The US is already in the throes of a coronavirus-related recession that will last into September, economists at UCLA's Anderson School of Management said.
The school revised its Anderson Forecast on Monday, just one week after projecting a recession would start later in the year.
After starting 2020 strong, "escalating impacts of the coronavirus pandemic" have dragged first-quarter GDP growth to 0.4% and second-quarter growth to -6.5%, the economists said in a press release.
California will be hit harder than the rest of the nation and lose more than 280,000 jobs by the first quarter of 2021, they added.
As numerous banks call for the US to enter a recession by the summer, economists at UCLA say they're already months late.
The university revised its Anderson Forecast on Monday to reflect the national economy has already stopped growing and will remain in recession until October. The update arrives one week after UCLA's forecast projected a recession starting later in 2020.
UCLA issued the revision after incorporating more recent economic data and reviewing the economic effects of the 1957-1958 H2N2 epidemic, according to a press release. After starting the year strong, "escalating impacts of the coronavirus pandemic" have dragged first-quarter gross domestic product growth to 0.4% and second-quarter expansion to -6.5%, the Anderson School of Management said.
Third-quarter growth will slip to -1.9%, and fourth-quarter growth will reach 4% with "the resumption of normal activity," the economists added.
The update was the forecast's first in its 68-year-history to arrive before its scheduled quarterly release.
Full-year growth will fall to -0.4% before pandemic costs and continued fallout in the housing market drive a prolonged recovery period, according to the school. A full recovery to the economy's past trend isn't projected to arrive until 2022.
The economic contraction will be more severe in California than the rest of the nation, the economists said. The coronavirus outbreak will bite into the state's tourism and trans-Pacific transport industries, driving a steep jump in unemployment. California will lose more than 280,000 payroll jobs by the first quarter of 2021 and see its unemployment rate jump to 6.3% over the same period, the report forecasted.
UCLA's update arrives one day after Goldman Sachs revised its own GDP forecasts and called for a recession to hit by the end of the second quarter. The bank sees GDP growth slowing to a halt in the first quarter before shrinking 5% the quarter after. The slump will be followed by a strong rebound through the rest of the year, the analysts added.