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San Diego the next recession engine?

Federal data show startling downward revisions


Wednesday, September 27, 2017

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The slowdown of the economy since 2013 has been much worse than formerly realized," says Cunningham. Also, the revisions show that the late 2007/early 2009 Great Recession hit San Diego harder than previously realized.

Since 2013, San Diego has been significantly lagging the state and nation in economic and employment growth, says Cunninngham, and "San Diego job growth is slowing considerably so far in 2017.

Cunningham had estimated the local economy would only grow at 0.2 percent this year, but with this year's job growth lagging 2015 and 2016, the economist thinks his estimate perhaps should be even lower — "maybe sinking negative into recession?"

"I attribute San Diego's sputtering economy in large part to the downsizing of the military," says Cunningham. "Military employment in San Diego peaked in 2009 at 112,000. As of 2015 (the latest numbers available), the number is 98,828 active-duty military personnel based here. Also, the unreasonably high cost of housing may be driving people away."

Cunningham also thinks the high minimum wage "may be causing small business to go away."