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Economist: It’s not over yet

Another long road to recovery’ was predicted for 2010 by keynote speaker at VIA’s business-to-busine

Posted: June 11, 2009 7:10 p.m.
Updated: June 12, 2009 4:55 a.m.
 
Los Angeles County isn't out of the economic woods yet, an economist told local business professionals Thursday.

The county unemployment rate in May was 11 percent - the highest since 1982 - and may skyrocket past 12 percent through 2010, said Carrie Rogers, vice president of business assistance and development for the Los Angeles County Economic Development Corp.

The national unemployment rate is currently about 9.4 percent, she said.

Rogers was the keynote speaker for the Valley Industrial Association's monthly luncheon, which coincided with VIA's business-to-business industry show this week.

While county unemployment dropped four-tenths of a percent between April and May, Rogers said it is expected to climb.

The three industries hardest-hit in Los Angeles County are construction, manufacturing and retail, Rogers said.

The current recession began in December 2007, and she said economists expect it to bottom out this year before the economy begins to improve with "weak growth" in 2010.

Rogers said this is the longest-running recession since World War II.

"We're going to have a rather long road to recovery," she said.

Turning to Hollywood, she said the filming industry is feeling the effects of so-called runaway productions, the term for film or TV productions lured to other states because of tax incentives.

As an example, Rogers said 120 feature films - at a typical cost of about $70 million - are set to be completed in 2009. Of those 120, she said only three will be done in Los Angeles County.

All the news isn't doom and gloom, though, according to Rogers.

She noted that Santa Clarita has seen a 13-percent increase in filming days this year.

Indeed, filming ranks high in the city's recently approved 21-point economic development plan. The $150,000 film incentive program recognizes three tiers of eligibility.

The first level of the incentive program eliminates nearly all permit fees for Santa Clarita-based productions that do at least 65 percent of their principal photography in Santa Clarita. A production company in the first tier could reportedly save up to $20,000 annually through the incentive program.

In the second level of the program, the city will subsidize basic permit fees for production companies that film more than six times a year in Santa Clarita.

The third level of the plan rebates half the transient occupancy tax collected when productions require local hotel stays. Within city limits, the tax is 10 percent.

Rogers also said the LAEDC has developed a business outreach program, keeping in mind that representatives from more than 40 states "are visiting California and Los Angeles County trying to take business.

"We're the state's economic driver. The impact is going to be felt far and wide when something happens to Los Angeles County."

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