with an average of 2,300 net migrants entering the county per year. • Real per capita incomes increase at a rate of 2.7 percent in 2005. Over the next ﬁve years real per capita incomes are forecast to increase 2.6 percent per year. • Industrial production is expected to increase a scant 0.4 percent in 2005. Over the next ﬁve years the growth rate of industrial production is forecast to increase, averaging gains of 3.3 percent per year. Santa Clara County Economic Forecast 1995-2004 History, 2005-2025 Forecast Net Population Migration (people) (people) 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 1,573,500 1,599,300 1,626,200 1,650,400 1,665,600 1,692,759 1,709,188 1,720,757 1,732,637 1,749,365 1,767,328 1,786,384 1,806,519 1,827,527 1,848,686 1,870,182 1,891,895 1,913,745 1,935,589 1,957,073 1,977,951 1,998,315 2,018,347 2,038,049 2,057,974 2,078,090 2,098,709 2,119,585 2,140,436 2,161,181 2,182,145 -7,025 8,231 9,261 6,402 -2,145 9,347 -2,354 -6,728 -6,703 -1,773 -113 1,008 2,051 2,787 2,765 2,925 2,998 3,065 3,075 2,824 2,421 2,150 2,027 1,815 1,909 1,831 1,967 1,941 1,845 1,777 2,098 Registered Vehicles (millions) 1.31 1.35 1.30 1.39 1.40 1.45 1.47 1.47 1.42 1.46 1.46 1.47 1.49 1.51 1.53 1.56 1.58 1.60 1.63 1.65 1.67 1.69 1.71 1.73 1.75 1.77 1.79 1.82 1.84 1.86 1.88 Households (thousands) 538.1 541.4 544.4 551.5 559.2 565.9 570.7 576.7 582.3 586.9 591.6 596.9 602.5 607.5 612.4 616.8 621.4 626.0 630.9 635.8 640.4 644.7 648.8 652.8 657.1 661.2 665.1 669.1 673.1 677.4 681.4 New Homes Total Taxable Personal Real Per Inﬂation Rate Real Farm Permitted Sales Income Capita Income (% change Crop Value (homes) (billions) (billions) (dollars) in CPI) (millions) 3,484 7,501 8,810 7,526 7,010 7,054 5,960 4,513 7,490 5,504 5,781 5,958 5,400 5,210 4,700 4,958 4,942 5,218 5,272 4,879 4,661 4,353 4,347 4,590 4,394 4,160 4,344 4,261 4,591 4,352 4,667 $22.6 $25.3 $27.0 $27.5 $30.3 $37.3 $32.1 $27.5 $27.1 $28.9 $35.2 $38.9 $42.0 $45.1 $47.9 $50.9 $54.2 $57.6 $61.1 $64.5 $67.7 $70.9 $74.2 $77.4 $80.8 $84.1 $87.5 $91.0 $94.6 $98.4 $102.6 $50.2 $54.2 $60.0 $64.9 $73.0 $91.4 $84.0 $78.0 $77.7 $81.4 $86.4 $91.6 $96.9 $103.5 $110.4 $118.2 $126.7 $135.5 $144.2 $152.9 $161.4 $169.9 $178.5 $186.9 $195.7 $203.9 $212.3 $221.3 $230.7 $240.8 $251.8 $41,818 $43,423 $45,736 $47,200 $50,542 $59,559 $51,436 $46,690 $45,354 $46,556 $47,809 $48,853 $49,809 $51,262 $52,775 $54,408 $56,097 $57,648 $58,950 $60,074 $60,871 $61,585 $62,287 $62,867 $63,440 $63,768 $64,083 $64,438 $64,721 $65,149 $65,725 2.0 2.3 3.4 3.2 4.2 4.5 5.4 1.6 1.8 1.2 1.7 2.7 2.6 2.6 2.5 2.7 2.7 2.8 2.9 2.9 3.1 3.0 2.9 2.7 2.8 2.7 2.6 2.6 2.7 2.7 2.7 209.4 189.1 189.3 191.9 203.0 332.0 301.7 263.4 243.9 226.6 220.1 215.3 209.9 207.2 202.6 197.9 195.1 192.2 188.5 185.5 182.3 179.0 177.9 175.8 173.5 171.3 170.9 169.1 168.8 166.5 164.4 Real Industrial UnemployProduction ment Rate (billions) (percent) 20.8 22.5 24.6 25.4 26.5 31.0 24.2 21.3 20.9 20.9 21.0 21.2 22.1 23.1 23.9 24.7 25.4 26.4 27.6 29.0 30.3 31.4 32.6 33.7 34.9 36.3 37.5 38.2 38.8 39.5 40.6 5.0 3.6 3.0 3.2 3.0 2.0 4.6 8.5 8.2 6.6 6.0 5.7 5.4 5.0 5.0 4.9 4.8 4.7 4.6 4.7 4.9 5.0 5.2 5.2 5.0 4.9 4.6 4.4 4.4 4.5 4.3 percent change Population Growth 1990 - 2025 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 inmigrants minus outmigrants �� 1990 - 2025 10,000 7,500 5,000 2,500 0 -2,500 -5,000 -7,500 -10,000 90 95 00 05 10 15 20 25 90 95 00 05 10 15 20 25 2 Santa Clara County Employment Forecast 1995-2004 History, 2005-2025 Forecast Total Wage Manufac- Transportation Wholesale & Financial Professional Health & & Salary Farm Construction turing & Utilities Retail Trade Activities Services Information Education Leisure Government -------------------------------------------------------------------------------employment (thousands of jobs)--------------------------------------------------------------------------------------1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 836 885 932 961 977 1,035 1,008 907 858 843 842 849 864 885 904 925 946 968 990 1,009 1,025 1,039 1,053 1,064 1,077 1,089 1,102 1,115 1,127 1,138 1,153 4.50 5.14 5.07 5.15 5.28 5.01 4.62 4.47 4.17 3.88 3.86 3.83 3.79 3.78 3.75 3.72 3.71 3.69 3.67 3.65 3.63 3.61 3.60 3.59 3.58 3.57 3.56 3.55 3.55 3.54 3.53 28.7 32.5 36.3 41.1 44.6 47.4 47.8 42.3 38.8 37.5 36.3 36.1 35.9 36.0 36.0 36.1 36.4 36.8 37.2 37.4 37.3 36.9 36.6 36.6 36.3 36.1 35.9 35.8 36.0 35.9 36.0 223.0 237.8 247.2 246.1 234.9 251.7 240.6 201.2 177.0 170.8 169.2 168.4 167.2 166.3 164.7 163.5 162.6 162.4 164.0 165.6 166.4 167.7 168.9 168.0 168.1 168.0 168.6 168.5 167.8 166.8 168.3 14.9 16.2 16.7 16.9 17.3 17.5 16.3 15.0 14.2 13.4 13.7 13.9 14.3 14.7 15.0 15.4 15.6 15.9 16.2 16.4 16.5 16.7 16.9 17.1 17.4 17.7 18.0 18.3 18.6 18.8 19.1 112.2 119.2 124.3 126.2 128.9 132.9 128.9 119.3 114.4 114.9 116.2 118.5 121.1 124.0 126.6 129.1 131.5 133.7 135.8 137.6 139.0 140.3 141.5 142.7 144.1 145.4 146.8 148.2 149.4 150.5 151.8 30.4 31.4 32.3 33.8 34.2 34.0 35.2 35.0 34.8 34.9 35.1 35.5 35.8 36.1 36.5 36.7 37.0 37.4 37.8 38.2 38.5 38.8 39.1 39.3 39.5 39.7 39.9 40.1 40.3 40.5 40.6 147.0 162.8 181.3 196.7 207.1 225.8 210.0 173.2 164.3 160.2 158.0 160.9 168.7 179.0 189.9 201.9 214.3 226.5 237.5 247.0 255.1 261.1 266.4 271.1 276.0 280.7 285.4 290.1 294.6 299.2 303.8 24.6 26.0 28.1 29.0 32.5 42.7 41.9 34.2 31.0 30.7 32.2 33.1 34.6 36.8 39.2 41.6 43.8 45.8 47.5 49.0 50.3 51.6 53.0 54.4 55.6 56.6 57.7 58.7 59.9 61.2 62.7 77.6 78.5 81.4 84.2 85.5 85.2 89.8 91.1 92.7 93.5 95.2 96.8 99.5 102.5 104.6 106.6 108.6 110.5 112.3 114.2 116.1 118.1 120.1 122.4 124.8 126.8 129.2 131.9 134.5 137.2 139.8 61.0 62.2 64.6 66.7 68.6 71.4 72.0 67.4 67.5 67.7 68.3 69.1 70.2 71.5 72.8 74.0 75.2 76.3 77.5 78.4 79.2 79.9 80.5 81.1 81.9 82.6 83.5 84.3 85.0 85.6 86.2 87.8 87.4 88.5 88.9 91.4 94.5 94.6 98.1 94.8 91.8 89.7 88.7 88.3 88.4 88.9 89.6 90.4 91.4 92.4 93.5 94.6 95.8 96.9 98.1 99.3 100.5 101.8 103.0 104.3 105.7 107.1 thousands of jobs 260 250 240 230 220 210 200 190 180 170 160 150 90 95 �� 1990 - 2025 thousands of jobs 320 �� 1990 - 2025 300 280 260 240 220 200 180 160 140 120 00 05 10 15 20 25 100 90 95 00 05 10 15 20 25 3 percent change �� 1990 - 2025 thousands of vehicles Number of Registered Vehicles 1990 - 2025 15 10 5 0 1,900 1,800 1,700 1,600 1,500 -5 -10 -15 1,400 1,300 1,200 90 95 00 05 10 15 20 25 90 95 00 05 10 15 20 25 average annual percent change 20 �� 1990 - 2025 inflation adjusted index (1990=100) 225 200 Industrial and Farm Production Indices 1990 - 2025 15 10 5 0 -5 -10 -15 -20 90 95 00 05 10 15 20 25 100 75 90 95 Farm 00 forecast 175 150 125 Industrial 05 10 15 20 25 units permitted �� 1990 - 2025 thousands of constant 2004 dollars per worker Real Earnings Per Worker 1990 - 2025 9,000 8,000 7,000 6,000 100 90 80 Santa Clara County 70 5,000 4,000 3,000 2,000 60 50 California 40 90 95 00 05 10 15 20 25 forecast 90 95 00 05 10 15 20 25 4