Forecasters See Bleak Economy For California --- UCLA Group Downgrades View, Citing Added Cost From Los Angeles Riots
LOS ANGELES -- An influential economic analysis group has sharply downgraded its outlook for the California economy in the wake of the Los Angeles riots.</br></br>Despite mildly improved prospects for the national economy this year, the forecast for the California economy has become bleak, according to the University of California at Los Angeles Business Forecasting Project.</br></br>"While the halting recovery continues nationally, California seems firmly mired in its recession," said David Hensley, director of the project. "The recent Los Angeles riots have convulsed the region and further damaged its economy," Mr. Hensley said in the forecasting project's last quarterly report.</br></br>The Los Angeles riots, in which dozens of people died, are estimated to have caused about $750 million in property damage. Hundreds of commercial outlets were burned and looted in violence in late April and early May that followed the acquittal of Los Angeles police officers accused in the beating of a black motorist, Rodney King.</br></br>In its new projections, the UCLA Forecasting Project concludes that personal income in California, a major subset of the region's "domestic product," will grow 2% on average this year and 5.8% next year. In March, the project forecast a 2.4% increase in personal income this year and a 6.8% increase next year.