Leading Economic Forecast Pushes Back Against “Doom and Gloom” Prophecies
LOS ANGELES , March 27, 2024 /PRNewswire/ — California is far from becoming the ‘failed state’ depicted by critics, and even a cursory look at the data proves it, says one of the state’s leading economic forecasts. According to Beacon Economics‘ latest outlook for California, the state’s economy will continue to grow in the near future and there is little sign of a recession in 2024.
Consider a few of the new forecast’s findings:
- Since prior to the pandemic, the number of jobs in California has grown by only 2.1%, compared to 3.7% in the nation as a whole, however the state’s private sector output has grown by 10% compared to just 8% in the nation. This means that California’s output has expanded through greater worker productivity.
- California’s median household income grew by 9.2% from 2019 to 2022, compared to just 8% growth in the nation. Median incomes in the state are now 14.3% higher than in the U.S. as a whole, the largest gap ever seen in this data.
- Real income (accounts for inflation) has increased despite persistent claims to the contrary. Official data from the U.S. Bureau of Labor Statistics shows a 20% increase in consumer prices in California between the end of 2019 and the end of 2023, but a 23% increase in workers’ average weekly earnings over the same period. Importantly, the earnings growth has been greatest among lower skilled workers.
- From 2019 to 2022, the average poverty rate in California was 12%, lower than the U.S. average and the lowest level ever seen in the state.
The new forecast is careful to acknowledge California’s glaring problems, including its housing shortage and massive budget deficit, but argues that untruthful and excessively negative narratives are making things materially worse by affecting the way leaders spend their time and do their jobs. “The state’s economy certainly has its share of problems, but many of these issues are things that can be solved with some pragmatic changes to state policy,” said Christopher Thornberg, Founding Partner of Beacon Economics and the forecast author. “When pessimistic public narratives take hold, no matter how false or overblown, elected leaders tend to veer off on impractical missions to fix problems that don’t really exist – at least not in the way these artificial narratives say they do.”
View the new Beacon Outlook.
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SOURCE BEACON ECONOMICS
