Why 12 new people are settling in L.A. each hour

The Mr. Olympia of American counties - which became a 98-pound weakling during the early 1990s - is back on Muscle Beach.

Just five years ago, Los Angeles County was losing so many people it was the fastest-shrinking area in the nation. But now, fueled by immigration, young migrants from other states, and new jobs in a reinvented regional economy, it has roared back to become the fastest-growing US county.

In a reversal-of-fortune tale, overcoming recession (and a litany of natural and manmade disasters that included drought, earthquakes, mudslides, riots, and fires), Los Angeles County's net gain of 106,182 in 1999 edged out perennial winners Maricopa (Phoenix) and Clarke (Las Vegas) Counties.

The story underscores California's fortified economic future - and reinforces the county's draw as a center of assimilation for immigrants.

"This is a very significant turnaround, when you consider that for most of the last decade, L.A. County was the nation's most-watched exodus," says Marc Perry, spokesman for the US Census Bureau, which released the figures last week. "This has really become a tale of two counties."

The numbers also serve to assuage fears that California's position as an economic megastate - by itself the world's seventh-largest economy - had peaked and was leveling out.

"It is now clear that southern California's problems of the early 1990s were a one-time fluke, not a permanent pattern," says Steve Levy, director of the Center for the Continuing Study of the California Economy in Palo Alto. "More expansion is the future, not contraction."

Turnaround economy

Of the factors responsible for the turnaround, the economy ranks No. 1, say Mr. Levy and others. The state and region fell harder and further into recession in the early 1990s than most of the US. But in the recovery, L.A. County gave up decades of dependence on defense and aerospace jobs, and expanded into digital technology that fuels the entertainment and theme-park industries worldwide.

Jobs in firms that create special effects for movies and video games - dubbed "SiliWood" (a combination of Silicon Valley and Hollywood) - have helped stanch the outflow of middle-class workers.

The region's job picture has also become more diversified, with Los Angeles-Long Beach becoming the leading US port for international trade. The region is also hitting all-time highs in non-high-tech manufacturing, from wood to chemicals to toys.

"The most significant change ... is that jobs have kept people from leaving," says Jack Kyser, director of the Los Angeles Economic Development Corp.

There are also intangibles. Sixty-four billion dollars of post-earthquake investment has improved vast stretches, from retail districts to highways. And through a marketing partnership, the region coordinated its efforts to highlight those improvements.

The effort has helped to counter the steady stream of bad publicity that has been beamed nationwide regarding racial and police-related problems - from the Rodney King trials through the O.J. Simpson case to the current Rampart scandal.

"People who visit here are always shocked to find a multifarious quilt of vibrant, diverse communities that shatter the preconceptions they have had through the national media," says Joel Kotkin, an economist at Pepperdine University.

The area is not without problems. The recently announced sale of the Los Angeles Times to a Chicago-based corporation highlights a trend of acquisition or exiting of major corporate headquarters. Those include Bank of America by a North Carolina company and First Interstate Bank by Washington Mutual.

In fact, only one Fortune 500 company remains based in downtown - Atlantic Richfield (ARCO) - but even it is facing acquisition in a proposed deal with BP Amoco.

"The region is becoming a colony of the global economy," says California historian Kevin Starr.

Other observers lament the trend. "Los Angeles over the past couple of decades has really lost its civic elite," says Sue Horton, editor of LA Weekly. "We live in a town of declining institutions and shrinking numbers of people willing to invest of themselves and their fortunes in the city and its future. [The Times sale] continues the trend in a particularly disturbing way."

Magnet for immigrants

The other factors causing growth here are related: immigration, in-migration of younger Americans, and natural increase through births.

"Los Angeles is still the biggest draw in America for both legal and illegal immigration," says Ira Mehlman of the Los Angeles bureau for the Federation for American Immigration Reform. "Its sheer economic size and huge population give it the right critical mass where immigrants feel they can come to America and blend in most easily."

That magnet is so strong, say others, that a burgeoning micro-economy is developing in which immigrants work in low-skilled jobs with no benefits for a fraction of the cost of US natives.

In a study released last week by the Santa Monica, Calif.-based Milken Institute, demographer Robert Frey holds that just a few melting-pot regions in the US will continue to attract the majority of immigrants.

"Immigration will keep this county growing fast," says Mr. Frey, who has coined the term "multiple melting pot" to describe the phenomenon at work here, Florida, Texas, and the eastern seaboard. "It will be an incubator for new groups of workers and a new kind of economy."

(c) Copyright 2000. The Christian Science Publishing Society