Reporting

March 11, 2014 by Ed Coghlan

Jobs growing in California regions left behind by recovery

The State of California’s employment outlook is brightening, in wake of some revised data from the State Employment Development Department.

In 2013, it turns out that California’s job creation was far greater than the national average. 391,000 new jobs were created in the Golden State, which represented a 2.6 percent increase compared to a national increase of 1.7 percent.

Some of the largest upward revisions were in construction (+24,300), professional and business services (+46,000) and government (+24,900) and information services (+21,100).

As expected, The Bay Area growth in job continues to be very strong. The region added almost 117,000 jobs led by gains in the San Jose and San Francisco tech centers.

But the good news didn’t stop there, as Steve Levy of the Center for the Continuing Study of the California Economy pointed out.

“The other upward revision story was that growth spread to areas of the state previously left behind,” said Steve Levy, CCSCE’s Director. 

 As an example, these four large Southern California counties all reported additional job growth:

  • Los Angeles +91,100 jobs +2.3 percent
  • Orange County +38,700 or 2.7 percent
  • Riverside-San Bernardino +37,400 or 3.1 percent

The Southern California economy stormed back in 2013 and the hard-hit Inland Empire posted the largest regional job growth. In the San Joaquin Valley there was a resurgence of growth led by the large metro areas:

  • Fresno +12,200 jobs or 4.1 percent
  • Bakersfield +6,400 or 2.6 percent
  • Modesto +4,700 or 3.1 percent
  • Stockton +6,600 or 3.4 percent

These upward revisions explain why unemployment rates are falling throughout the state, although outside of the Bay Area they remain above the national average in most counties. The state seasonally adjusted rate declined again to 8.1 percent in January.

The outlook is for continued, above-average job growth as the leading sectors—tech, tourism/entertainment and trade—keep trending well. There is now spillover growth in construction and government (job losses in those sector were the leading causes of the deep California recession, according to Levy) as well as gains in retail trade, health care and other services.

The strong growth in 2013 should put to rest continued debate about whether job growth and competitiveness in California is below average and also confirm the positive effect of recent budget policies including the temporary tax increase adopted in November 2012 after which the state added more than 400,000 jobs.

Not all the news is rosy. Carmaker Tesla has already ruled out California as a location for a $5 billion battery development and manufacturing plant that will employ 6,500 workers. Tesla apparently has narrowed its search to sites in Arizona, Nevada, New Mexico and Texas.

And the mega drought that we are suffering through promises to have significant negative impact on agriculture employment in the state, as dry conditions and the lack of water availability threaten to impact jobs on California farms and ranches.

In the face of California's challenges, it's encouraging to see, in the wake of last November's California Economic Summit, hundreds of Californians are working on ways to improve the job creation climate in the state. That work includes how to increase investments in workforce development, infrastructure, and drought-relief efforts that promote long-term water sustainability. You can check on their progress here at the Summit's Progress Tracker page.

Wondering how to improve California’s economy? Here’s an interesting piece that ran recently.

Categories: Jobs

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