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California Job Growth Continues… at Modest Pace

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CALIFORNIA JOB GROWTH CONTINUES… AT MODEST PACE 

Unemployment Rate Falls To New Historic Low

 

October 19, 2018—LOS ANGELES, CALIFORNIA—Nonfarm job growth in California was modest in September, with the state adding 13,200 positions in the latest numbers from the Economic Development Department (EDD), according to an analysis released jointly by Beacon Economics and the UC Riverside School of Business Center for Economic Forecasting and Development. From September 2017 to September 2018, California’s job growth rate (2.0%) outshined the nation’s (1.7%), while its yearly increase of 339,600 jobs was third largest among the 50 states.

California’s unemployment rate declined to 4.1% in the latest numbers, a new historic low, despite a 34,300 increase in the state’s labor force over the month. However, labor force growth remains modest from a year-over-year perspective, growing by just 4,900 from September 2017 to September 2018.

“September’s monthly gain was below this year’s average of 22,000, but monthly employment changes are quite volatile,” said  Robert Kleinhenz  Executive Director of Research at Beacon Economics and the UCR Center for Forecasting. “More significantly, the state has maintained a yearly job growth rate of about 2% for several months running, despite a record low unemployment rate that edged down further this month and a labor force that is barely growing.” Kleinhenz noted, However, that labor force constraints will begin to slow job growth across California in 2019.

Key Findings:

  • At the industry level, growth was somewhat mixed in September. While the majority of sectors saw continued increases in payrolls, a handful shed positions. The Administrative Support sector was responsible for the most jobs added during the month (+8,800), with year-over-year growth coming in at 3.1%. The Leisure and Hospitality sector also had a strong month, adding 8,500 positions. Other sectors that grew during the month include Government (+5,100 positions), Professional, Scientific, and Technical Services (+3,800 positions), and Real Estate (+1,500 positions).
  • The Leisure and Hospitality sector led the way in terms of year-over-year gains with 68,600 jobs added, increasing payrolls by 3.5% from September 2017 to September 2018. Health Care continued its solid performance, adding 64,500 jobs, followed by Government at 42,800 jobs, and Professional, Scientific and Technical Services with 40,300 positions added.
  • The sector posting the largest decline this month was Information, which shed 3,000 positions. However, payrolls in this industry have grown by 1.1% from a year-over-year perspective. Other sectors posting sizeable declines in September were Educational Services (-2,400 positions), Construction (-2,000 positions), and Other Services (-1,800 positions).
  • Regionally, growth was mixed. In Southern California, payrolls expanded in San Diego (+3,100) and the Inland Empire (+1,900), while payrolls declined in Orange County (-2,600) and Los Angeles (MD) (-400). From a year-over-year perspective, the Inland Empire grew the most (3.3%), followed by San Diego County (2.0%), Los Angeles (MD) (1.2%), Ventura County (+0.9%), and Orange County (0.5%).
  • In the San Francisco Bay Area, the East Bay (+2,400) and San Francisco (MD) (+1,000) added the largest number of jobs in September. From a year-over-year perspective, San Jose (+3.7%) grew the most, followed by San Rafael (+3.6%), Santa Rosa (+2.7%), San Francisco (MD) (+1.9%), and the East Bay (+1.9%).
  • In the Central Valley, growth was led by Stockton (+1,100), Fresno (+600) and Chico (+500) and declines were led by Sacramento (-4,100) and Bakersfield (-1,700). From a year-over-year perspective, Merced (+4.2%) grew the most, followed by Chico (+3.5%), Stockton (+3.3%), and Fresno (+3.2%).
  • On the Central Coast, job growth was led by Santa Barbara and Salinas, which each added 700 jobs, with Santa Cruz (+300) and San Luis Obispo (+200) also adding positions in September. From a year-over-year perspective, Salinas (+3.7%) grew the most, followed by Santa Cruz (+2.8%), San Luis Obispo (+1.3%), and Santa Barbara (+0.8%).

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Beacon Economics is an independent economic research and consulting firm based in Los Angeles. The UCR School of Business Center for Economic Forecasting and Development is the first world class university forecasting center in the Inland Empire. This analysis was authored by Christopher ThornbergRobert Kleinhenz, and Brian Vanderplas. Learn more at www.beaconecon.com and www.ucreconomicforecast.org.

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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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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