LOS ANGELES -- California's recession will continue through mid-1993 and may last until 1994, according to a business forecasting report released yesterday by the University of California at Los Angeles.

"The outlook assumes a weak recovery beginning in the fall of 1993, but given the fact that the conditions necessary for recovery are still not on the horizon, we caution that the recession could very well last into 1994," David Hensley, director of the forecast, said in a statement.

The forecast repeated a previous prediction that California's jobless rate will reach 11% next year, and it warned that the unemployment figure could remain there until 1995. The state's unemployment rate reached 10.1% last month.

According to the university's report, California's problems include the reduction of its defense industry, the state's expected budget shortfall through fiscal 1994, a glut of commercial buildings, overpriced real estate, and a variety of concerns tied to regulatory and tax burdens, crime, earthquakes, schools, traffic, and smog.

The report follows on the heels of other pessimistic projections by a state commission and a legislative analyst.

"The trauma of the past several years is prompting a fundamental reassessment," Hensley said. "Expectations about California's long-term growth are being universally revised downward."

The UCLA forecast predicted the nation's economy will grow by 2.8% next year, helped by increased consumer spending and a moderate fiscal stimulus from the Clinton administration.

"A stronger national or international economy is necessary, but not sufficient, for a near-term rebound in California," Hensley said. "The state is somewhat disengaged from the rest of the U.S. right now [and] working its way through special problems which will not necessarily be turned around by a more vigorous economic expansion."

Two other key factors for a recovery in California -- an upturn in housing starts and stabilization of its consumer sector -- have not occurred, the UCLA report says.

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