1. John Husing, Ph.D. Economics & Politics, Inc. Chief Economist, IEEP Inland Empire Prosperity...

2. After Losing 8.71 Million Jobs … Now At A Record Level of Jobs U.S. Jobs Long Slow Growth - Not Over-Heating

3. Petroleum Prices Back to 2003 Levels Helps Families In Modest Income Areas

4. Value of the Dollar: Helps Imports & Hurts Exports 2012-2015 28.0% 100.0

5. Consumer Confidence, 2009-2016 Needed To Help Homes Sales

6. S & P 500 Stock Index Back to 2,000

7. Interest Rates Very Low Again Encourages Home Sales

9. California Wage & Salary Employment: A Record Level

10. California Job Gains/Losses 2007 15,844,325 Great Recession -1,178,158 2015 16,474,808 Up 630,483 4.0% Up Recovery 1,809,542

12. Inland Empire Economy Gaining Strength!

13. Job Quality

14. Inland Empire Growth was the 2 nd Largest Absolute Job Gain in California in 2015!

15. Unemployment Falling

16. The Issue: Poverty

17. Diversity Challenge

18. Gold Mine Theory Primary Tier Secondary Tier

19. Educational Challenge For Adults & Their Children

20. Health Care

21. Health Care Jobs: Continuous Growth 2011-2015 12% of Job Growth Median Pay $54,261

22. Inland Empire Underserved by Health Care Workers 26.6% More People Per Health Care Worker in 2015

23. Sophisticated Warehousing Operations

24. Port Container Volumes Strong Even With January Labor Slowdown

25. Fulfillment Warehousing

26. E-Commerce Growth Rates Year Over Year by Quarter

27. Net Industrial Space Absorption 23.1 million 20.7 Million Sq. Ft. of Industrial Under Construction December-2015

28. Industrial Overwhelmingly In The Inland Empire

29. Industrial Vacancy Rate 3.6% 3.9%

30. Asking Lease Rates On Industrial Facilities Are Rising

31. Logistics Powerful Job Growth Median Pay $45,677 2011-2015: 23% of New Jobs

32. Permit Valuation Increasing But Slowly

33. PM 2.5: Diesel Pollution -95.6%

34. Manufacturing: Should Be A Major Growth Source

35. California Manufacturing Job Growth Just 5.4% of U.S. Growth

37. CA Is Not Loved By Executives & Entrepreneurs

38. Inland Empire Manufacturing Jobs 2011-2015 5% of Job Growth Median Pay $49,567

39. Construction: Finally Coming Back

40. Notices of Default At Very Low Levels Only 1,000 NODs in January 2016

41. Underwater Homeowners Negative Equity Has Dropped 4 th Qtr 2009 – 3rd Qtr 2015 54.9% to 11.4%

42. Home Price Trends 83.4% -26.9%

43. Long Term Competitive Price Advantage Still Exists $190,000 $202,000 $379,000

44. Affordability to Median Income Household 3 rd Quarter 2015 I. Empire: 45%-55% LA: 27%-73% Orange: 21%-79% SD: 25%-75%

45. Home Sales Volume No Breakout

46. Domestic In-Migration: Stalled -10,241 8 Years -1,280 per year

47. Construction Jobs: Growth Gaining Median Pay $51,051 2011-2015 13% of Job Growth

48. Assessed Valuation 2008-2015 Up $3.2 Billion 0.8% Inflation Up 8.6% SB Co. Up +2.8% Riv Co. Down -0.8%

49. High Paying Sectors Jack Dangermond Ahmad Adel Al-Khatib

50. Higher End Homes Draw Well Educated Workers $599,310 $449,386 $497,455 UPLAND EASTVALE $465,532 $504,397 $450,500 CORONA $441,965 TEMECULA $376,303$405,538 $594,476 Claremont $353,820$355,000 Loma Linda

51. Migration of AA or Higher Redlands-Loma Linda Western Inland Empire Temecula-Murrieta

52. Professionals, Mgmt., Utilities, Mining Slowly Coming Back Median Pay $65,453 2011-2015 3.6% of Growth

53. Office Space Net Absorption 492,858

54. Office Vacancy Rate 15.0%

55. Gold Mine Theory Primary Tier Secondary Tier

56. Retail Sales 2006-2015 Up $7.7 Billion, 12.6% Inflation Up 16.1% SB Co. Up +14.4% Riv Co. Up +10.7%

57. Low Paying Job Growth Retail, Consumer & Bus. Services, Hotel, Eat & Drink Amusement, Agriculture, Employment Agency 2011-2015 44% of Job Growth Median Pay $28,927

58. Federal, State, Local Government Median Pay $57,984 2011-2015 -5% of Job Growth

59. Looking Ahead... Inland Empire Is a Job Engine Again Construction Coming Back … Residential Still Weak Manufacturing Will Be Under Pressure Logistics Will Remain Strong Health Care Should Expand Office Growth An Issue Given E-Commerce Changes Lower Paying Jobs Smaller Share Than Most Areas Labor Availability May Become An Issue Forecast? 3.6% to 4.0% (49,046 – 54,496)

60. www.johnhusing.com