The people who live and breathe the study of Kern County economic statistics see signs of home and evidence of lingering challenges as they review 2017 and look forward to 2018.

Optimism is Richard Chapman’s job as CEO of the Kern Economic Development Corp., an independent agency tasked with improving Kern County’s economy and marketing the county to major firms and businesses that might choose to locate jobs and operations here.

He’s seeing improvements in Kern County’s employment picture and a commitment to job training, infrastructure and STEM education — the science, technology, engineering and mathematics economy that offers high wage jobs.

He is hopeful that the county’s future is bright.

“Now is the time for us to start to move forward and sow the seeds,” he said of a high-tech Kern County. “We have the ingredients for a great soufflé, but will the soufflé rise?”

Commercial real estate professionals see the kind of restrained growth and practical approach to development that promises to sustain steady economic improvement in that sector.

And residential real estate experts see solid numbers in 2017 that could improve in 2018.

But Kern County still faces a challenging economic outlook for the oil and gas sector and the lingering effects of the drought that ended last year.

So there aren’t many people predicting an economic boom in the new year.

And that isn’t a bad thing, said Cal State Bakersfield economics professor Richard Gearheart.

He feels like 2018 will be more of the same economic pie.

“The biggest sign of hope for 2018 is the recognition that oil may be $50 a barrel for a long time,” he said. “We have put ourselves on the right track for beyond 2018.”

An honest look at the fiscal reality Kern County faces is a healthy thing, Gearheart said.


Chapman said he’s seeing modest growth in underlying economic numbers.

Kern County unemployment was down to 7.5 percent in October, according to the U.S. Department of Labor Statistics.

The numbers in the oil, gas, mining and logging sector are down 1.1 percent, Chapman said.

But solid growth is happening in the retail, leisure and hospitality, transportation and warehousing, and health care sectors, he said.

Health care is especially encouraging because they represent good jobs and the addition of medical professionals means better care for Kern County residents, Chapman said.

“As we build the infrastructure, fewer and fewer people have to go to Los Angeles” for care, he said.

Wages are up, but only by half the California average.

But Kern County’s reasonable cost of living, Chapman said, is bringing people in from the Los Angeles basin and many of those people are college grads.

Kern County still hasn’t fully recovered from the 2008 recession.

But Chapman said things are trending in the right direction.

“We regained our footing. Oil prices ticked up a bit. We’re starting to make our way back,” he said. “We have the basic components to move forward so I was pretty confident that we would emerge from that downturn. The question now is, how do we go from here?”


Gearheart offers some cautionary thoughts in assessing Kern County’s current economic situation.

“About 70 percent of the people who have become employed have been employed through the ag sector,” he said. "If you actually took out how many people entered the ag job sector, unemployment would be in the nines.”

It’s good to have people employed but agricultural jobs are not generally in the high-paying category.

“We haven’t seen any high-tech jobs,” Gearheart said. “KEDC is trying to do that with the tax grants. But that might be a decadelong process.”

But he also feels that good developments — like the revitalization of downtown Bakersfield — will pay dividends down the road.

Millenials like Bakersfield's rebuilt downtown and the downtown housing that’s now being offered.

In 2018, things should improve, even if there’s a slow start to the year.

“People shouldn’t become uncomfortable about the future if things start off a little slow in 2018,” Gearheart said. “I think those will correct themselves in the latter half of 2018 and pick up speed going into 2019. I think we get very hard-hit by Christmas and the credit card bills and we get incredibly frugal from January through March” and that caution impacts the local economy.


Talking to The Californian earlier in December, commercial and residential real estate leaders shared the same sort of cautious optimism about their sector of the economy.

Scott Underhill, of Newmark Grubb ASU & Associates, and Jeff Andrew, with Cushman & Wakefield, said the office market has taken a blow from the downturn in the price of oil and the accompanying loss of oil jobs.

But unlike in past downturns, the rest of the office market tenant landscape has taken up the slack, keeping things alive.

"It just didn't hurt us as bad as it has in the past," Andrew said.

Health care companies are a bright spot in that market as they expand and take up space.

Cushman & Wakefield professional Duane Keathley said good signs of hope have emerged in the retail commercial area.

A couple of new or reworked shopping centers are in the works, including the Stockdale Centre at Stockdale Highway and Coffee Road; the future Bakersfield Commons project at Brimhall and Coffee roads; and the planned renovation of East Hills Mall.

There’s similar good news in the residential real estate market, according to local expert and appraiser Gary Crabtree.

"Are we setting the world on fire? No. We're vastly underperforming (compared to) the rest of the state, " Crabtree said in mid-December. "We' re still kind of restricted by our median family income. We don't have the high-paying, high-tech jobs."

But the foreclosure rate is very low, the supply of homes is low, demand is up and those patterns are holding.

"The economy is about as stable as you' re going to get it. The economy is absorbing the job losses," he said. "There' s a degree of stability and that' s a good thing."

James Burger can be reached at 661‑395-7415. Follow him on Twitter: @KernQuirks.

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