The latest UCLA Anderson Forecast has found that California's economy is growing faster than the nation, with its fourth-quarter growth estimated at 3.8% annualized, surpassing the initial 1.4% U.S. GDP estimate. However, payroll employment will decline in 2025, marking the first sustained contraction since the pandemic. The forecast identified a "new bifurcated economy" driven by AI, aerospace, and other high-productivity sectors, while slower-growing sectors such as construction, retail, and leisure and hospitality. Despite this, there are encouraging signs of increased hiring in aerospace and computer sectors.