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CALIFORNIA EMPLOYMENT SEES WEAKER GAINS IN FIRST MONTH OF 2019; ANNUAL REVISION SHOW MOST STATE INDUSTRIES REMAIN ON TRACK Unemployment Inches Up As Labor Force Continues Growth

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March 11, 2019—LOS ANGELES, CALIFORNIA—Today’s release from Beacon Economics and the UC Riverside School of Business Center for Economic Forecasting and Development includes analysis and commentary on both the January employment numbers and the annual benchmark revision from the California Employment Development Department (EDD).

 

January Numbers
California began 2019 with a weaker than normal monthly gain in January, increasing payrolls by 3,000 in the latest numbers from the California EDD. The yearly pace of growth slowed as well, with the state adding 246,400 jobs from January 2018 to January 2019, an increase of 1.4%. This represents a slightly slower rate of growth than in December 2018 when jobs increased by a revised 1.6% year-over-year, and is behind the national growth rate of 1.9% year-over-year as of January.
California’s unemployment rate inched up to 4.2% in January, a 0.1 percentage point increase from December. However, the driving force behind this increase was an uptick in the state’s labor force, which grew by 50,200 during the month. In yearly terms, the labor force grew by 1.5%, continuing an accelerating trend that began in mid-2018.
”California began 2019 much as it ended 2018, with the unemployment rate in record low territory and industry job gains that have been led by health care, professional and business services, and leisure and hospitality,” said  Robert Kleinhenz  Executive Director of Research at Beacon Economics and the UCR Center for Forecasting. “Looking through the rest of the year, signs point toward continued growth at the state level, with most of California’s regions remaining on track as compared to last year.”

 

Key Findings:
  • Health Care was responsible for the most job gains this month, adding 5,600 positions during  January. This sector has exhibited steady gains for some time, with a year-over-year increase of 2.4% or 56,000 positions.
  • Administrative Services followed Health Care with an increase of 2,800 jobs in January. With these gains, year-over-year growth for the sector reached 2.7%, well above the statewide average of 1.4%. Other sectors having a strong month were, Government (+2,400 positions), Professional, Scientific & Technical Services (+1,700 positions), and Information (+1,400 positions).
  • Despite steady gains for the state overall, a number of sectors shed positions in December. Declines were strongest in Retail Trade, which shed 5,500 positions. Other sectors that lost positions during the month were Education (-3,000 positions), Finance and Insurance (-1,600 positions), Wholesale Trade (-1,400 positions), along with Other Services, Construction, Logistics, and Management of Enterprises.
  • While growth was spread across the state in January, it was strongest in the San Francisco Bay Area. San Jose added the most positions both statewide and in the Bay Area in the latest numbers, increasing payrolls by 5,100. This was followed by San Francisco (MD) (+3,900), the East Bay (+1,200), Santa Rosa (+400), and Vallejo (+200). From a year-over-year perspective, growth has been the fastest in San Francisco (MD) (3.8%), followed by San Jose (2.4%), Napa (1.5%), the East Bay (1.3%), Santa Rosa (1.1%), and Vallejo (0.5%).
  • In Southern California, Orange County added the most positions in January with a gain of 4,200 jobs. San Diego followed with an increase of 100 jobs. The remaining metro areas lost jobs, with Los Angeles shedding 2,600 positions, Riverside down by 2,100 jobs, and Oxnard losing 400 positions. From a year-over-year perspective, growth was fastest in the Inland Empire (1.7%), followed by San Diego (1.5%), El Centro (1.2%), Orange County (1.0%), Ventura County (0.8%), and Los Angeles (0.7%).
  • In the Central Valley, Sacramento added the most positions in January, increasing payrolls by 900 jobs. Growth in Sacramento was followed by Merced (+700), Fresno (+600), and Bakersfield (+400). From a year-over-year perspective, growth has been the fastest in Fresno (3.2%), Sacramento (2.7%), Bakersfield (2.3%), and Madera (2.1%).
  • Along the Central Coast, Santa Barbara added the most positions in January, increasing payrolls by 800 jobs. This was followed by Santa Cruz where payrolls increased by 700 positions during the month, and Salinas (+500). From a year-over-year perspective, growth has been strongest in Salinas (2.8%) and Santa Barbara (2.8%), followed by Santa Cruz (1.1%), and San Luis Obispo (0.8%).
Annual Benchmark Revision
The annual benchmark revision from the California EDD did not change top-level growth. From 2017 to 2018, year-over-year growth averaged 2.0% before and after the revisions. However, there were more payroll positions in 2017 and 2018 than previously estimated, with average monthly employment levels 53,600 higher in the revised figures.

At the industry level, the benchmark revision was mixed, with some sectors seeing growth rates rise and others seeing their growth rates revised downward. The largest increases in year-over-year growth rates from 2017 to 2018 occurred in Mining and Logging (0.3% original to 3.9% revised), Management (0.6% original to 3.2% revised), Other Services (-0.2% original to 1.3% revised), Logistics (3.7% original to 4.9% revised), Real Estate (1.5% original to 2.4% revised), and Manufacturing (0.5% original to 1.2% revised).

The largest declines in year-over-year growth rates from 2017 to 2018 were in Leisure and Hospitality (2.7% original to 1.7% revised), Retail Trade (0.5% original to -0.1% revised), Finance and Insurance (0.1% original to -0.4% revised), Government (1.2% original to 0.9% revised), and Educational Services (3.5% original to 3.1% revised).

The EDD’s annual benchmark revision was also mixed at the metro level, with some areas seeing significant gains in their growth rates and others experiencing declines compared to earlier estimates. The largest increases in year-over-year growth rates from 2017 to 2018 were in Hanford (0.8% original to 3.0% revised), Napa (0.3% original to 2.3% revised), Sacramento (1.8% original to 3.1% revised), San Francisco (MD) (1.9% original to 3.1% revised), and Orange County (1.0% original to 1.9% revised).

The largest declines in year-over-year growth rates from 2017 to 2018 were in Merced (3.9% original to 1.4% revised), Santa Cruz (2.5% original to 0.6% revised), Visalia (2.4% original to 0.9% revised), San Jose (3.3% original to 1.9% revised), and San Rafael (MD) (1.9% original to 0.8% revised).

The Inland Empire Business Journal (IEBJ) is the official business news publication of Southern California’s Inland Empire region - covering San Bernardino & Riverside Counties.

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Career & Workplace

Worker Supply Remains Primary Obstacle to California Job Growth

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April Job Gains Revised Upwards In Latest Numbers

California’s labor market continued to expand at a steady pace in May (the latest data), with total nonfarm employment in the state growing by 42,900 positions over the month, according to an analysis released jointly by Beacon Economics and the UCR School of Business Center for Economic Forecasting and Development. April’s gains were also revised up to 44,600 in the latest numbers, a 3,200 increase from the preliminary estimate of 41,400.

While California has added jobs at a healthy pace in 2021 and 2022, as of May 2022, the state has recovered just 93% of the jobs that were lost in March and April 2020, and there are still 193,800 fewer people employed in California compared to February 2020. Total nonfarm employment in the state contracted 1.1% over this time compared to a 0.5% drop nationally. However, with a larger portion of its workforce to be recovered, California increased payrolls by 5.2% from May 2021 to May 2022, outpacing the 4.5% increase nationally over the same period.

California’s unemployment rate fell to 4.3% in May, a 0.3 percentage-point decline from the previous month, which was driven by an increase in household employment (+121,000). California’s unemployment rate remains elevated relative to the 3.6% rate in the United States overall. While growing by 75,000 in May, the state continues to struggle with its labor supply. Since February 2020, the California labor force has fallen by 232,100 workers, a 1.2% decline.

“The low unemployment rate in the state shows that worker supply remains the primary obstacle to job growth in California,” said Taner Osman, Research Manager at Beacon Economics and the Center for Economic Forecasting. “Moreover, a clear dichotomy has emerged, whereby labor markets in the state’s central communities have outperformed the coastal communities; the coast is routed in high cost and housing supply constraints and continues to experience labor market shortages.”

Industry Profile  

  • While a handful of sectors in California are now exceeding their pre-pandemic peaks, employment levels in the hardest hit sectors remain below their pre-pandemic levels and should continue to steadily gain back jobs over the coming months.
  • Leisure and Hospitality led payrolls gains in May, with payrolls expanding by 8,800. However, this industry still has a long way to go to recover all of the jobs lost due to the pandemic, with payrolls still down 8.4% since February 2020.
  • Other sectors posting strong gains during the month were Information (8,800), Construction (7,100), Health Care (6,600), Government (4,600), Manufacturing (3,700), Other Services (3,600), and Transportation, Warehousing, and Utilities (3,600).
  • Job gains were broad based in May with Retail Trade (-9,900) being the only sector to post significant losses during the month. Finance and Insurance (-500) and Mining and Logging (-300) also shed positions during the month, but the losses were minor.

Regional Profile

  • Regionally, job gains were led by Southern California. San Diego saw the largest increase, where payrolls grew by 6,700 (0.4%) during the month. Orange County (6,500 or 0.4%), Los Angeles (MD) (5,200 or 0.1%), the Inland Empire (2,600 or 0.2%), and Ventura (2,100 or 0.7%) also saw their payrolls jump during the month. The Inland Empire (123.4%) has experienced the strongest recovery in the region, measured by the percentage of jobs recovered from April 2020 to May 2022 relative to the jobs lost from February 2020 to April 2020. The IE is followed by El Centro (110.2%), San Diego (97.1%), Orange County (86.5%), Los Angeles (MD) (83.9%), and Ventura (79.8%).
  • In the Bay Area, San Francisco (MD) experienced the largest increase, with payrolls expanding by 2,700 (0.2%) positions in May. The East Bay (1,900 or 0.2%), San Jose (1,700 or 0.1%), and San Rafael (MD) (600 or 0.6%) also saw payrolls expand during the month. Since April 2020, San Jose (86.2%) has experienced the strongest recovery in the region, followed by the East Bay (83.8%), San Francisco (MD) (78.4%), Santa Rosa (76.5%), Napa (75.6%), Vallejo (67.4%), and San Rafael (MD) (62.6%).
  • In the Central Valley, Sacramento experienced the largest monthly increase as payrolls expanded by 3,200 (0.3%) positions in May. Payrolls in Visalia (500 or 0.4%), Fresno (400 or 0.1%), Merced (300 or 0.4%), and Yuba (200 or 0.4%) increased steadily as well. Since April 2020, Visalia (127.9%) has experienced the strongest recovery in the region, followed by Stockton (124%), Yuba (124%), Madera (112%), Merced (111.9%), Sacramento (110.8%), Redding (105.1%), and Fresno (104.5%).
  • On California’s Central Coast, San Luis Obispo added the largest number of jobs, with payrolls increasing by 1,100 (0.9%) during the month. Salinas (900 or 0.6%) and Santa Barbara (700 or 0.4%) also saw payrolls expand. Since April 2020, and San Luis Obispo (92.7%) has experienced the strongest recovery in the region, followed by Santa Barbara (89%), Salinas (82.2%), and Santa Cruz (80.5%).
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Career & Workplace

California Workforce Expands in Latest Numbers but Labor Supply will Continue Constraining Job Growth

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March Job Gains Revised Upwards In Latest Numbers

California’s labor market continued to expand at a steady pace in April, with total nonfarm employment in the state growing by 41,400 positions over the month, according to an analysis released jointly by Beacon Economics and the UCR School of Business Center for Economic Forecasting and Development. March’s gains were also revised up to 74,400 in the latest numbers, a 14,200 increase from the preliminary estimate of 60,200.

While California added jobs at a healthy pace throughout 2021 and has done the same so far in 2022, as of April, the state has recovered just 91.3% of the jobs that were lost in March and April of 2020, the onset of the pandemic. There are now 239,900 fewer people employed in California compared to February 2020. Total nonfarm employment in the state has contracted 1.4% since that time compared to a 0.8% drop nationally. With a larger portion of its workforce still to be recovered, California increased payrolls by 5.6% from April 2021 to April 2022, well above the 4.6% increase nationally over the same period.

California’s unemployment rate fell to 4.6% in April, a 0.2 percentage-point decline from the previous month. The decline was driven by an increase in household employment (+150,000). Still, the state’s unemployment rate remains elevated relative to the 3.6% rate in the nation overall. While growing by 111,800 in April, California is continuing to struggle with its labor supply. Since February 2020, the state’s labor force has decreased by 299,600 workers, a 1.5% decline.

“Labor supply remains the biggest constraint to job growth in the state,” said Taner Osman, Research Manager at Beacon Economics and the Center for Economic Forecasting. “And as employers seek to ramp up employment during the seasonally strong summer months, worker scarcity will continue to place upward pressure on wages in the state.”

Industry Profile  

  • At the industry level, the largest jobs gains continue to occur in the sectors hardest hit by the pandemic. While a handful of sectors in California are now exceeding their pre-pandemic peaks, employment levels in the hardest hit sectors remain below their pre-pandemic levels and should continue to steadily gain back jobs over the coming months.
  • Leisure and Hospitality led payrolls gains in April, expanding by 20,100. Payrolls in Leisure and Hospitality still have a long way to go to recover all of the jobs lost due to the pandemic however, with payrolls still down 8.7% compared to February 2020.
  • Other sectors posting strong gains during the month were Professional, Scientific, and Technical Services (7,300), Government (4,600), Retail Trade (4,500), Transportation, Warehousing, and Utilities (4,200), Administrative Support (3,100), Manufacturing (2,600), and Information (1,800).
  • While job gains were broad-based in April, the Construction (-13,200) sector posted significant losses during the month. Health Care (-500), Other Services (-100), and Mining and Logging (-100) also shed positions, but the losses were minor.

Regional Profile

  • Regionally, job gains were led by Southern California. Los Angeles (MD) saw the largest increase, where payrolls grew by 9,600 (0.2%) during the month. The Inland Empire (8,000 or 0.5%), San Diego (4,500 or 0.3%), and Orange County (4,300 or 0.3%) also saw their payrolls jump during the month. The Inland Empire (122.6%) has experienced the strongest recovery in the region, measured by the percentage of jobs recovered from April 2020 to April 2022 relative to the jobs lost from February 2020 to April 2020. The IE is followed by El Centro (108.5%), San Diego (94.4%), Orange County (83.9%), Los Angeles (MD) (83.5%), and Ventura (75.0%).
  • In the Bay Area, San Francisco (MD) experienced the largest increase, with payrolls expanding by 4,900 (0.4%) positions in April. San Jose (4,300 or 0.4%), the East Bay (2,100 or 0.2%), Santa Rosa (500 or 0.2%), and Vallejo (300 or 0.2%) also saw payrolls expand during the month. Since April 2020, San Jose (85.8%) has experienced the strongest recovery in the region, followed by the East Bay (82.3%), Santa Rosa (77.3%), San Francisco (MD) (77.1%), Napa (76.7%), Vallejo (68.3%), and San Rafael (MD) (58.7%).
  • In the Central Valley, Sacramento experienced the largest monthly increase as payrolls expanded by 4,700 (0.4%) positions in April. Payrolls in Bakersfield (1,400 or 0.5%), Fresno (1,000 or 0.3%), Visalia (600 or 0.4%), Modesto (400 or 0.2%), Chico (300 or 0.4%), and Redding (200 or 0.3%) increased steadily as well. Since April 2020, Visalia (126.4%) has experienced the strongest recovery in the region, followed by Stockton (124.3%), Yuba (122%), Madera (116%), Sacramento (109.6%), Redding (108.9%), Merced (105.1%), and Fresno (104.0%).
  • On California’s Central Coast, Santa Barbara added the largest number of jobs, with payrolls increasing by 100 (0.1%) during the month. San Luis Obispo (-1,400 or 1.2%), Santa Cruz (300 or 0.3%), and Salinas (300 or 0.2%) saw payrolls decline. Since April 2020, San Luis Obispo (89.3%) has experienced the strongest recovery in the region, followed by Santa Barbara (86.9%), Santa Cruz (81.9%), and Salinas (78.7%).
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Career & Workplace

City of San Bernardino Names Nathan Freeman as Director of Community and Economic Development

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The City of San Bernardino Announces Nathan Freeman as its new Director of Community and Economic Development. His starting date is May 16.

An experienced professional with almost 25 years working in economic development in the Inland Empire, Freeman comes to San Bernardino after spending the past sixteen years with the City of Riverside, where he served as the Economic Development, Redevelopment, and Real Property Services Manager.

“Nathan Freeman has extensive experience successfully negotiating major development agreements while at the same time creating opportunities for small businesses and startups,” said City Manager Robert Field. “He has played a critical role in the recent and upcoming development in downtown Riverside and is a great addition to the San Bernardino team.”

In the role of Director of Community and Economic Development, Freeman will oversee the functions, programs, and activities of the Planning Division, Building Division, Code Enforcement, Economic Development, and Housing.

“I am looking forward to the opportunity to work alongside an amazing team in San Bernardino, under the leadership of the City Council and City Manager, who are dedicated to building a stronger and more economically resilient community,” said Freeman. “I’m truly excited about the City’s long-term potential and am grateful for the opportunity to lead the Community & Economic Development Department as we encourage job creation, business development, and a better quality of life for all residents.”

In Riverside, Freeman played a key role in major development projects, including the revitalization of downtown. He negotiated approximately $1 billion in private investment throughout Riverside, including the development of over 250,000 square feet of Class A office/commercial space, worked to attract many new businesses to the city, and facilitated the development of the Riverside Food Lab, the Inland Empire’s first urban food court.

Previously, Freeman served as Business Development Officer for the City of Hesperia and Economic Development Project Manager for the County of Riverside.

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