ESCONDIDO -- San Diego County's economy is diverse and resilient, with more people employed and earning more money on average than in California or the nation overall, a senior economist with the Federal Reserve Bank of San Francisco said Wednesday afternoon.

Gary C. Zimmerman spoke to members of the Escondido Chamber of Commerce and other business people during a luncheon at the California Center for the Arts, Escondido, painting a picture of the California and San Diego County economies.

The Federal Reserve Bank of San Francisco is the headquarters of the 12th Federal Reserve District, which includes the nine western states -- Alaska, Arizona, California, Hawaii, Idaho, Nevada, Oregon, Utah and Washington -- and American Samoa, Guam and the Commonwealth of the Northern Mariana Islands.

Zimmerman told the 120 luncheon attendees that while California is doing well economically, San Diego seems to be doing even better. But, he warned, the county faces challenges in its high housing costs, and conversely, a slowing house appreciation rate that could affect real estate sales.

And like most Americans, San Diego County residents and other Californians are feeling the pressure of high gas prices, he said. But while this isn't enough to break most budgets, it certainly affects people's spending, Zimmerman said.

After asking how many people in the audience had changed their driving habits because of increasing gas prices, only two raised their hands.

"I assume that means that the rest of you have enough money, or for the bankers in the audience, enough credit, to continue driving," Zimmerman said.

But, he said later, the more people spend on gas, the less they spend on other things.

"For most states, higher energy prices are certainly a negative," Zimmerman said. "If we don't change our gas usage, how we drive, we'll have less money to spend."

This, in turn, puts stress on consumers' credit.

"When the credit card's maxed out, who pays for gas?" he said.

Among the indicators of San Diego County's economic strength are a strong commercial real estate market and an unemployment rate of 4 percent, as of December, one of the lowest in the state, Zimmerman said. The county's per capita income in 2003 was almost $36,000, higher than that of California and the U.S., he said.

Zimmerman said county employment was strongest in the construction, education and health, and leisure and hospitality industries. And while employment in most technology industries decreased from 2004 to 2005, employment in the aerospace industry grew by almost 6 percent.

Zimmerman showed the county's economic progress with charts and graphs and explained he was limited in what he could say about future prognostics because of an upcoming Fed interest rate announcement, disappointing many people in the audience.

Some listeners said that much of what they heard was nothing new, however, it did re-enforce some of their beliefs about California's economy.

"I think we can expect mortgage rates to rise, which will result in a slowdown in the housing market, which will cause unemployment," said Larry Hartwig, president and chief executive officer of California Community Bank in Escondido.

Which, he said, would be good in that the state would become less dependent on the construction industry.

Rosa Ruiz, a real estate agent with RE/MAX of Escondido, said she has had to tell many of her clients that they just can't expect the kind of return on home sales that they once could.

"Before we had very short supply, high demand. Now we have the opposite because people can't afford to buy homes," Ruiz said.

Contact staff writer Paul Eakins at (760) 740-5420 or peakins@nctimes.com.