CERF: California growth continues to slow Policies constrain economy for the state and nation

The California Lutheran University Center for Economic Research and Forecasting released its 2017 Third Quarter California and United States Forecast on Thursday, Sept. 21. I

Highlights:

  • California’s economic growth has slowed compared to the nation. The forecast is for continued slowing, with GDP growth declining to just 2.3 percent over the next two years and just two-tenths of a percentage point higher than the nation’s. 
  • Job growth will slow to just 1.3 percent within the forecast horizon. If this comes to pass, the growth premium historically enjoyed by California will have vanished.
  • One of the drivers of California’s declining economic performance is the state’s housing affordability crisis. The only thing more disappointing than the crisis and its impact on residents is the legislative response underway.
  • Our outlook is for a U.S. economy that continues to be weak. GDP growth is predicted to average 2 percent over the forecast horizon. Non-farm job growth is predicted to average just 1.3 percent.  
  • Historically low interest rates are propping up the stock market, so it continues to reach new highs. This is not time to cheer. Various policies, and policy uncertainty, are distorting U.S. interest rates.
  • The U.S. unemployment rate is artificially low due to low labor force participation and does not indicate a healthy labor market.
  • We do not believe that the current legislative class or the presidential administration have the political skill or even the desire to fix obviously broken policies that are the primary causes of poor economic performance in the U.S. For this reason, our forecast of economic activity has been and continues to be pessimistic relative to history and the broader economic consensus.

Get Citizensjournal.us Headlines free  SUBSCRIPTION. Keep us publishing –DONATE

0 0 votes
Article Rating
Subscribe
Notify of
guest
3 Comments
Newest
Oldest Most Voted
Inline Feedbacks
View all comments
Camille Harris
Camille Harris
3 years ago

A one party government did not work for Venezuela either.

Camille Harris
Camille Harris
3 years ago

Is a one party government a good idea?

William Hicks
William Hicks
3 years ago

This is what I would expect from a State Government that is just an echo chamber of Brown/Obama policies.