EVEN MORE: HIGHLIGHTS FROM THE 2009 OC COMMUNITY INDICATORS REPORT

HOUSING AFFORDABILITY NEARLY DOUBLES

Description of Indicator
This indicator measures the value and change in value of the
median-priced existing single-family detached home. It uses the
California Association of Realtors Housing Affordability Index
to measure the percentage of households that can afford the
existing median-priced single-family detached home in Orange
County. It also compares homeownership rates.

Why is it Important?
High relative housing prices adversely impact businesses’ ability
to attract and retain workers. A shortage of affordable housing,
particularly for first-time buyers, discourages young workers
from moving to or remaining in Orange County. In addition,
a lack of affordable housing results in longer commutes, leading
to increased traffic congestion and pollution, decreased productivity
and diminished quality of life. Homeownership increases
stability for families and communities and is a significant means
of personal wealth creation.

How is Orange County Doing?
The single-family median home sale price is significantly less
than the previous year, although still out of reach for many:
• In July 2008, the median sale price of an existing singlefamily
detached home in Orange County was $537,570, down
$172,150 or 24% since July 2007.
• This price is still nearly $200,000 more than the state median
price for a comparable home in July 2008.

Housing affordability nearly doubled since last year:
• The minimum household income needed to purchase a median-priced
single-family home in Orange County is approximately $78,100.1
• As of the second quarter of 2008, 41% of households in
Orange County could afford an existing single-family
detached home that was priced at 85% of median (or
$456,900).
• This is significantly higher than the 23% able to afford the
same home in 2007.
• Orange County’s affordability rate is consistent with San
Diego and Los Angeles counties.
• Neighboring Riverside and San Bernardino counties remain
more affordable with housing affordability rates of 59% and
63%, respectively.

Homeownership rates rose slightly:
• Homeownership rates for Orange County rose from 62.4% in
2006 to 62.7% in 2007.
• Orange County has similar levels of homeownership as many
of our peer regions, but still lags behind the national rate by
approximately 4.5%.

[from page 23]
**
Housing Wage Drops for First Time

Description of Indicator
This indicator measures the Housing Wage – the hourly wage a resident needs to afford “Fair Market Rent” (the median rent in the Orange County market).

Why is it Important?
Lack of affordable rental housing can lead to overcrowding and household stress. Less affordable rental housing also restricts the ability of renters to save for a down payment on a home, limiting their ability to eventually become homeowners and build personal wealth through housing appreciation. Ultimately, a shortage of affordable housing for renters can instigate a cycle of poverty.

How is Orange County Doing?
Orange County’s Housing Wage decreased in 2009:
• For the first time since tracking began, the hourly wage needed for a one-bedroom apartment fell – from $25.57 in 2008 to $24.92
in 2009. This Housing Wage is equivalent to an annual income of $51,840.
• The hourly wages needed to afford two- and three-bedroom apartments also declined.
• Despite decreases in Housing Wage levels, Orange County has the second highest Housing Wage (less affordable rental housing)
compared to state and national peer metropolitan areas.

Renting in Orange County

Fair Market Rent (Monthly)
----------------2008 - 2009
One Bedroom ----$1,330 $1,296
Two Bedroom ----$1,595 $1,546
Three Bedroom --$2,282 $2,188

Amount a Household Earning Minimum Wage
Can Afford to Pay in Rent (Monthly)
2008: $416
2009: $416

Number of Hours per Week a Minimum Wage
Earner Must Work to Afford a One-Bedroom
Apartment
2008: 128
2009: 125

Source: Orange County Business Council analysis of U.S. Department of Housing and Urban Development Fair Market Rent (www.huduser.org/datasets/fmr.html) using the methodology of the National Low Income Housing Coalition (www.nlihc.org), and California Employment Development Department (www.calmis.ca.gov)

[from page 24]
**

MORE HIGHLIGHTS: 2009 OC COMMUNITY INDICATORS REPORT

[NOTE: YOU MAY DOWNLOAD A FREE PDF COPY OF THE 2009 OC COMMUNITY INDICATORS REPORT HERE]

Largest Clusters Split Between Growth and Decline

Description of Indicator
This indicator shows employment and salaries in 10 major
Orange County industry clusters. The clusters were chosen
to reflect the diversity of Orange County employment,
major economic drivers within the county, and important
industry sectors for workforce development. Approximately
40% of all Orange County jobs can be found in the 10 clusters
described in this indicator.

Why is it Important?
Employment change within specific clusters illustrates how
Orange County’s economy is evolving. Tracking salary levels
in these clusters shows whether these jobs can provide a
wage high enough for workers to afford to live in Orange
County.

How is Orange County Doing?
Between 2006 and 2007, employment grew in seven of the
10 major industry clusters:
• Two of the largest clusters –Tourism and Health Services
– were part of this growth.
• The other two largest clusters – Business and Professional
Services, and Construction – experienced employment declines.
• Computer Hardware also experienced a decline.
• The largest employment gains occurred in Communications
(19.2%), Energy and Environment (11.5%), and Computer Software (6.4%).
Eight of the 10 major Orange County industry clusters
experienced salary increases between 2006 and 2007:
• The largest salary increases occurred in Communications
(11.8%), and Energy and Environment (8.8%).
• The two industries experiencing salary reductions were
Computer Software (-1.1%) and Biomedical (-3.1%).
• As presented in the Housing Affordability indicator, the
annual income needed to purchase a median-priced home
in Orange County is $78,100, affordable only to the top
three paying clusters.
• Despite salary increases, three of the four largest clusters
do not have an annual income high enough to afford
median rent on a one-bedroom apartment (estimated at
$51,840 in the Rental Affordability indicator).

**
Average Annual Salaries in Orange County Clusters
Orange County, 2007 Job Market

------------------------------------2007------------Change 2006-07
Defense and Aerospace -------------$95,199 -------------------6.7%
Computer Software -----------------$82,630 -----------------(-1.1%)
Biomedical ------------------------$80,198------------------(-3.1%)
Computer Hardware -----------------$70,432 --------------------1.7%
Communications --------------------$69,694 -------------------11.8%
Energy and Environment ------------$59,292 --------------------8.8%
Construction ----------------------$53,581 --------------------7.3%
Business and Professional Services $51,349 --------------------5.2%
Health Services -------------------$47,124 --------------------3.0%
Tourism ---------------------------$20,197 --------------------5.8%

Source: Orange County Business Council analysis of data from the California Employment
Development Department

[from page 21]
**
Economic Contraction Narrows Housing Gap

Description of Indicator
This indicator shows the ratio of new housing permits divided by new jobs created in Orange County compared with peer metropolitan
areas across the state and the country.

Why is it Important?
When an economy is growing, new housing is needed for the additional workers employed. When the housing demand is unmet, it can drive up home prices and apartment rents beyond what is affordable to many workers and residents. An expensive housing market
affects Orange County’s desirability as a business location partly because businesses have greater difficulty attracting and retaining workers — particularly young workers. In addition, residents face longer commute times due to people moving out of the county or to a small concentration of affordable areas within the county. Orange County’s housing deficit is the result of a long-term chasm between the amount of housing built relative to the number of jobs created. Even when the economy contracts, the gap is so wide that demand for new housing does not disappear. To begin to close a gap of this size, housing construction must increase and remain high in times of economic growth as well as contraction.

How is Orange County Doing?
Despite a significant decline in employment, the long-term housing
shortage that has existed in Orange County since the late-1990s
continues due to weak housing development:
• In 2007, employment dropped by 28,200 jobs while 7,372 new
housing permits were granted.
• The resulting ratio of -3.83 leaves Orange County with a
negative number of jobs (job losses) per new housing permit.
• This is in contrast to peer regions around the country (except for
the Inland Empire and Los Angeles) where job growth continued
in correspondence with housing permit growth.
• Still, since 1999, a total of 162,100 new jobs were created (including
losses) compared with 78,800 housing units permitted.
• In other words, for every 1.8 jobs created since 1999, one housing
unit has been permitted. The standard “healthy” ratio of jobs to
permits is 1.5 jobs per housing unit.
• All peer areas compared granted more housing permits than Orange County in 2007.

[from page 22]
**

HIGHLIGHTS FROM THE 2009 OC COMMUNITY INDICATORS REPORT

[NOTE: YOU MAY DOWNLOAD A FREE PDF COPY OF THE 2009 OC COMMUNITY INDICATORS REPORT HERE]

Housing Continues to Drive High Cost of Living
2009 ECONOMIC AND BUSINESS CLIMATE

Description of Indicator
This indicator uses a cost of living index to compare prices of housing, consumer goods, and services for Orange County and peer
metropolitan regions. The weighted index compares local market prices in the following areas:
• Housing (28%) • Groceries (13%)
• Utilities (10%) • Transportation (10%)
• Health care costs (4%) • Miscellaneous items (35%)

The average for all 300 metro areas analyzed equals 100 and each area’s individual index is read as a percentage of the average for
all places.

Why is it Important?
A high cost of living relative to peer markets can make Orange County less attractive
as a destination for businesses and workers. In addition, businesses already operating in Orange County may opt to relocate or expand elsewhere. Current residents – particularly young workers – may decide to move to more affordable areas.

How is Orange County Doing?
In the second quarter of 2008:
• Orange County’s cost of living was the third highest of our peer regions, which are
among the highest of the 300 metro areas analyzed in the index.
• San Francisco and San Jose were the only markets more expensive.
• With 100 being average, Orange County measured 155.8 on the index (up from
154.9 last year).
• Orange County’s cost of living measures for groceries, utilities, transportation and miscellaneous items tended to rank in the middle among peers, but high housing
costs significantly affected the index, making Orange County’s score among the
highest.

[from page 19]
**
High Average Income and Growth Rate in 2006

Description of Indicator
This indicator measures per capita income levels and income
growth. Total personal income includes wages and salaries,
proprietor income, property income, and transfer payments, such as
pensions and unemployment insurance. Figures are not adjusted for
inflation.

Why is it Important?
A high per capita income for residents is crucial in the context of
Orange County’s high housing costs. In addition, a higher relative
per capita income signals greater discretionary income for the
purchase of goods and services.

How is Orange County Doing?
Orange County boasts fast income growth in recent years:
• In 2006, Orange County’s per capita income of $48,209 was
higher than the state and national averages and up 6.0% from
$44,465 in 2005.
• When compared to peer and neighboring markets, Orange
County has the fourth highest per capita income, trailing only
San Jose, Boston and Seattle.
• Between 1997 and 2006, Orange County posted a per capita
income growth of 5.1%, which is faster than all peer regions
compared except for San Diego.
• Over this same 10-year period, the average inflation rate was
2.5%, which should be taken into account when interpreting
these income growth percentages.
• As the country slips into recession, per capita income is
anticipated to decline.

[from page 20]
**

SAYING GOODBYE TO THE MIDDLE CLASS

The following are 15 shocking poverty statistics that are skyrocketing as the American middle class continues to be slowly wiped out....

#1 Approximately 45 million Americans were living in poverty in 2009.

#2 According to the Associated Press, experts believe that 2009 saw the largest single year increase in the U.S. poverty rate since the U.S. government began calculating poverty figures back in 1959.

#3 The U.S. poverty rate is now the third worst among the developed nations tracked by the Organization for Economic Cooperation and Development.

#4 According to the U.S. Department of Agriculture, on a year-over-year basis, household participation in the food stamp program has increased 20.28%.

#5 The number of Americans on food stamps surpassed 41 million for the first time ever in June.

#6 As of June, the number of Americans on food stamps had set a new all-time record for 19 consecutive months.

#7 One out of every six Americans is now being served by at least one government anti-poverty program.

#8 More than 50 million Americans are now on Medicaid, the U.S. government health care program designed principally to help the poor.

#9 One out of every seven mortgages in the United States was either delinquent or in foreclosure during the first quarter of 2010.

#10 Nearly 10 million Americans now receive unemployment insurance, which is almost four times as many as were receiving it in 2007.

#11 The number of Americans receiving long-term unemployment benefits has risen over 60 percent in just the past year.

#12 According to one recent survey, 28% of all U.S. households have at least one member that is looking for a full-time job.

#13 Nationwide, bankruptcy filings rose 20 percent in the 12 month period ending June 30th.

#14 More than 25 percent of all Americans now have a credit score below 599.

#15 One out of every five children in the United States is now living in poverty.

As millions more Americans continue to climb on to the "safety net", how long is it going to be before it breaks?

The reality is that the system can only support so many people. We are now at a point where our anti-poverty programs are clearly unsustainable in the long-term, but nobody has a solution for how we are going to get all of these people off of these programs or how we are going to provide good jobs for all of them.

The cost of every U.S. government anti-poverty program is absolutely soaring. Meanwhile, the U.S. government is already running a budget deficit that is approaching 1.5 trillion dollars every year. If you cannot understand that we have a very serious problem on our hands then you are probably not awake.

[TAKEN FROM THE ARTICLE LINKED BELOW]
HERE

POVERTY IN THE O.C. (One Family's Story)

SAN CLEMENTE – Allen Pederson pulls into a parking slot at San Clemente State Beach, hoping he gets a meter with a little time left.

Renting by the hour with a few coins is all he can do now. This 1998 white Ford van is Pederson's real estate reality; 25 square feet he calls "our little apartment."
Beside Allen is his wife of 21 years, Regina. This was her vehicle, the one she used to drive the couple's three kids to church, the one with the "Best Mom" license plate frame intact.

It's sunset on a recent Thursday, and the couple sits down on a park bench on the bluff overlooking the ocean, and Allen jokes that this is his living room. Dinner is from Taco Bell, a tostada, burrito and Diet Coke eating up most of the last $5 Allen had in his wallet.

This is all the Pedersons have left of what Allen called "the Orange County Dream." They have lost everything since Allen lost his job in 2005, an event that triggered a domino effect of decline for the family, down to being homeless and what Allen admits is now day-to-day survival.

"It's just kinda like, where did it go? It was just there. It happened so fast! You think, 'It will never happen to me.' I think back, how did it happen?" Allen says. "How did this happen?"

READ FULL ARTICLE FROM THE OC REGISTER
HERE

THE CHARITABLE GIVING DIVIDE

Who gives more to those in need; the rich or the poor?

[EXCERPT FROM ORIGINAL ARTICLE]
For decades, surveys have shown that upper-income Americans don’t give away as much of their money as they might and are particularly undistinguished as givers when compared with the poor, who are strikingly generous. A number of other studies have shown that lower-income Americans give proportionally more of their incomes to charity than do upper-income Americans. In 2001, Independent Sector, a nonprofit organization focused on charitable giving, found that households earning less than $25,000 a year gave away an average of 4.2 percent of their incomes; those with earnings of more than $75,000 gave away 2.7 percent.

This situation is perplexing if you think of it in terms of dollars and cents: the poor, you would assume, don’t have resources to spare, and the personal sacrifice of giving is disproportionately large. The rich do have money to spend. Those who itemize receive a hefty tax break to make charitable donations, a deduction that grows more valuable the higher they are on the income scale. And the well-off are presumed to have at least a certain sense of noblesse oblige. Americans pride themselves on their philanthropic tradition, and on the role of private charity, which is much more developed here than it is in Europe, where the expectation is that the government will care for the poor.

READ THE FULL ARTICLE
HERE

THIS MONDAY: HBO FILMS PRESENTS "HOMELESS: THE MOTEL KIDS OF ORANGE COUNTY"

Premieres This Monday, July 26th at 9pm on HBO

About this documentary
HOMELESS: THE MOTEL KIDS OF ORANGE COUNTY explores the world of children who reside in discounted motels within walking distance of Disneyland, living in limbo as their families struggle to survive in one of the wealthiest regions of America.

The parents of motel kids are often hard workers who don’t earn enough to own or rent homes. As a result, they continue to live week-to-week in motels, hoping against hope for an opportunity that might allow them to move up in the O.C.

For more information on the show - AND TO WATCH A TRAILER OF THE FILM:
GO HERE