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California’s Economic Outlook and Recovery Roadmap

Today, California Governor Gavin Newsom announced the “Resilience Roadmap,” a detailed set of guidelines for modifying the state’s stay-at-home orders and beginning to reopen businesses in a safe manner. 

Resilience Roadmap

California will begin moving into Stage 2 today, May 8, with lower-risk workplaces opening gradually with adaptations to keep workers and customers as safe as possible. However, the path to reopen will not be the same statewide, with some counties moving into Stage 2 later than others and putting stricter guidelines into place. For example, San Francisco will not begin reopening until May 18. 

Meanwhile, California finance officials issued findings from their first economic assessment of the pandemic’s impact on the state. Highlights (or more appropriate lowlights) include:

  • California faces a $54 billion deficit – 3.5 times larger than the $16 billion rainy day fund and almost 37% of the state’s general fund.
  • The unemployment rate could reach 18% for the year, higher than during the Great Recession.
  • Expect cuts to the social safety net, including schools, healthcare, and other anti-poverty programs. Local and state officials are urging the federal government for additional stimulus to address these shortfalls.