Overview
- UCLA Anderson now projects U.S. GDP to approach 3% in 2026 after 2.2% growth in 2025, citing income-tax cuts, broader fiscal expansion and sustained AI infrastructure buildout.
- AI capital spending is forecast at roughly $660 billion this year—about 2% of GDP—with energy and grid constraints likely to moderate the expansion over time.
- The report says national risks have shifted toward potential overheating as inflation trends toward the low-to-mid 2% range and the jobless rate eased to 4.3% in January.
- California’s Q4 growth is estimated at 3.8% annualized versus the initial 1.4% U.S. reading, marking a fourth consecutive quarter of state outperformance.
- Despite strong output, California payrolls contracted in 2025 and unemployment was 5.5% in December; UCLA notes early hiring in aerospace and computer design and a rebound in ports and air cargo, while housing activity remains constrained.