Summary of national and local economy heard at Outlook Conf.

The News Review will publish a series of articles on the 2022 Economic Outlook Conference sponsored by the Ridgecrest Chamber of Commerce. These articles will include the addresses of the conference speakers. The first will be part one of the keynote speaker Dr. Mark Schneipp. He addressed the economy both nationally and locally.

Outlook Continues ...

The Pandemic

The ubiquity of the virus, despite the diminished health risk the latest variant poses, has weighed heavily on economic activity. Daily infections of COVID-19, which had soared to 800,000, have fallen dramatically and should enable sustainable economic improvement.

The economy has clearly improved, but the public does not generally see it. The extent of the recovery in the public’s perception of economic conditions will remain limited until policymakers stop counting daily infectious cases, inflation begins to abate, supply chain bottlenecks ease, vaccines are no longer mandated, and more people come back to work.

We desperately need the pandemic to end or an acceptance by all that the risks have largely abated and coronavirus is something we can now live with. The longer the pandemic is allowed to persist, the more lasting its impacts will be.


The California economy was severely impacted by the shutdowns imposed during the pandemic surges. Consequently, the state’s economy lags most other states in getting back to normal. A full recovery is not expected this year.

However the state is nevertheless responding with a healthy pace of job creation (or reinstatement), the growth of wages and salaries, the recovery of manufacturing, and the return of tourism from both domestic residents and international visitors.The principal engines of growth are first: the service sectors that develop software, design computer circuit boards and architecture, provide data processing services, and all things internet. Next is new construction and after that is tourism.

What has also become prominent with the rapid growth of online commerce is the warehousing and storage sector which includes transportation to and from distribution and fulfillment centers where goods are sorted, packaged and shipped to other retail centers or directly to consumers. Employment in all of these sectors has entirely recovered.

There has been a healthy increase in new home building in California over the last 18 months, largely getting the construction sector back to full employment.

There is also the largest development project in the nation that currently employs a record 6,000 workers in the Central Valley. This is the $105 billion high speed rail project. Ultimately San Francisco will be connected to the Los Angeles Basin upon completion of Phase 1, a 500 mile segment. At this time, the 119 miles that are under active construction will connect Bakersfield with Merced and Fresno.

Short handed in California are the sectors of the economy that directly provide visitors and residents with food services, lodging, recreation and amusement activities. The leisure and hospitality sector is more than 300,000 workers from full recovery. There is sufficient demand for these workers, but the labor force has not recovered enough to supply them.

Omicron cases have largely abated, mask mandates have been lifted, and the next variant is not eminent. Consequently, the chances of getting past the pandemic early this year are rapidly rising.

The Indian Wells Valley

The local economy initially rebounded faster than either California or Kern County in 2020. But momentum slowed in 2021 and the regional labor market has not yet restored all of the jobs lost in the recession. Much of this is due to attrition within the federal civilian workforce at China Lake and the slow return of the region’s labor force. Without a sufficient labor force, open job positions will remain unfilled. Meanwhile, the unemployment rate indicates that the region is at full employment again.

The principal decline in the workforce was due to the closures of, or restrictions on hotels, restaurants, other food services, personal services and healthcare services in 2020 and early 2021. All of this economic activity is now restored, paving the way for a full recovery this year if workers can be recruited. Currently on Indeed, there are 614 job solicitations in the Ridgecrest area with most of these from Ridgecrest Regional Hospital, or China Lake IT and engineering contractors.

The construction industry is soaring due to projects underway in the city of Ridgecrest and at China Lake. Earthquake repair projects at the Base have brought hundreds of construction workers into the area. With 15 projects now underway and two more to break ground this spring, the construction workforce is set to expand further.

Ninety new permits for single family homes were issued in 2020 and 160 residential units were permitted in 2021, representing the largest surge in new homebuilding in at least 10 years. The largest authorized project in 2021 was the Mojave View Apartments, an affordable apartment complex of 8 buildings and 76 units.

Other projects that will start this year or in 2023 include the Oasis Entertainment Complex, Marriott Townplace Suites and several fast food restaurants.

When the winter 2021 surge had ended and many states were opening up their economies during the spring, there was optimism that the pandemic was over, and the demand for travel soared. Death Valley attendance rebounded sharply between October 2020 and April 2021. Though the onset of the Delta variant interrupted a complete recovery in the summer and early fall months last year, attendance is rising again, and during this calendar year historically high levels are likely again.

Occupancy rates for hotels and motels in the high desert region had returned to pre-pandemic averages. But the surge of Delta in the late summer of 2021 followed by Omicron in November interrupted the flow of visitors to Death Valley National Park and the Eastern Sierra. Lodging establishments were not as full during the fall.

The winter ski season has generated strong visitor demand since late November 2021. Unless the pandemic spawns another problematic variant, visitor counts to Death Valley, Red Rock Canyon, and the Eastern Sierra are expected to return to normal this year. When the pandemic hit in 2020, production of films and TV came to a screeching halt in California. There was no demand for on-location shoots in the Indian Wells Valley for many months. By the end of the year however, filming activity was back. And during calendar 2021, a total of 24 permits were issued for 6 movies, 1 TV show, 8 music videos and 9 commercials.

The median home price in Ridgecrest increased 12.7 percent in 2021, rising to $229,700. With the lowest mortgage rates on record, the area remains one of the most affordable locations in California. The median price of Inyo County homes just north of the Indian Wells Valley rose sharply during 2021 to $446,000.

Continued next week ...

Laura Austin File Photo: Dr. Schniepp, Director of the California Economic Forecast in Santa Barbara.

Story First Published: 2022-03-11