The Fermanian Business & Economic Institute (FBEI) at Point Loma Nazarene University (PLNU) held its annual Economic Outlook Forum at the Hyatt Regency La Jolla on Dec. 5. Dr. Lynn Reaser, Chief Economist at FBEI, provided an overview of 2014 and then offered insights about the 2015 economic forecasts for the global, national, state and local economies.
When reviewing 2014, Dr. Reaser noted that the Eurozone, Japan and China experienced economic slowdowns. The United States continued to recover from the Great Recession, and consumers benefited from oil prices plummeting from over $100 a barrel to $80 a barrel. In San Diego specifically, the regional labor market added approximately 34,000 jobs, and the unemployment rate dropped to 5.8 percent, significantly lower than the 6.5 percent predicted in last year’s Economic Forum. Dr. Reaser provided an economic report card, indicating that the overall grade for the world, national, state and local economies was a “B” for 2014.
In her 2015 forecast, Dr. Reaser predicts that world economy will experience moderate growth, but developing markets such as Mexico are poised for strong economic growth due to solid fiscal and monetary policies—if the government can maintain domestic stability. Here at home, the U.S. real Gross Domestic Product (GDP) is expected to grow 2.8 percent in 2015. With continued growth in the U.S. economy, the Federal Reserve is likely to implement the first interest rate hike in June 2015.
Dr. Reaser noted that California’s economy is driven by technology, with nearly 60 percent of all U.S. venture capital funding invested in the state. California is predicted to experience further growth, adding approximately 325,000 jobs in the next year.
Locally, San Diego has outperformed the nation in employment growth for the third consecutive year in 2014, and will add 35,000 jobs to the region by the end of 2015. Consumer spending and confidence have also increased. Dr. Reaser predicts that jobs will be added to all major industries in San Diego, lowering the region’s unemployment rate from its current 5.8 percent to 5.4 percent by the end of 2015.
Dr. Reaser has been in her current position at FBEI for four years and also serves as the Chief Economist for the Council of Economic Advisors for California State Controller John Chiang.