People in United States may afford to buy enough meals and new clothes this year. However, the Anderson School of Management in UCLA said that many Americans may not have enough money to spend on big expenses such as new house or new car. From the same report, it was also mentioned that the recovery from the financial crunch will also be slower compared to the last recessions that the country experienced before.
There are so many factors that affect this slow recovery. For one, there are not much new homes that were purchased the past few years. Of course, it also took toll on other industries as well such as financial services and construction. Workers spend more time being jobless as the consumers start to think twice on how they would spend their money.
But out of all states, the recovery will be at its slowest in the state of California. Prior to the recession, there were thousands of houses built. It now remains vacant up to date and even to the next following years, which will hinder the growth of the said state.
From the same study, the growth of the gross domestic product starting 2010 until 2012 will only increase by as much as 2.9 percent annually. This is almost two times smaller compared to the annual growth that happened during the last recessions in the country. According to the UCLA Anderson Forecast director, Edward Leamer, United States needs to grow by as much as 5 percent so that the Americans can get back to work at the same time.
This definitely is not good especially for those who lost their homes during the economic crunch. Last April, there were homes that were sold for only $173,100 when in fact they can sell it by 14 percent more if they sold the property last April 2008. This was according to the report of the National Association of Realtors.