Dec. 29--The ailing economy took its toll on York in 2008, bringing layoffs, record gas prices, a drop in home sales and a record number of foreclosures and sheriff's sales to the front page.

The economy was the top story of 2008. And while area economists, analysts and stock brokers have differing opinions about what 2009 will usher in, they agree the early part of the year is likely to bring more bad news.

"I don't see things really turning around until maybe late 2009," said Brian Davis, an economics professor at York College.

The auto industry will get some government money, but it's unlikely to get some car makers through second quarter of 2009, "so there will probably be another bailout for those guys," he said.

There are other problems, too, he said. Banks aren't lending the money the government gave them -- at least not as much as the government had hoped -- so people can't, for example, buy cars. The Federal Reserve is out of weapons to add more liquidity to banks, as interest rates have tumbled.

And while President-elect Barack Obama likely will get a stimulus bill passed, perhaps for as much as $1 trillion, that money might not be seen until the third quarter of 2009.

If sales don't pick up in the meantime, more companies are likely to enter bankruptcy, Davis added.

In Pennsylvania: Other experts say there's good and bad news for local residents.

Bad because Pennsylvania usually trails the nation in coming out of a recession, says

senior economic analyst Jason Novak of the Federal Reserve Bank of Philadelphia.

Good because the York area typically weathers the economic storm better than other areas of the state and nation.

Novak said that Pennsylvania exited the 2001 recession a year later than many states, judging by the jobless recovery rate. Statistics for past recessions show that Pennsylvania's economy suffered longer than the national average, by about four to six months, he added.

December 2007 marked the start of this recession in Pennsylvania, based on employment numbers, Novak said.

York's unemployment rate is likely to increase as the national rate increases, said Ryan Horner, an industry and business analyst for the state's Department of Labor & Industry. But he said he doesn't expect the York area to meet or exceed the national unemployment rate because the area generally outperforms the nation.

Analysts say the recession is likely to last through the first half of 2009, he said. Past recessions offer a measuring stick for the York area's unemployment, he said.

As a result of the 2001 recession, York's rate peaked at 5.3 percent, he said. The U.S. rate peaked at 6.3 percent. Pennsylvania peaked at 5.8 percent, he said.

This year, the jobless rate has jumped 1.4 percentage points so far, from 3.8 percent in January to 5.2 percent in October, "so we're almost to where we peaked in the last recession," Horner said.

He said he can't predict where York's rate will stop as a result of the current recession, but it will continue to increase if the national rate continues to increase.

-- Reach Christina Kauffman at 505-5436 or ckauffman@yorkdispatch.com.

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