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ABAG: Bay Area’s economic recovery will be slow

The Bay Area economy “will recover slowly, a mirror of the rest of the nation, stabilizing in 2010 with some recovery in 2011,” Association of Bay Area Governments Economist and Research Director Paul Fassinger told ABAG’s 22nd annual regional economic outlook conference today.

ABAG’s news release said Fassinger reports the region’s income isn’t expected to grow appreciably – 0.3 percent this year, 2.5 percent in 2011 – and the Bay Area’s inflation rate for 2010 and 2011 will hover at 2.5 percent. He estimates about 20,000 more jobs will be lost in 2010, but 2011 will show a modest gain of 8,000 jobs.

State Department of Finance Chief Economist Howard Roth told the ABAG conference, at the Joseph P. Bort MetroCenter Auditorium in Oakland, said the recession may be over but the toll has been “horrific,” and recovery will probably be slow as the unemployed seek jobs and people try to get their finances in order. He’s concerned that another wave of less-than-prime adjustable-rate mortgages will reset between 2010 and 2012, perhaps leading to a renewed foreclosure and housing-market crisis.

ABAG Senior Regional Planner Hing Wong reported the region’s consumer spending remains weak; he expects retail sales will grow by only 0.4 percent this year and 2.2 percent in 2011. That’ll mean a nominal taxable sales growth of 1 percent in 2010 and 1.9 percent in 2011.

DataQuick Information Systems analyst Andrew LePage reported some indicators suggest the housing downturn has slowed, with potential for a “fledling recovery.” Vallejo and Antioch had the highest number of foreclosures in 2009 – 1529 and 1455 homes, respectively – while Sausalito and Los Altos showed the lowest foreclosure numbers, five and eight homes, respectively.

Josh Richman

Josh Richman covers state and national politics for the Bay Area News Group. A New York City native, he earned a bachelor’s degree in journalism from the University of Missouri and reported for the Express-Times of Easton, Pa. for five years before coming to the Oakland Tribune and ANG Newspapers in 1997. He is a frequent guest on KQED Channel 9’s “This Week in Northern California;” a proud father; an Eagle Scout; a somewhat skilled player of low-stakes poker; a rather good cook; a firm believer in the use of semicolons; and an unabashed political junkie who will never, EVER seek elected office.