The Oregon Office of Economic Analysis predicts employment will decline an average of 5.3% this year and drop 0.7% in 2010, according to The Register-Guard, Eugene.

It isn’t until the first quarter of 2011 that Oregon’s economy will see job growth of more than 2%, according to the forecast.

State forecasters predict that the struggling transportation equipment industry, which includes manufacturers of trucks, boats, railcars and RVs, will take the biggest hit to employment this year. The state predicts job losses of 28% this year, then 5% next year before growth of 3.4% returns in 2011.

Lane County had built itself into a center for RV production, but its two dominant manufacturers of luxury motorhomes, Country Coach LLC of Junction City and Monaco Coach Corp. of Coburg, sought bankruptcy protection earlier this year. Country Coach is operating with just 94 employees, down from a peak of about 1,800 workers in 2006, and Monaco terminated all of its 2,000 employees when it filed for Chapter 11 bankruptcy protection in early March.

(Monaco was due back in a Delaware bankruptcy court today for the auction of its recreational vehicle division. Navistar International Inc. has offered $52 million for the business but company officials continue to decline to talk about why it has bid for the division and what its plans are. The court is scheduled to authorize the sale on Friday and complete the transaction on June 2.)

Other RV manufacturers nationwide are struggling. All manufacturers combined are forecast to ship 7,000 to 8,000 Class A motorhomes this year, said Frank Magdlen, an RV analyst with the Robins Group in Portland. Not long ago, Monaco alone shipped that many coaches in a year, he said.

“That’s how precipitous the drop was,” Magdlen said. He predicts that Lane County’s RV manufacturers will bottom out this year and begin a slow road to recovery in 2010 and 2011.

The industry’s return is predicated on consumer demand, he said. Consumers have to feel secure enough about their job prospects and finances to make the investment. Plus, financing has to be available.

RV financing should be stronger toward the second half of this year and back to more normal activity in 2010, Magdlen predicted.