Unemployment Rate Remains Near Historic Low
-July 19,2019-
Nonfarm employment in California expanded at a solid pace, increasing by 46,200 jobs in the latest numbers from the California Employment Development Department, according an analysis released jointly by Beacon Economics and the UCR School of Business Center for Economic Forecasting and Development. This marks the second largest month-to-month increase for the overall state in the last twelve months.
From a year-over-year perspective, California added 296,100 jobs as of June 2019. This is equivalent to a 1.7% year-over-year increase, outpacing the 1.5% growth rate in the nation as a whole.
California’s labor force declined by 57,700 in June, marking the fourth consecutive month of declines. Overall, the state’s labor force has expanded by a sluggish 0.3% year-over-year, however, it has declined by 86,100 since the start of 2019. At 4.2%, the state’s unemployment rate has remained unchanged over the last year, hovering just above its historic low of 4.1%.
“California led all states in job gains last month, and it has maintained a steady course through the first half of the year despite uncertainties at the national and international level. This bodes well for the rest of the year,” said Robert Kleinhenz, Economist and Executive Director of Research at Beacon Economics and the UC Riverside Center for Forecasting. “While we are concerned about the lack of growth in the labor force, it is important to note that the faster growing regions of the state continue to attract workers.”
Key Findings:
Construction led the way in monthly job gains for a second straight month in June, boosting payrolls by 11,900 positions. These consecutive months of strong gains have helped push year-over-year growth in the sector to a robust 4.7%, outpacing the 1.7% average in the state overall. Health Care also had a strong month, increasing payrolls by 7,200 positions. Year-over-year gains for the Health Care sector now stand at a robust 2.9%.
Other sectors posting strong gains in June were Leisure and Hospitality (+4,700), Information (+4,200), Government (+4,100), Administrative Support (+3,800), and Professional, Scientific and Technical Services (+3,300). In percentage terms, Construction (4.7%) led the pack from June 2018 to June 2019, followed by Information (+3.2%), Professional, Scientific and Technical Services (+3.2%), and Health Care (2.9%).
Despite the overall growth in the state, a handful of sectors shed positions in June. Retail Trade experienced the largest decline, decreasing payrolls by 1,400. The only other sectors posting declines last month were Real Estate (-200) and Mining and Logging (-200). In percentage terms, Finance and Insurance declined 0.8% from June 2018 to June 2019, marking the largest decrease, followed by Retail Trade (-0.7% or -11,100 jobs) and Wholesale Trade (-0.2%).
Regionally, job growth was led by Southern California. Los Angeles (MD) captured the top spot, boosting payrolls by 7,300 positions from May to June. That was followed by the Inland Empire (+6,200), San Diego (+3,500), and Orange County (+3,000). From a year-over-year perspective, San Diego (+1.9%) has experienced the fastest rate of growth, followed by the Inland Empire (+1.8%), Los Angeles (MD) (+1.2%), and Orange County (1.2%).
In the San Francisco Bay Area, Bay Area, San Jose led the pack increasing payrolls by 3,800 jobs over the month. That was followed by San Francisco (MD) (+3,500) and the East Bay (+3,200). From a year-over-year perspective, San Francisco (MD) (+3.7%) grew the fastest, followed by San Rafael (MD) (+2.8%), San Jose (+2.7%), and the East Bay (1.7%).
In the Central Valley, Bakersfield topped the list, increasing payrolls by 2,300 positions from May to June. That was followed by Visalia (+500), Fresno (+300), and Madera (+300). From a year-over-year perspective, Fresno (+3.5%) was the fastest growing, followed by Bakersfield (+3.0%), Hanford (+2.2%), and Visalia (+2.1%).
On the Central Coast, Santa Barbara led the way, boosting payrolls by 700 jobs in June compared to May. That was followed by Salinas (+400), Santa Cruz (+200), and San Luis Obispo (+200). From a year-over-year perspective, Salinas (+3.2%) added jobs at the fastest rate, followed by Santa Barbara (+2.5%), Santa Cruz (+2.3%), and San Luis Obispo (+1.4%).