Economic forecast: Unemployment low in Sonoma County, but key challenges remain

Sonoma County’s economy is starting the year strong, with unemployment at an encouraging low and a series of promising projects in store, even as challenges remain around affordability and uncertainty prevails over the priorities of President-elect Donald Trump’s administration, officials said Thursday.

Speakers at the annual State of the County breakfast assured hundreds of representatives from government, business and elsewhere that the region in 2016 made significant economic strides and was poised to continue growing. But the high cost of living remains a major obstacle, and pledged actions by Trump - including his intent to deport millions of undocumented immigrants and rollback Obamacare - could prove major economic disruptors.

“At least here in Sonoma County, things have not only returned to where they were before the recession, but they’ve actually gotten better,” Ben Stone, executive director of the Sonoma County Economic Development Board, told the audience gathered at Rohnert Park’s DoubleTree Hotel.

Stone described nearly every business sector in the county as “booming” and said he was encouraged by the number of new homes planned and the amount of people employed here. Sonoma County’s unemployment rate, at less than 4 percent ending 2016, was among the lowest the county had seen in the past decade and also among the ?lowest in the state, Stone noted.

He also pointed to a range of developments and initiatives throughout the county, including hundreds of new homes built in Rohnert Park, progress on marijuana policy in Santa Rosa and Russian River Brewing Co.’s new brewery and brewpub planned in Windsor.

Statewide, California finds itself “somewhere in the neighborhood of full employment,” said UCLA economist Jerry Nickelsburg, who gave a forecast touching on the national, state and local economy. Full employment makes large economic gains difficult moving forward, at both the state and local levels, but he still predicted modest growth in 2017.

Nickelsburg said Trump’s plans to deport millions of undocumented immigrants would be difficult to execute but could negatively affect California, which relies on immigrant labor especially in its $47 billion agricultural industry. Some cities have vowed to resist the deportation program, and Trump has said he would punish them by pulling federal funding.

At the same time, the state could stand to gain some from potential infrastructure investments and an increase in defense spending under Trump and the Republican-led Congress, Nickelsburg said.

Locally, Sonoma County’s economy is transforming, particularly in the production of food and beverages and other such goods, Nickelsburg said, citing the planned Russian River Brewing site as an example.

“You all are doing something in manufacturing that’s just not happening in other parts of the U.S.” he said. “The economy is in transformation. There are different kinds of jobs being created, and when you have those kinds of changes, you don’t grow quite as fast.”

But the county’s high cost of living, fueled in part by its desirable quality of life, will continue to challenge local officials this year. Supervisor Shirlee Zane, the new chairwoman of the Board of Supervisors, reiterated her intent to tackle the issue head-on, prioritizing housing construction as a key way to ease pressure on buyers and renters.

At one point in her remarks, she held up a shovel and repeated her mantra of late - “Build baby, build.”

On Tuesday, at the board’s first meeting of the year, Zane said she hoped to see work begin on more than 1,000 new units in Santa Rosa by the end of the year.

“Here’s the sober reality: Our community is in desperate need of housing,” Zane said.

The median home price in Sonoma County was $575,000 as of November.

“A half-a-million-dollar home is simply not affordable for young people, for teachers, for our first responders, our health care workers ... among many others,” Zane said.

You can reach Staff Writer J.D. Morris at 707-521-5337 or jd.morris@pressdemocrat.com. ?On Twitter ?@thejdmorris.