California economy FALLS to 35th! HOW!

More evidence of a cooling California economy: The state has slipped down the rankings of overall business growth.

The latest federal government report on state-by-state gross domestic product — the broadest measure of business output — shows California’s economy growing at a 2.1 percent annual pace in the second quarter. Yes, that’s still growth. Plus, it’s up from a very slow 0.6 percent in the previous quarter. But don’t forget that it’s also down from 3.7 percent a year ago.

Here are seven trends to ponder about the state’s economic chill:

1. Not average results: The springtime improvement was not enough to get California back above the national growth rate. U.S. GDP grew at a 2.8 percent annual rate in the second quarter, by this measurement, as California’s growth ranked 35th among the 50 states.

2. Not 2016: Last year, California’s economy grew at a 3.3 annual pace. That was fourth-best among the states and more than double the nation’s 1.5 percent growth. Talk about a letdown!

3. Not a surprise: This California GDP slowdown is in line with other economic metrics. Job creation, for example, is running at a 1.6 percent pace statewide this year — slowest in five years. And total wages paid in California increased at a 3.5 percent annual pace in the second quarter, second slowest since 2013.

4. Not a great outlook: California had the 10th worst economic prospects among the states in August and 13th worst in September — the state’s lowest rankings since 2010. That’s according to a monthly, forward-looking index from the Federal Reserve Bank of Philadelphia that tracks six-month outlooks for each state’s growth.

5. Not just our problem: California’s sluggishness should also be a national worry. Its GDP totaled $2.7 trillion in the second quarter or roughly one-seventh of the entire nation’s business output. Since the recession, the state has been an economic leader: From 2010 through 2016, California averaged 3.1 percent-a-year GDP growth.

Get the rest at: California Economic Chill

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