Economists at UOP's Business Forecasting Center originally thought California's jobless rate would start declining from double-digit levels by the end of next year.
"Now we see that stretching out to the end of 2013. And 2011 and 2012 are looking significantly slower."
Jeff Michael heads the center. He says the numbers don't suggest a double-dip recession, but they do appear to forecast growth of less than 3% in both personal income and gross state product.
But Michael says there are some bright spots.
"Some of the southern California areas and the coastal areas have got some better recovery prospects."
He says Orange County and San Jose specifically are leading California's recovery because both are high-tech manufacturing centers.
Meanwhile, he says the Sacramento area will continue to lag because of the ongoing housing crisis and cuts to state government jobs.