Source: U.S. Dept. of Commerce, Bureau of Economic Analysis; National University System Institute for Policy Research
San Diego's economy is flatlining below the state average
"San Diego may once again be leading the rest of the state and nation into recession, as we did ten years ago," says Kelly Cunnngham, economist at National University System.
The federal Bureau of Economic Analysis has released its annual update of gross domestic product in the nation's metropolitan areas. The bureau reduced its previous estimate of San Diego's 2016 economic growth from a bit over 2 percent to almost zero.
"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."