SoCal To Experience Strong Economic Growth Into 2024


Southern California will ride the wave of strong economic growth entering 2024, buoyed by a healthy labor market, new development, tourism and increased foreign trade, the region’s leading economists said Thursday, Nov. 7. 

Economists from across the six-county region offered a mostly optimistic forecast for the coming year, in a report released at the 14th Annual Southern California Economic Summit, though they cautioned that continued inflation and high interest rates will likely slow the rate of growth during the second half of 2024. 

“Southern California has remained resilient, despite global economic pressures threatening a recession for more than a year,” said Gigi Moreno, Senior Economist for the Southern California Association of Governments (SCAG), which hosted the summit. “Most of our key industries are performing significantly above pre-pandemic levels, and with the resolution of labor disputes at the ports and in Hollywood, we’re going to enter the new year with economic momentum.” 

Among industry sectors that continue to grow across the region, hospitality and tourism, arts and entertainment and healthcare stand out. Advanced manufacturing, software development and scientific and technical consulting also are on a steady growth path. 

The region’s annual growth for 2023 is expected to land at a robust 2 to 4 percent, slowing to less than 1 percent by mid-2024 due to inflation and high interest rates. 

The report was released in conjunction with the 14th Annual Southern California Economic Summit in Downtown Los Angeles, hosted by SCAG to empower local jurisdictions in working toward regionally beneficial solutions. The outlook presented Thursday also highlighted the diversity of the six counties that make up the six-county SCAG region: 

In Imperial County, unemployment currently hovers near 19 percent, versus 4.5 to 5 percent for the SCAG region as a whole. At the same time, Imperial County’s agriculture production continues to grow, while investment in solar production, battery storage, geothermal generation and lithium extraction are pumping billions of dollars into the economy. Imperial County ranks second in California for renewable energy production, behind only Kern County. 

Los Angeles County continues to face pressing economic challenges, including a population decline, high office vacancies, low housing supplies and high poverty rates. The labor disputes involving the ports and Hollywood also significantly impacted LA County. At the same time, the county’s global connectedness and large, diverse economic base have enabled it to avoid a recession and move toward modest, sustained growth in the coming years. 

Orange County also benefits from a diverse industry base, which has helped keep its unemployment rate at the lowest in the SCAG region – 3.7 percent. Orange County also boasts the region’s highest educational attainment, highest median household income and a growing labor force participation rate. A recent projection shows Orange County adding nearly 250,000 jobs in the top 10 employment sectors over the next decade. 

San Bernardino and Riverside Counties (the Inland Empire) continue to draw strength from their role as a global logistics and supply chain hub, adding 16,200 jobs per year since 2018 in the transportation and warehousing sector. However, as consumption patterns around the world have shifted from goods to services since the pandemic ended, job growth in the Inland Empire’s logistics sector also has softened. At the same time, the two-county region has seen strong job growth in healthcare, public administration and professional, scientific and technical services. 

Ventura County has gained 27,400 jobs since the pandemic low of mid-2020, the most for any three-year period since 1998 to 2000. In 2023, healthcare and social assistance added 1,900 jobs, higher than any other sector. Ventura’s Gross Domestic Product is expected to grow by 4.8 percent in 2023, fueled by a surge in new housing and higher-paying jobs in a number of sectors, including manufacturing, health care, and professional, scientific and technical services. 

These economic outlooks were provided by members of SCAG’s Economic Roundtable: Michael Bracken, Development Management Group (Imperial County); Shannon Sedgwick, Los Angeles County Economic Development Corp. (Los Angeles County); Wallace Walrod, Tech Coast Consulting Group and the Orange County Business Council (Orange County); Manfred Keil, Inland Empire Economic Partnership and Claremont McKenna College (Inland Empire); Mark Schniepp, California Economic Forecast (Ventura County); and David Roland Holst, UC Berkeley (Region-wide). 

SCAG’s 14th Annual Southern California Economic Summit, themed “Accelerating the Region,” also examined major economic factors that inform Connect SoCal 2024, SCAG’s draft Regional Transportation Plan/Sustainable Communities Strategy now available for public review. 

View more resources related to the 14th Annual Southern California Economic Summit below: