Housing costs, migration expected to crimp Southern California’s economy

Southern California’s economy remains strong, but it’s expected to lag slightly behind the state through 2021, according to a new report.

As with other regions, housing affordability and a net migration inland pose challenges to growth and the efficient movement of people and goods, the Los Angeles County Economic Development Corp. forecast said.

On the plus side, per capita income growth is expected to continue to outpace the nation and state, buoyed by strong employment in the construction, logistics, professional services and healthcare industries.

Shannon Sedgwick, director of the LAEDC’s Institute for Applied Economics, which prepared the report, said the region has definite challenges.

“We have housing issues and a declining population,” she said. “With a decreased labor pool productivity remains low and that makes future economic growth difficult to achieve.”

Regional investment

Long-term regional investments in transportation — most notably the Southern California Optimized Rail Expansion — will help boost growth in the area, the report said. The $10 billion capital improvement program, which runs from 2018 through 2028, includes track additions, station improvements and better signals and grade crossings to improve safety where trains cross surface streets.

It’s projected to generate 1.3 million jobs and provide a $684 billion boost to Southern California’s economy.

The forecast expects the regional economy to expand by 1.8% this year and next year, well below the more robust growth the region saw in 2018 (3.1%), 2017 (3%) and 2015 (4.6%).

The biggest job gains

Southern California is expected to add 129,800 jobs this year and 128,300 in 2021. This year’s biggest employment gain of 52,500 jobs will come in education and health services, the report said, with other sizable increases in leisure and hospitality (20,600), professional and business services (18,900) trade, transportation and utilities (13,200) and construction, natural resources and mining (12,100).

Sedgewick noted that, while the region’s overall economy is still relatively good, many Southland residents are not earning a living wage.

“Twenty-five percent of households with children in L.A. County are receiving some form of public assistance,” she said.

Home values are out of reach for many and will continue to climb, largely as a result of the region’s limited inventory. Southern California’s median home price — the point at which half the homes cost more and half cost less — is expected to reach $593,111 this year, up from $589,249 in 2019, and it will rise to $606,649 next year, the report said.

The forecast also breaks out highlights for each county:

Los Angeles County

  • Economic expansion: 1.8% this year and 1.6% in 2021
  • Employment growth: 48,400 this year and 42,200 in 2021
  • Unemployment rate: 4.3% this year and 4.1% in 2021
  • Median home price: $658,339 this year and $674,463 in 2021

Orange County

  • Economic expansion: 1.7% this year and 2% in 2021
  • Employment growth: 16,200 this year and 19,600 in 2021
  • Unemployment rate: 2.7% this year and 2.6% in 2021
  • Median home price: $745,385 this year and $764,271 in 2021

San Bernardino County

  • Economic expansion: 2% this year and 1.8% in 2021
  • Employment growth: 15,000 this year and 15,200 in 2021
  • Unemployment rate: 3.9% this year and 3.8% in 2021
  • Median home price: $380,640 this year and $394,179 in 2021

Riverside County

  • Economic expansion: 2.3% this year and 2% in 2021
  • Employment growth: 13,600 this year and 12,100 in 2021
  • Unemployment rate: 4.3% this year and 4.2% in 2021
  • Median home price: $390,548 this year and $403,761 in 2021

The report defines Southern California as a 10-county region that includes Los Angeles, Orange, San Bernardino, Riverside, San Diego, Ventura, Santa Barbara, Imperial, Kern and San Luis Obispo counties.

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O.C. psychiatrist pleads guilty in prescription drug diversion scheme

SANTA ANA — A Santa Ana-based psychiatrist pleaded guilty Monday to participating in a scheme to disseminate prescriptions for opioids and other drugs for non-medical reasons.

Dr. Robert Tinoco Perez of Westminster, 56, signed a plea agreement with federal prosecutors Jan. 28. He pleaded guilty to one count of conspiracy to distribute controlled substances Monday afternoon in a federal courtroom in Santa Ana.

Perez could face at least 57 months behind bars, but his attorneys will get the chance to argue for less time, said defense attorney Kate Corrigan.

“He had seven family members there to support him” in court on Monday, Corrigan said.

“He had some rough times in his life that caused his judgment to be clouded and he’s looking forward to putting this behind him and getting his life back on track. He went from being a very successful, very reputable guy with a lot of patients who relied on him and loved him to somebody being charged. It’s a sad situation, a stunning fall from grace.”

From about 2017 through June 2018, Perez operated the scheme with co-defendant William Jason Plumley, 40, of Huntington Beach, who was sentenced in December to 70 months in prison, and others.

Perez issued prescriptions for oxycodone, hydrocodone and amphetamine salts to Plumley and others for recreational purposes, according to his plea agreement.

Perez, for instance, issued a prescription to one man in December 2017 for 60 pills of 30 mg Adderall, “knowing that the drugs would not be used by” the bogus patient, who sold the prescription to Plumley, according to the plea agreement.

Another time that month, he issued a prescription to the same man for 90 pills of 30 mg Roxicodone, and the man sold it to Plumley for about $700, according to the plea agreement.

Plumley asked Perez to issue prescriptions to another person on Dec. 26, 2017, at the defendant’s clinic in Santa Ana, according to the plea deal.

Perez told Plumley to fill out new patient paperwork, prompting Plumley to use a fake name. The doctor issued a prescription for 120 pills of 30 mg Roxicodone and another prescription for 60 pills of 30 mg Adderall in the fake patient’s name for $400, according to the plea agreement.

Perez issued similar types of prescriptions to bogus patients on numerous other occasions, prosecutors said.

Plumley admitted one federal count each of distribution of methamphetamine and conspiracy to distribute controlled substances on Oct. 9, said Assistant U.S. Attorney Rosalind Wang.

Plumley also admitted he sold 26.94 grams of methamphetamine on Jan. 16, 2018 in a Super 8 Motel parking lot on Harbor Boulevard in Costa Mesa, according to his plea agreement.

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U.S. sues O.C. company to stop unapproved hand sanitizer sales

SANTA ANA — The U.S. Justice Department sued a Lake Forest-based company for distributing hand sanitizer products that have not been approved by regulators.

The federal lawsuit filed Tuesday seeks an injunction against Innovative BioDefense Inc. and its president and chief executive Colette Cozean from distributing Zylast products that officials say are not approved by the Federal Food, Drug and Cosmetic Act.

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The lawsuit alleges the products are falsely marketed as effective at fighting various viruses.

“Consumers deserve confidence that the drugs they use are safe and effective,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “The Department of Justice will continue to work with the FDA to ensure that manufacturers do not circumvent the drug approval process.”

A message left with the company was not immediately returned.

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