California Economy Should Look Golden by 2011
California’s economy won’t see any major recovery until the end of 2010 or early 2011, but unemployment rates will still remain in double-digit territory, according to the UCLA Anderson Forecast.
For the rest of this year, economists predict little or no growth in California, but that will start to turn around in 2010.
“The keys to California’s recovery remain a recovery in U.S. consumption, which increases the demand for Asian imports and for products from California’s factories, increased public works construction, and increased investment in business equipment and software,” wrote UCLA Anderson Forecast senior economist Jerry Nickelsburg in the quarterly look ahead released on Sept. 16.
He believes the state’s unemployment rate will climb to 12.2 percent in the fourth quarter of 2009 and average 11.6 percent for this year. Although the state’s economy will be growing by 2011, it won’t be enough to push unemployment levels below double-digit figures before the end of that year.
When it comes to personal income, wages are expected to slip 1.5 percent this year before growing 0.5 percent in 2010 and 3.4 percent in 2011.
There was some encouraging news for manufacturers. Manufacturing job loss eased in July because non-durable goods manufacturing added jobs over the last three months and job loss in durable goods leveled off.
But such areas as retail and transportation and warehousing are still having a hard time because consumers are reluctant to start spending.
Yet, California exports are up for agricultural goods, computers and electronics to countries such as Japan, France and Germany, which emerged from their recessions in the second quarter.—Deborah Belgum
