The U.S. economy is in a recession expected to last through September, according to a revised forecast released Monday by UCLA that reflects rapid changes brought on by the coronavirus.
The university took the extraordinary step of revising its quarterly Anderson Forecast that was just released Thursday -- the first time in 68 years it has issued an update between regularly scheduled quarterly releases.
The first-quarter 2020 GDP growth forecast has been reduced to 0.4% given the escalating impacts of the pandemic, despite a strong start to the year.
The forecast predicts a resumption of normal activity in the fourth quarter, with GDP growth of 4%. The full year expectation is for a 0.4% decline, with a full recovery to trend by 2022.
Researchers made the revision after reviewing the 1957-58 H2N2 influenza pandemic. For California, given its larger reliance on tourism and trans-Pacific transportation, the downturn is expected to be more severe, according to the forecast.
Employment is expected to contract by 0.7% overall this year, with unemployment rising to 6.3% by the end of this year and increasing into 2021.