The Sacramento Mayor's office released a report by the Sacramento State business school this past Tuesday stating that the rest of the nation should see signs of economic recovery by late 2009 into 2010, but Sacramento will lag behind the curve. Largely due to the budget chaos gripping the California capitol, it is not anticipated that Sacramento will see signs of recovery until well into 2010.
Sanjay Varshney, the dean of the College of Business Administration at Sacramento State made the following statement: "Having a huge government presence in Sacramento acted as a cushion, but the very advantage we had is turning into a disadvantage." Additionally, the "economy is much worse than expected" and said the Sacramento area will have a 13.5 percent unemployment rate by early 2010.
Large and small business relocations out of the city have caused an unprecidented 21 percent vacancy rate in office space within the city, and government layoffs and cut backs are expected to cause more than 20,000 lost jobs in Sacramento over the next 12 months. One year from now the city's expected unemployment rate will likely be between 13% and 15%.
Mayor Kevin Johnson says, "Sacramento is not looked upon as a cutting edge city to do business in, the perception is that we're bureaucratic, we're kind of slow to change."
Marketing Sacramento's positive offerings, and diversifying the types of businesses in the city is about the only things that can turn this situation around. Officials and economists are hopeful that innovation and the need for change will spur on new opportunities. This presents a wonderful opportunity for those with entrepreneurial mindsets and out-of-the-box thinking, and those wishing to start new ventures in the city.
According to officials, industries such as manufacturing, education, technology and green businesses are especially prime targets to lure to Sacramento.
Despite the doom and gloom, all of these factors may add up to incredible opportunity for those willing and able to step out on faith and take advantage of the situation. Given the high vacancy rates, landlords are willing to negotiate on pricing for space, and the city is hungry for new ventures. Those with a mind to start a business may find this an opportune time, as long as they have thoroughly researched the market, and are ready to offer innovative and progressive products and services.
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