According to the latest UCLA Anderson Forecast, California is expected to see a year of below-average economic growth in 2024. However, this will be followed by two years of higher growth rates than the rest of the country, driven by advancements in technology and aerospace industries. The current slower growth can be attributed to weaknesses in specific sectors within California, as evidenced by its high unemployment rate.
In 2023, California’s GDP grew at a compound annual rate of 3.7%, surpassing all but three states: Washington, Florida and Texas. However, in the second quarter of 2024, the state’s annualized growth rate was only 2.8%, slightly lower than that of the US.
UCLA Anderson predicts that while California’s economy will continue to outpace national trends in both 2025 and 2026 , it may not do so significantly.”The forecast identifies potential risks from political and geopolitical factors,” states UCLA Anderson . On a positive note , increased international immigration and onshoring efforts for technical manufacturing could potentially boost economic growth.
Overall , according to UCLA Anderson Forecast data , we can expect subpar economic performance from CA during most part s o f t he y ear i n o ur forecasted period (specifically for fiscal year ending December/January). This trend is likely due t o w eaknesses i n c alifornia’s s pecific sectoral industry(ies) which have resulted into high unemployment rates across various regions within CA . Despite these challenges however there are also opportunities for accelerated expansion through technological advancements such as onshoring initiatives or an increase d focus on attracting skilled immigrants – both factors which could contribute positively towards future economi c g rowth p rospects.
