Watkins: GDP growth will return, but unemployment to remain high
California Lutheran University economist Bill Watkins has raised his forecast for the U.S. economy for 2010, but his outlook for California remains bleak.
Speaking at a City National Bank forecast breakfast March 3, Watkins said that he has raised his GDP forecast to 2.5 percent growth for 2010, up sharply from less than 2 percent last fall.
However, he said he did not expect job growth to return this year. California unemployment can be expected to remain above 12 percent this year, he said.
One bright spot for the state is retail sales, which are forecast to rise slightly this year.
City National Chief Executive Officer and Chairman Russell Goldsmith said the recovery’s slow pace reflects an “economic realignment” that will continue for some time. The realignment includes “fewer stores and more factories,” as well as entitlement reform and less dependence on the consumer.