California's growth lacks luster

Shedding jobs that once reliably attracted new residents, California grew at a slower pace this year than all but two other years since 1900, according to state Department of Finance figures released Thursday.

The number of new births dropped.

The number of new immigrants dropped.

And more residents left California for other states than came here from them.

The end result: statewide growth from July 2008 to July 2009 of 350,000 people, or less than 1 percent. During the rest of the decade, California averaged 525,000 new residents each year.

Stanislaus County followed that trend, adding just 3,038 people in 2009, a growth rate of 0.58 percent and only a fraction of the 15,098 residents added in 2001.

The calculus is simple. "What attracts people here is jobs," said Dennis Meyers, principal economist for the Department of Finance. "When the jobs slow down, the population growth slows to a trickle."

California saw a net loss of 800,000 jobs from July 2008 to July 2009, according to the California Department of Labor. During the rest of the decade, it netted an average of 115,000 additional jobs each year.

The unemployment rate in Stanislaus, Merced and San Joaquin counties is expected to approach 20 percent before this winter ends. Couple that with the crash in the housing market and it's clear why the region stands out as one of the most economically depressed in the nation.

People have to work to pay their bills; many simply are moving away to start fresh elsewhere.

Elk Grove resident L.J. Smith is ditching California after 40 years here. He had major back surgery about a year ago, went on medical disability, and was laid off by an insurance company before he was able to come back to work.

He spent several months looking for a new job, and finally found one — in Texas.

So Smith and his wife told their two teenage children they would be moving. He's now posting online classifieds trying to sell stuff before his family leaves in mid-January.

"I've got a lot of mixed feelings," said Smith, who has relatives in Houston and will work a desk job for an oil company. "I love California. But we can't do it here."

When people such as Smith take the income they once spent here and move on — or don't bring that income here in the first place — it negatively affects the region's economy.

"Retail, banking, general services — they are probably going to suffer," said Meyers, the economist.

Slow growth also could negatively impact the real estate market, Meyers and others said, because more people often means more homes sales and more construction work.

Slower growth does have its benefits. There's less congestion, less competition for jobs and less rushed government planning.

"It gives the organizations in our state a little bit of a breather," said Jeffrey Michael, director of the Business Forecasting Center at the University of the Pacific Eberhardt School of Business.

Stanislaus County's growth in 2009 was entirely a result of births (8,563), which outpaced deaths (3,663) and also offset the net loss in migration — 1,862 more people left the county than moved here.

Merced and San Joaquin counties also saw growth rates of less than 1 percent — 0.95 percent for Merced and 0.88 percent for San Joaquin.

Looking ahead, next year's growth could be even slower, said Michael, because many would-be parents likely decided that 2009 wasn't the time to start a family.

After that, Michael said, slow growth in the Central Valley "will begin to subside as the economy slowly recovers and population growth will pick up above 1 percent." However, even that uptick, he said, "will still be well below the growth of past decades."