Local government leaders are warning that California's' jobless rate could go much higher than the last month's 8.4 percent unless state lawmakers reach a budget agreement.
Billions of dollars in public works projects statewide are being put on hold until California is credit-worthy in the bond market.
San Diego County could see transportation, education and housing projects worth a billion dollars suspended because of the budget impasse.
That translates to the projected loss of least several thousand jobs, officials said.
"I strongly urge state officials, our state legislators, to agree on a budget," County Supervisor Greg Cox said during a news conference Friday following a San Diego Association of Government (SanDAG) meeting.
"A delay only causes further harm to our fragile region. We need a budget, and we need it now."
SanDAG is sending a $7.4 billion 'wish list' of projects in a funding application aimed at the Obama Administration's economic stimulus program.
But what they really need for Christmas is uninterrupted state bond money to maintain the $300 million 'managed lane' construction project along 20 miles of Interstate 15.
"It (state money) will instead be going to lawsuits, delay claims from contractors, and then what's left over might be able to go towards the improvement of our infrastructure," said Encinitas Mayor Jerome Stocks. "This is really not good business."
Also facing suspension is Prop. 1C funding to complete Father Joe's Villages' highrise affordable housing project at 16th and Market Street, which is a month away from an occupancy permit.
Father Joe's Villages also needs $12 million to begin work on another highrise village at 15th and Commercial -- one of more than two dozen affordable housing projects countywide that have been stalled by the budget deadlock or state's economic crisis in general.
"There's a whole lot of children out there, a whole lot of families without housing," said the nonprofit agency's namesake, Fr. Joe Carroll at a news conference near the project site in East Village. "They go through a referral a referred program like St. Vincent's, and need to get into all these housing projects.
"We strongly advocate, let's get this stimulus package focused not only on banks and autos, but people who need housing throughout the United States. Particularly in San Diego County."
Added San Diego City Councilman Todd Gloria: "We know that this economic downturn began in the housing market. The reality is that housing can help lead us our way out."