A bit less upbeat about economy

Everybody does forecasts, although some are worth paying closer attention to. Chris Thornberg of Beacon Economics has been quite bullish about the recovery - even when many others weren't - but the firm's latest update is noticeably more reserved about where things stand. While growth this year is expected to average 3 percent, which isn't too bad, the problem is in the headwinds that threaten to limit expansion. Check this out:

What this means is that, unlike any recession since World War II, the economic downturn will leave an everlasting mark on the U.S. economy. It has almost certainly shifted the long-run growth path of the nation permanently down to a lower path. But there are a couple things to keep in mind. First, too much focus has been put on the levels of the economy, and not enough on economic trends. Unemployment is falling, and incomes are rising. That is more important than whether unemployment is currently higher than we might want and incomes lower.

The report is pretty upbeat about California:

California had added back more than 320,000 jobs lost during the recession. Even more importantly, because of ongoing job losses in the Government sector, the overall increase indicates that private sector employment is doing even better. The state still has a long way to go to full recovery, but as Beacon Economics predicted throughout 2011, things continue to move in the right direction. The employment recovery includes almost every sector of California's economy. The Professional, Scientific, and Technical industry has led the way, adding more than 40,000 jobs over the past 12 months. Moreover, the Retail Trade, Administrative Support, and Leisure and Hospitality sectors, considered bellwethers of the economy, have all seen employment increase over the last year.