General Session – Speaker, Chris Thornberg*
It’s the Housing Supply, Stupid!
The ongoing handwringing about an impending recession and the recent volatility of financial markets stand in stark contrast to an economy that just keeps trucking along at 2.5% growth despite trade wars, a real estate slowdown, and the inverted yield curve. But all is not as well in the Golden State, where job and output growth have slowed to national averages after years of being far and away above those levels. The reason for the slowing is basic economics – a labor scarcity that leaves too many job openings in the state unfilled. That scarcity is, in turn, being largely driven by a lack of housing supply and, unfortunately, Governor Newsom has not secured even basic reforms to help expand supply. As such, next year will be even tougher for California businesses as they struggle to find the workers they need to take advantage of the otherwise robust U.S. economy.