LOS ANGELES-UCLA Anderson School of Management's quarterly report on the national economy doesn't hold back: “It's not a recovery. It's not even normal growth. It's bad.”

The June Anderson Forecast report, its second of this year, says that despite improvement in GDP and key economic sectors, the overall US economic growth falls short of the rates required for the national economy to truly recover from the most recent recession.

It does paint a somewhat brighter picture for California and the national residential and multifamily housing markets.

Ed Leamer, the director of the Anderson Forecast, was the author of the report's harshest assessments. “US real GDP is now 15.4% below the normal 3% trend,” Leamer says in an essay, “Great Recovery: Wherefore Are Thou.”

To get back to that 3% trend, Leamer says, “we would need 4% growth for 15 years, or 5% growth for eight years, or 6% growth for five years, not the disappointing 2s and 3s we have been racking up recently, which are moving us farther from trend, not closer to it. It's not a recovery. It's not even normal growth. It's bad.”

Leamer says that growth in national GDP is positive, but not exceptional. Jobs numbers are improving, but not rapidly enough, and the jobs being created are not necessarily jobs that will ensure workers a secure future. Leamer says that the tepid growth obscures such “fundamental problems” as government spending funded with too much borrowing, little national savings to cover late-in-life health care issues, and too many workers lacking skills to compete in a modern economy.

The good news is that the gloomy outlook is slightly better than those of the recent past, and 2015 is expected to be better than 2014. The Anderson Forecast says that real GDP edges up to 3% by 2015 and the Federal Reserve Bank interest rate will remain near zero, while unemployment will fall to 6.6% by 2015, albeit due in part to what's termed “a growing base of discouraged workers.”

Leamer does see “the early stages of a real recovery in housing. Housing starts, which fell to a historic low of 550,000 in 2009, will climb back to the normal 1.5 million by 2015.”

David Shulman, a senior economist with ULCA Anderson Forecast and UCLA Ziman Center for Real Estate, adds that “home prices are rising and housing starts have approximately doubled from their depression lows of a few years ago.” Shulman says that housing starts will reach a rate of 1.6 million units by mid-2015 and home prices will continue to rise. Housing starts are expected to increase from 782,000 units in 2012 to 1.03 million in 2014 to 1.35 million in 2014, reaching 1.56 million by 2015.

Multifamily housing starts will continue to rise, with an excess of 400,000 units a year being started in both 2014 and 2015.

In California, the state continues to lead the jobs growth seen in the national economy. The difference lies in the construction sector. “As job gains accumulate, household formation rates increase and the demand for housing, finally, is generating new residential construction,” says Anderson senior economist Jerry Nickelsburg.

Nickelsburg says California employment growth has been consistently in the top ten states, with only Utah's employment growing faster. The economy's strength is from the state's technology and knowledge-laden sectors, accounting for more then half the job growth in California.

UCLA Anderson Forecast economist William Yu notes that “L.A. has a relatively low supply of homes, considering its population and economic growth, compared to most cities.” His research suggests that a reduction in unnecessary regulation barriers with a more widespread public transportation system would result in a great supply of homes, especially multi-family homes.

As reported earlier by GlobeSt.com, UCLA Anderson had a more positive outlook for Orange County's economy in a report released two months ago.