This chart, from the just-released UCLA Anderson Forecast, tells a very clear story about both why California's economy is so bad and what it needs to do to make it better (Sorry I can't make the actual chart a bit more clear!). We're creating jobs in health care, tourism, and scientific and technical services. We're losing jobs in construction, retail, and government. Everything else is pretty much flat.
Here's what that means. California needs to play to its strengths and be strategic about its future. We have a good shot at being the global leader in keeping people heathy longer and in caring for not just our own aging population, but the aging populations of other countries, especially China.
People still like beaches, sunshine, and Disneyland. Probably the Golden Gate and wine country, too.
Science and technology are the fields with a future. We all know this, down deep — it's the trend of human society for centuries. But somehow we convince ourselves that other things matter as much. They don't. Hey, look, I admire the work that skilled financial professionals and tradesmen do. But I don't think they're going to tame global warming or get us to Mars, much less cure cancer or keep us chipper into our nineties.
Luckily, California has arguably the world's greatest clustering of scientific and technical institutions, from Stanford to Cal Tech (Sorry, Boston). The state now has to figure out how to properly support investment in the work being done at them.
You can look at a chart like this and draw a pretty good roadmap for the future. Or you can ignore it and wait for the next construction/consumption bubble to build. Not that hard a choice.
Source: UCLA Anderson Forecast