The yin and the yang of our California employment picture | FlashReport

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Richard Rider

The yin and the yang of our California employment picture

California’s employment figures have definitely improved from the depths of our disastrous recession.  Our Left Coast state suffered worse from the downturn than the rest of the country, and have until recently lagged in the recovery. Democrats like to paint California today as experiencing a “miracle” rebound, with CA leading the nation in the employment surge.
They are in some ways right. And dead wrong.

Let’s drill down a bit into the numbers to get a more complete picture.  The devil is in the details, as they say.  After lagging for years, we had a surge in CA jobs in 2015.  But that surge seems to be petering out, as the numbers below indicate.

First, let’s be clear.  We have NOT fully recovered from the recession.  Nor are we doing better than the country’s average unemployment figures. But we have had a recent surge to narrow the gap. Here’s my latest figures from the BLS:


The CA unemployment rate (Dec, 2016) has been improving. We are tied for tenth worst – 5.2%. National unemployment rate is 4.7%.  Nat’l unemployment rate not including CA is 4.6%, making the CA unemployment rate 12.3% higher than the average of the other 49 states.
http://www.bls.gov/web/laus/laumstrk.htm NOTE: We were at 4.8% unemployed in Nov, 2006 – vs. national 4.6%.
But using the lagging yet arguably more accurate U-6 measure of unemployment (includes involuntary part-time workers), CA is the 4th worst – 11.3% vs. national 9.6%. National U-6 not including CA is 9.4%, making CA’s U-6 20.6% higher than the average of the other 49 states.

 

What’s interesting is that the California unemployment rate continues to drop while the increase of net new jobs in anemic at best in the Golden State.  CA is a state of over 39 million people.  But we added only 4,400 non-farm net new jobs in December (including part-time jobs).  In January we created only 9,700 such jobs.  These are pathetically low figures for the “6th largest economy in the world.”

Most of the improvement in our unemployment rate is from people retiring, leaving the state, declaring themselves disabled, or workers who have simply given up looking for a job.  This pattern has been going on for some time nationwide, but seems to be more pronounced in California.

As has been widely noted, California’s job picture is anything but uniform.  Certain areas have high paying tech-oriented jobs with an ongoing demand for skilled labor.  Silicon Valley and San Francisco are the epicenters of this boom.

San Diego, a more diverse economy, is doing well with 4.2% unemployment.  Unfortunately too many of these jobs are low paying and/or part-time.
https://www.bls.gov/eag/eag.ca_sandiego_msa.htm

But much of the rest of the state is not doing well.  We have 13 more rural counties which still suffer from double digit unemployment.

In addition, a number of more urban areas also are doing poorly compared to the rest of the nation. Look at the nation’s “Metropolitan Statistical Areas” (MSA’s).  Such areas are suburban/urban areas with some economic ties — more regional than limited by city limit boundaries.   The definition of an MSA can be found here:
https://en.wikipedia.org/wiki/Metropolitan_statistical_area

There are 382 MSA’s in America.  Looking at the December, 2016 employment figures, of the 10 worst MSA’s in America, SEVEN are in California.  Of the 20 worst, 12 are in our state.  These abysmal rankings put the lie to the “California miracle.”

NOTE:  The info below is a monthly report from the CA Business Roundtable, which you can sign up for.  The figures in the report depend on CA STATE figures from the state’s EDD, so they are a bit different than my BLS figures above. The EDD figures are not comparable to the figures from the other states, so I stick with the BLS source. 

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Center for Jobs Twitter
California Employment Report for January 2017
The Center for Jobs and the Economy has released our initial analysis of the January Employment Report released by the California Employment Development Department. The February jobs numbers will be released by EDD later this month. For additional information and data about the California economy visit www.centerforjobs.org.
Unemployment Rate Improves as Labor Force Dips
5.1%
State Unemployment
Rate
EDD reports California’s unemployment rate (seasonally adjusted) in January 2017 continued improving to 5.1% but with a slight drop in the labor force. Total employment was up 11,000 from the revised numbers for December, while total unemployment dropped 13,000. The US unemployment rate notched up from 4.7% to 4.8% as the national labor force expanded slightly.
Nonfarm Jobs Up
9.7k
Job Gains
Nonfarm wage and salary jobs grew by 9,700 in January. December’s gains were largely unchanged at 4,400 from the previously reported gain of 3,700.
Counties with Double-Digit Unemployment
13
Counties with
Unemployment
Above 10%
The number of counties with unemployment rates at 10% or higher rose to 13 (Colusa, Imperial, Plumas, Merced, Tulare, Kings, Monterey, Kern, Sutter, Siskiyou, Fresno, Modoc, and Madera). The number with unemployment rates at or below 5% dropped to 16, with 5 counties below 4%.
MSAs Continue to Have Worst Unemployment in US
7
MSAs in Lowest
National Unemployment
Rates
Seven California metropolitan statistical areas (MSAs) were in the worst 10 unemployment rates nationally in December 2016. The number of California MSAs in the worst 20 increased to 12.

The California Center for Jobs and the Economy provides an objective and definitive source of information pertaining to job creation and economic trends in California.

www.centerforjobs.org

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