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Need a job, selling your house? OC economists have a positive forecast

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Chapman University economists are predicting small but continued growth for Orange County in the coming year, with modest gains in jobs, personal incomes and resale prices of single-family homes.

Researchers of the university’s 37th annual Economic Forecast, presented in Costa Mesa’s Renée and Henry Segerstrom Concert Hall on Wednesday, predicted a 5.5% countywide increase in personal income but went a step further on their job growth outlook, forecasting a more rosy scenario than even state authorities.

Orange County job growth will maintain its years-long steady uptick next year by 2.6%, or 38,000 jobs, said Esmael Adibi, director of Chapman’s A. Gary Anderson Center for Economic Research.

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He compared that to this year, which saw an estimated 31,000 new jobs and a 2.1% increase from 2012.

Adibi said there are sampling flaws in the state’s Employment Development Department because it does not account for job creation in newly established small firms and other firms that hire one or two additional workers.

Healthcare employment in California is a particularly strong field that will see great gains in its workforce, Adibi noted.

Fueled by the federal Affordable Care Act, which brought insurance to roughly 3.5 million people who were previously without it, the industry could see a 25.4% statewide increase, or nearly 500,000 jobs, through 2020.

A related job field, pharmaceutical and medical device manufacturing, will see an annual growth rate of 2.1% over the next six years, according to Chapman researchers.

Because of the positive trends in job growth, Orange County’s housing market is showing at least one indicator of “normalizing,” Adibi said, though it remains unaffordable for most.

According to a Chapman news release, a home buyer with an estimated median family income of $86,600 in 2014 must spend about 35% of his gross income toward a home, which, while a still high figure, is less than the 47.3% needed in 2006.

In 2012, however, the cost was 27.2%, showing an increase of 7.8% over two years.

Continued housing unaffordability will dampen the rate of home-buying in 2015, according to Chapman, which nonetheless predicted a 4% increase in single-family home resale prices. In 2013, the figure was a 20.3% increase compared to the year before.

Chapman also predicted housing demand for 37,034 new units needed through 2020, based on an average of three people in a household.

The 2015 Economic Forecast update is scheduled for June in the Renée and Henry Segerstrom Concert Hall, 600 Town Center Drive, Costa Mesa.

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