The San Fernando Valley is a true economic hotspot in the midst of a stretch of robust growth now entering its sixth year, according to a California Lutheran University forecast report released on Wednesday.

And over the past five years, its economic growth averaged more than 4%, resulting in a third straight year of relatively strong job growth.

With its growth in intact, the San Fernando Valley will remain extremely favorable relative to the larger Los Angeles Metro area, the state and the nation as indicated in the CLU Center for Economic Research & Forecasting report dated Jan. 14, 2020.

The fastest growing sectors last year in the San Fernando Valley were construction, transportation, warehousing and information and technology — including software engineering, internet development and motion picture production, which continues to be a significant driver.

Over the past three years, job growth averaged 2.2% in the San Fernando Valley, compared to 1.6% nationwide and 14% for the greater Los Angeles area.

By comparison, the broader Los Angeles metropolitan area has averaged economic growth of 3.1% and the nation averaged 2.5%. During this same period, the state grew 3.9%, nipping at the heels of the San Fernando Valley economy, according to a written summary by CLU’s Matthew Fienup.

Relative to its neighbors and the country, the San Fernando Valley is still growing quickly and has uncommon economic strength.

“It’s reasonably big and its growth is fairly rapid,” said CLU Associate Professor Dan E. Hamilton. “The Valley’s strength will be better protected from a negative economic event.”

Hamilton added that if the overall economy is pushed into an unknown recession, the San Fernando Valley will be more resilient than other economies.

While the report shows San Fernando Valley’s economy is forecasted to experience an economic slowdown, it is also forecasted to grow by 3.4% in 2020 and 3.3% in 2021 compared to the broader Los Angeles Metro economy forecasted to grow at 2% in 2020 and 1.8% in 2021.

“The forecast shows a moderate growth rate, but growth nonetheless,” said John M. Parker of Parker Brown General Contractors, a Canoga Park-based construction firm that started in 1993 with five employees and now boasts 55, of which 40 live in the San Fernando Valley and half of whom reside in multi-unit buildings. “While construction is predicted, I think they said for a 5% growth, other industries like health and hospitality were in the 50% growth rate. I like to hear that.”

Parker, who attended a morning meeting on Wednesday with about 130 others at the Hilton Hotel & Resorts on Canoga Avenue in Woodland Hills, said new multi-unit dwellings are under construction in the San Fernando Valley and while some say it is expensive to live here, it’s not as expensive as many other areas.

“I think it will help in the future because people will have somewhere to live,” Parker added. “The Valley will continue to be attractive because of the population of workers available.”

Bruce T. Andersen, a Woodland Hills-based CPA who also attended CLU’s forecast breakfast meeting on Wednesday, said he took away the fact that while the Valley’s economy is a solid one, it lacks housing, manufacturing and high-paid jobs.

“The lack of housing has already had a major impact on Ventura County,” Andersen said. “We can look to there. If we don’t fix it in the San Fernando Valley, we will have more of the same problems.”

Andersen said the types of manufacturing that needs to come to the San Fernando Valley are bio tech and protype projects such as iPhones or other electronics on a small scale unlike the large manufacturing China can offer.

“The key is to have those protype facilities on a smaller footprint of 5,000 or 10,000 square feet,” Andersen said. “Compact facilities with high-end, very high-tolerance equipment. The Valley is married with smart engineers in the area.”

According to CLU’s forecast, the U.S. economic outlook is eroding rapidly, as the economy absorbs the impacts of the trade war on business investments and hiring decisions.

It is weak compared to almost any historical context such as the Great Recession from December 2007 to June 2009.

“The San Fernando Valley economy appears to be somewhat insulated from these broader macro-economic trends. It is insulated, but it is not immune,” according to the forecast. “Precipitous declines in business investment caused in large measure by the trade war, do impact the San Fernando Valley economy, if not as much as comparable geographies.”

The forecast report goes on to say the current administration in Washington D.C. simply does not possess a commitment to free trade and the considerable economic benefits that flows from it.

“As a result, we are skeptical that any agreement reached with China will be an improvement over the situation that existed prior to the current trade battle,” the forecast report says. “The Administration’s NAFTA-replacement, dubbed USMCA, is worse than the status quo. Tariffs have also now been in place long enough that it could take years to undo the harm that has already been done.

That harm will ultimately be felt, according to the report.

“The question is not whether these developments will impact the economy of the San Fernando Valley, but by how much,” according to the report. “We are making the claim at this time that the impacts will be muted relative to other regions of the United States.”