3.3 INDUSTRY AND LABOR FORCE FORECAST

The State of California Employment Development Department (EDD) prepares projections for employment by geographic area within the State. Table 3.3-1 contains employment wage and salary projections for the Yuba City Metropolitan Statistical Area between 1990 and 1997. This table, as well as the following text, has been extracted from EDD's "Annual Planning Information" series . This material was prepared for the bi-counties area to provide a more accurate picture of the local economy. Employment is reported by place of work.

Note: The highlighted forecast numbers may be overstated. Since the forecast was made, a major fruit canning facility employing approximately 1,100 people, had closed. Please take caution when using industry employment numbers highlighted in bold print on the following table and its interpretation on the following narrative.

TABLE 3.3-1
YUBA CITY MSA
1997 WAGE AND SALARY FORECAST

Source: "Annual Planning Information, Yuba City, 1994", Employment Development Department

Employment in the Yuba City Metropolitan Statistical Area (MSA) is expected to expand by 12.8 percent from 1990 to 1997. However, growth will occur at a slightly slower pace early in the projection period, as a result of sluggish economic conditions. Then it picks up momentum towards the end of the period. Overall, the wage and salary employment levels are projected to rise moderately in all industry divisions, led by growth in government, retail trade, services, and manufacturing industry divisions.

Employment in agriculture, the third largest industry division, is expected to edge upward by 5.1 percent during the outlook period. However, possible future drought conditions could possibly affect the industry division, slowing expected expansion of agricultural payrolls.

Employment in the mining and construction division is projected to grow by about 150 jobs between 1990 and 1997. The mining component is expected to expand (in Yuba County) in the gold ore and construction sand and gravel industries; the latter plays a crucial role in the construction division. Most future growth in the construction component will be centered in general building and special trade contractors . These industries perform activities associated with residential construction and gains are generally attributed to area population growth. As families continue to relocate to the Yuba City MSA to find lower living and housing costs, area construction should continue to expand at a steady rate.

Employment in the manufacturing division is expected to grow by 750 jobs over the projected period, an overall growth rate of 22.2 percent. This exceeds the total area industry increase of 12.8 percent and makes manufacturing the fastest growing among all the area's divisions. Most new jobs in manufacturing will be focused in the food processing industry, continuing the area's strong history of producing and processing agricultural products. Also, slight losses are forecast (in Yuba County) in the lumber and wood products industry. This reflects an overall trend in Northern California, caused primarily by increased environmental controls by both public and private concerns.

The transportation and public utilities industry division is expected to grow slightly during the projected period. Growth will be concentrated equally in both the local and inter-urban transportation, trucking and warehousing industries. The utilities and sanitary services industry is projected to show the largest loss within the division, dropping 75 jobs during the seven year period.

The wholesale trade division is expected to grow slightly during the forecast period. Growth will be concentrated equally in local and inter-urban transportation, and trucking and warehousing.

Retail trade is expected to expand by 1,025 jobs, a healthy growth rate of 15.1 percent between 1990 and 1997. This growth is supported by equal employment increases in eating and drinking places, and miscellaneous retail stores, which include lumber and building materials, drug, clothing, sporting goods, and electronic goods stores. These advancements in employment are mainly a result of increased demand for retail goods caused by expansion of the area population.

The finance, insurance, and real estate division is expected to expand by 200 jobs over the forecast period. Most new job growth will be concentrated in establishments providing health insurance, banking services, and real estate services. Job increases in this industry division are directly related to population growth in the area.

During the projected period, the services division is expected to experience substantial job gains. Within the Yuba City MSA, health services will gain the most jobs, increasing by 425. This increase is not only a response to the demand for services by a rising population, but also the anticipated expansion of existing medical facilities and an upgrading of the medical services offered in this area. Moderate gains are also expected for the remaining service industries, especially those which provide business, personnel, lodging and repair services.

Government, the largest division in terms of employment, is expected to increase by 1,200 jobs between 1990 and 1997. This represents the largest absolute job gain among the area's industry divisions. The local government component will generate most of the new jobs, primarily in education, while state government will experience moderate growth and the federal component will remain stable.

3.4 RETAIL SALES

The local portion of the sales tax, one-and-one-quarter percent of taxable sales (this was changed from one percent in 1991), is distributed to the local jurisdictions based upon the location of the transaction that generates the tax. If the transaction occurs within a city, then the city receives one percent of the sales tax while one-quarter percent is given to the County. If the transaction occurs within the unincorporated area of the County, then the County receives the entire one-and-one-quarter percent sales tax revenue. The extra one-quarter percent sales tax revenue received by the County is earmarked for police and fire protection and is, therefore, not reflected in Tables 3.4-1 and 3.4-2.

Table 3.4-1 contains a summary of taxable sales totals by Sutter County jurisdictions from 1970 to 1994. Table 3.4-2 is a summary of per capita retail sales tax revenue by jurisdiction for selected years between 1970 to 1994. Table 3.4-1 shows the effect on the local economy of the 1982 and 1991 recessionary periods. Each of the three Sutter County jurisdictions (Yuba City, Live Oak and Sutter County) were affected slightly differently by the recessions. Retail sales in Yuba City deceased by only 1.21 percent during the 1982 recession and had recovered completely by the next year; however, Live Oak and unincorporated Sutter County retail sales decreased by 6.9 and 16.7 percent respectively, and had more difficulty in recovering. Although retail sales increased in absolute dollars in Yuba City between 1990 and 1992, when taking inflation into account, there was a real dollar drop.