TIMES ORANGE COUNTY POLL : Recession a Worry but Just 16% Call It Serious : Economy: Consumer confidence has withered for now, but outlook is brighter than in rest of nation.

Steven Redpath, a 28-year-old Huntington Beach resident, is so worried about shaving his expenses in a time of recession that he bakes his own bread instead of buying it at the store.

Like Redpath, four of five Orange County residents believe the economy is in the middle of a recession, though only one in six describes the downturn as serious, according to a Times Orange County Poll.

Puncturing the myth that nothing could shake the shop-till-you-drop buying habits of local consumers, the poll shows that the confidence of Orange County residents has withered since September, prompting people to cut back on daily expenses and postpone major purchases in the past six months.

“I look at my liquid savings right now and it’s getting smaller week by week,” said Redpath, who makes more than $35,000 a year as an engineer for one of Orange County’s biggest aerospace companies. “I’m concerned about the economy, and I’m trying to survive.”

Even the end of the Persian Gulf War did little to improve his outlook, Redpath said, and others interviewed in the poll voiced similar opinions.

Nonetheless, people in Orange County remain more optimistic than those in the rest of the nation, and more than half of them believe the recession will be over by the end of the year, according to the poll by Mark Baldassare & Associates in Irvine. The telephone poll of 600 adult Orange County residents was conducted March 21-24. The margin of error is 4%.

People in all income groups and professions have become convinced the economy is in a recession, in part by taking cues from their employers, who have been cutting back on expenses, instituting hiring freezes or laying off workers, Baldassare said.

In the past six months, 64% of employed residents said they have noticed tighter controls on company spending and 56% have seen hiring freezes. Forty-four percent have seen layoffs of employees and 39% have seen freezes on raises or cost-of-living adjustments.

Those most likely to have seen cutbacks are clerical and sales workers.

Orange County’s unemployment rate in February, the latest month for which figures are available, was 4.7%, well below the 6.5% national figure for that month but high compared to a 2.7% rate of a year ago. (The national rate rose to 6.8% in March, it was reported Friday.) James Doti, director of business forecasting at the Center for Economic Research at Chapman College in Orange, expects more job losses in the third and fourth quarters.

One in four residents expressed concern that they or a family member will lose their job during the recession, while 4% say they or a family member had already lost a job.

Jeanine Hashey, 27, of Anaheim said her family took a financial broadside when her husband, Steve, 40, lost his construction job last November. He found a comparable job last week at similar pay, but now the family is struggling to repay past debts--now three months overdue--and to meet the monthly mortgage.

“We were hoping to pay for college tuition for my husband’s daughter in the fall but now we’ll have to use financial aid,” said Hashey, who takes care of the four children. “We weren’t expecting this at all. We’ve had to ask creditors for breathing room.”

For now, the creditors, such as the private school that her children attend, have backed off and the Hasheys are recovering.

Not everyone, however, is as gloomy.

A positive signal from the poll is that three in 10 said things have improved at work since the war ended, and a majority expect better conditions at work in the next six months.

Blue-collar workers are less likely to have seen improvements since the war ended and are more pessimistic in their outlook compared to managers and other white-collar workers.

County residents are still more optimistic than most Americans, with only 16% of Orange County residents saying the recession is serious, compared to 21% in the rest of the nation.

Eighty percent of Orange County residents continue to describe their standard of living as either “more than comfortable” or “comfortable.” Still, that level is down seven percentage points from five years ago.

More than half believe the recession will be over before year’s end. Thirty-nine percent said they believed the recession would last into 1992, and 8% said they didn’t know when the economy would recover.

Robert Kilduff, 45, a survey respondent who runs a talent agency for models in San Clemente, believes the recession will be mild in Southern California compared to the rest of the country. He thinks the recession was created by the media’s influence on consumer attitudes.

“I think people also felt guilty about buying during the war, and they changed their attitudes as soon as it was over,” he said.

Jerald Mermelstein, 55, a retired aerospace worker in Laguna Niguel, said he believes the recession is mild here and that it is closely tied to the decline of the defense budget and its impact on local aerospace firms.

“There’s a psychological thing going on here,” he said. “I know people in aerospace who have been laid off, and they start thinking very quickly that their disposable income isn’t so disposable anymore.”

Mermelstein, who owns his home, has a comfortable pension and income from investments and therefore considers himself about the same financially compared to a year ago.

But regardless of how they believe the recession started, few Orange County residents believe the economy will catch its second wind before June, according to the poll.

Consumer confidence, a key measure of the health of the economy based on consumer perceptions of their financial well-being and buying plans, has slipped. Only a third of Orange County residents say they are better off now than a year ago, compared to 49% who thought they were better off in September, 1990, and 62% in March, 1988.

Orange County consumers have been on a serious diet in the past six months; nearly half said they have been cutting back on expenses by eating out at less-expensive restaurants, shopping at discount stores and renting videos instead of going out. Four in 10 have postponed a big-ticket purchase, a trip or buying a new car.

Donald Lecher, a 36-year-old sales representative for a hardware wholesaler in Anaheim, said he is worse off than he was a year ago, in part because he received a 3% pay cut effective April 1.

“It was said the media created this recession by publicizing it, but I don’t think that’s true,” he said. “I actually forgot about the recession when the war was on. But the numbers are there, and they say we aren’t going to get out of this quickly.”

Lecher said he had set aside $2,000 to buy a car, but once he saw the recession coming last fall he decided to hold off on the purchase for another year and save the money.

But looking forward, consumer spending may be back on the rise in the next six months, with half saying they expect to be better off a year from now. Four in 10 say they plan to make a big-ticket purchase in the coming six months, 70% plan to take a trip or vacation and two in 10 say they will be buying a new car.

“I think there will be a snowball effect as people start to do more things again,” retiree Mermelstein said. “I get out and play, and my plans haven’t changed any.”

Even Redpath, who has taken to baking bread to save money, gave in and bought a $1,000 bicycle two weeks ago that he had postponed buying last year.

He is putting off bigger purchases, however, such as making a down payment on a condominium.

“The bicycle is a lot less than a condo, but it’s something.”

LIFE ON THE EDGE: Many O.C. residents’ margin of financial safety is slim. D1

Times Orange County Poll: The Recession

“Do you think we are in an economic recession, or not? (if yes, do you think we are in a mild recession, or a moderate recession, or a serious recession?)” Orange County: Serious recession: 16% Moderate recession: 39% Mild recession: 25% No recession: 14% Don’t Know: 6% United States: Serious recession: 21% Moderate recession: 38% Mild recession: 29% No recession: 9% Don’t Know: 3% “When do you think the current economic recession will end?” (of those who think there is a recession today). End June ‘91: 8% Between July and September ‘91: 24% Between October and December ‘91: 21% January ’92 or later: 39% Don’t know: 8% Source: Times Orange County Poll and U.S. figures from Times Poll March 1991

How the Poll Was Conducted

The Times Orange County Poll was conducted by Mark Baldassare & Associates. The telephone survey of 600 Orange County adult residents was conducted March 21-24. The sample was statistically weighted to reflect the actual population distribution of Orange County residents. The margin of error for the total sample is plus or minus four percentage points at the 95% confidence level. That means it is 95% certain the results are within percentage points of what they would be if every adult resident were interviewed. All respondents were guaranteed anonymity; however, some of those polled agreed to be reinterviewed for these stories.