John Husing, Ph.D. Economics & Politics, Inc. Chief Economist, IEEP State of the Inland Empire . . . An “Adventure” John Husing, Ph.D. Economics & Politics, Inc. Chief Economist, IEEP

Inland Empire Population Chino 86,757 Chino Hills 83,159 Greater Than 25 of 50 States

Forecasting

Population Forecast, 2018-2045 2045: 6,119,497 1,111,783

Educational Challenge Chino 49.6% Chino Hills 24.3% Chino 26.7% Chino Hills 55.4%

Inland Empire’s Powerful Job Growth!

Inland Empire A CA Job Engine!

Poverty Falling With Job Creation Chino 17.2% Chino Hills 7.5% Chino 13.6% Chino Hills 9.0% 23.5% 16.4%

U.S. Jobs Still Setting Records

Add Potential Workers: Given Up Or Part Time 17.9% Add Potential Workers: Given Up Or Part Time 10.1% 6.9% 3.6%

Inflation: NOT MUCH! 3.3% 2.0%

A Short Term Rate Decrease? Interest Rates: A Short Term Rate Decrease? 4.12% 2.50%

Yield Curve: Potential Recession Predictor Recession: 2020 Likelihood An Issue 2 Year to 10 Year 0.22%

TARIFF MAN?

California Job Gains/Losses

CA Hollowing Out Middle Class Jobs

Gold Mine Theory Secondary Tier Primary Tier

Median Health Care Pay: 2018 $62,363

ACA & Health Care Demand Chino 6.9% Chino Hills 1.6% -60% Drop in Uninsured

Rationale: Health Providers Paid 65% of Medicaid Costs ACA Attacks 2019 Forecast: 4,800 Rationale: Health Providers Paid 65% of Medicaid Costs Shortage of Trained Workers ACA Attacks

Logistics

Median Logistics Pay: 2018 $47,946

E-Commerce 14.5%

Port Container Import Volume Record Levels

Industrial Construction Locations

2019 Forecast: 9,000 Rationale: Running Out of Land in the Valley Areas Tariffs Shortage of Trained Middle Managers U.S. Growth Slowdown

Disappearing Available Space For Facilities x Market  500,000+ 1,000,000+ High Desert 206 42 Coachella Valley 92 21 Moreno Valley/Perris 117 59 West SB Valley 45 12 Central SB Valley 49 9 East SB Valley 16 1 Southwest 15 Pass Area 23 7 Western RivCo Edge 13 3 Riverside 5 Total Remaining  581 157 Without Deserts, Moreno Valley/Perris 166 35 23,000,000 sf under construction Dec-2018

ONT Airport Cargo Another Record Volume 12.4% 0.9%

ONT Airport Passengers 1989 Level 12.4% 4.6% 1988-2018 Population: up 2.4 million or 108.2% to 4.6 million Job Level: up 864,502 or 133.5% to 1,512,194 Companies: up 75,133 or 187.3% to 75,133

2018 Median Manufacturing Pay $54,800

U.S./CA Manufacturing Job Growth

CA Electrical Cost +88.0% +127.8%

Marijuana?

2019 Forecast: 1,000 Rationale: Regulation & CA Electrical Costs Tariffs Shortage of Replacement Skilled Workers U.S. Growth Slowdown

Median Construction Pay: 2018 $53,322

Home Prices Chino $541,000 Chino $497,000 Chino Hills $1,054,000 +4.2% -9.4%

Price Competition Highest Price Gaps In History

Housing Unaffordability

Home Sales & Construction: Lack of Growth

2019 Forecast: 6,000 Rationale: Difficulty Permitting Lots CA Environmental Quality Act Very High Prices, Low Volume, Lack of Supply Shortage of Skilled Craft Workers

Median Private High-End Pay: 2018 $76,202

Median Government Pay: 2018 $63,499

Home Volume: No Growth

Assessed Valuation Chino $13.4 billion; Up 9.7% Chino Hills $12.3 billion; Up 6.3% 2008 peak to 2018 AV in RivCo up 16.9% AV in SBCo up 21.9% Inflation Up 16.0%

Taxable Sales Chino $2.5 billion; 9.6% Chino Hills $0.7 billion: 10.4% 2006-2017 RivCo Up 21.2% SBCo Up 21.9% Inflation Up 21.7%

2019 Forecast: 3,500 Rationale: Education Gap To Coastal Counties Government Tax Revenue Difficulty (internet)

Median Moderate Paying & Real Estate, Finance, Education Jobs: 2018 $57,109

2019 Forecast: 3,900 Rationale: Banks Hiring Less Real Estate Sales Not Growing School Budget Growth May Slow

Population Serving Sectors High End Consumers Still Doing Well E-commerce death 3rd Strongest Inland Sector

Population Serving Sector Pay: 2018 $32,177

Median Household Income, 2017 Deducting Housing Costs Above IE Chino $72,369 Chino Hills $99,763

2019 Forecast: 9,900 Rationale: E-Commerce Hurts Retailing Lack of Available Workers (4.2% Unemployment) Workers Going to Logistics

Looking Ahead

2019 Forecast 2019 = 38,200 v. 2018 = 49,300 Growth 2.52% 3.36% Unemployment 4.2% 4.2% 2018 = 49,300 Growth 3.36% Unemployment 4.2%

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