California Needs Housing for Growth

A recent study of California's economy predicts great success for the state. According to the San Francisco Chronicle, the projection, made by the University of the Pacific's Center for Business, calls for slow but steady economic growth for California. This slowed rate can be attributed to a handful of things. Chief among these is the slowed population growth rate. In the report, it is suggested that California's rate of new residents per year will fall from 350,000 to 250,000 by 2020. This can be largely attributed to significantly lower birth rate as well as reduced immigration. Along with these factors, housing shortages, which plague the state's big cities, play a part in a restricted population growth rate, as it hampers economic expansion.
These housing shortages also have a profound effect on economic displacement, resulting in a focused economic growth in a small amount of areas. This will result, according to the study, in a increased job growth for certain regions, such as San Francisco, in spite of low unemployment and slow housing growth. The study points out that, in San Francisco especially, there has been a replacement of many families and retirees, who are not among the labor force, with a number of high-wage laborers. Many of these displaced non-workers have moved on to areas like the Central Valley, causing a swelling of population without a correlating increase in the workforce.
As such, the one major thing to be combated in the face of possible economic turmoil is housing production, according to the study. The projections call for increased attention to be paid to the housing problem, as many state officials can have little to no influence over things like birth rates and immigration. The study maintains a need for less expensive housing in order to encourage steady economic growth in spite of a few setbacks.