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|April 14, 2021|
Forecast: Predicted economic recovery from pandemic robust
LOS ANGELES – (INT) - The first quarterly UCLA Anderson Forecast of 2021 expects robust growth for the U.S. and California as the COVID-19 pandemic abates.
• California’s unemployment rate for the first quarter of 2021 is expected to be 7.7%, and the average for 2021, 2022 and 2023 will be 6.8%, 5.1% and 4.1%, respectively
• UCLA Anderson economists produce special reports on COVID-19-induced changes within the health care industry
Any comparison of the timing of an economic recovery in California relative to other states must take into account that the state imposed more restrictive non-pharmaceutical interventions (including mask mandates, business closures and a ban on gatherings) than did many other states across the country. But, forecast director Jerry Nickelsburg writes, “Although the timing may be offset with California beginning a significant recovery later than some other states, we expect the California recovery to ultimately be, once again, faster than the U.S.”
In an essay on the California recovery, Nickelsburg says the leisure and hospitality sector will be the last to recover because of the depth of the decline in this sector and its reliance on international tourism. But he expects the recovery to come earlier in the business, scientific and technical services sector and in the information sector, owing to the demand for new technologies that support how we are working and socializing. Recovery will also be faster in residential construction, as California’s shortage of housing relative to demand drives new developments.
“The more rapid growth we forecast for the U.S. economy — in light of how mass vaccinations have affected pandemic restrictions on economic activity and taking into account the new stimulus package from Washington — will also lead to a more optimistic California forecast than in December,” Nickelsburg says.
Story Date: April 13, 2021