Sep. 27--By such measures as unemployment, foreclosure rates and median home prices, few states have been as dramatically affected by the worst recession in modern times than California. And few parts of the state have taken as hard a blow in the downturn as the Mid-Valley region.

Economists and local economic experts said there's no mystery about what happened, and there's also no mystery about what will bring the economy back: Good, old-fashioned jobs.

"We're seeing people really interested in the area," said Steve Carrigan, vice president of economic development for the Yuba-Sutter Economic Development Corporation. "The signs are starting to show positive."

"Are we coming back? I think yes. But slowly."

As the economy recovers, though, Carrigan and others said it's likely to do so in a different manner than the last economic boom of a half-decade ago, which launched an explosion in real estate prices.

Hundreds of homeowners locally and elsewhere took advantage of new loan options, allowing them buy houses beyond their means. Others took equity in their homes and turned it liquid, enabling them to boost their consumer spending.

When prices fell and the loans began to sour, housing plummeted, leading to losses of jobs in construction, retail and other sectors. California is in the top five states nationally for unemployment rate and was second highest at the start of 2009 in foreclosure rates, according to RealtyTrac.com.

And in this area as in Stockton, Modesto and other recently infamous housing bubbles, the burst was dramatic.

"It's an old story, but it's still the main story," said Jeffrey Michael, director of the Business Forecasting Center at University of the Pacific in Stockton. The center studies economic trends in the Central Valley and California.

"What we saw last fall was the recession spread across all sectors of the community. No area is unscathed," he said.

In Yuba-Sutter, the examples of the recession's effects can be seen in everything from the closure of longtime retailers Mervyns and Gottschalks to an unemployment rate of nearly 20 percent, among the highest of any metropolitan area nationally.

Housing's decline is so stark, Carrigan said, he doesn't expect starts to rebound significantly until 2014 or later.

But he's bullish on the regional economy in other ways. With the relatively low cost of living, lots of land and other incentives, the region could have a leg up in attracting manufacturing jobs in the next few years, he said.