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Observers expect slow growth for county economy in 2012

  • A worker installs siding on a home under construction in the Lennar development at Linwood Villas in Santa Rosa.

Real estate sputtered and the wine crop disappointed, but the tech sector rallied and tourism bounced back in Sonoma County in 2011.

Many families and businesses continued to struggle last year, but economists and business leaders suggest the worst may be over for the county's economy.

"We're beginning to see the tide change," said Ben Stone, executive director of the county's Economic Development Board.

Still hovering in the shadow of the recession, 2012 is expected to produce business growth, but at a rate that in earlier recoveries would have been considered sluggish.

"Right now the pace of economic growth is still painfully slow," said Eduardo Martinez, a senior economist who studies the county for Moody's Analytics in West Chester, Pa.

The county's unemployment rate, a key measure of economic health, averaged about 9.9 percent for 2011, down from 10.5 percent in 2010.

This year the unemployment rate is expected to fall to 8.9 percent, but it won't average 7 percent until 2014, Martinez said.

A key reason unemployment remains so high is due to the collapse of the real estate and construction sectors.

While 2011 was expected to be the worst year in a half century for single-family home construction nationally, Sonoma County saw slight improvement.

As of November, builders had received 532 permits for new single- and multifamily homes, compared to 429 for the same period in 2010. Still, the numbers amount to a fraction of the 2,000 homes built annually in the decade before the housing downturn.


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