Worker Supply Remains Biggest Constraint to CA Job Growth

California May job gains revised down in latest numbers
By Victoria Pike Bond |
19,900 Jobs Added

Total nonfarm employment in California expanded modestly in the latest numbers, growing by 19,900 positions in June, according to an analysis by the UCR School of Business Center for Economic Forecasting & Development, released jointly with Beacon Economics. May’s employment estimates were also revised down to 40,800, a 2,100 decrease from the preliminary estimate of 42,900.

“After an impressive start to the year, in which the state added jobs at a rate 20% higher than the rest of the nation, we shouldn’t over-interpret a slowdown in one month,” said Taner Osman, Research Manager at the Center for Economic Forecasting and Beacon Economics. “Still, California’s tight labor market has not eased up and will continue to act as a constraint on job growth.”

93.6% Total Jobs Recovered

While the state added jobs at a healthy pace in 2021 and 2022, as of June 2022, California has recovered just 93.6% of the jobs that were lost in March and April 2020, the onset of the pandemic. There are still 193,800 fewer people employed in California compared to pre-pandemic February 2020. Total nonfarm employment in the state is 1% below pre-pandemic levels compared to a 0.3% drop nationally. With a larger portion of its workforce to be recovered, California increased payrolls by 5.1% from June 2021 to June 2022, outpacing the 4.3% increase nationally over the same period.

4.2% Unemployment Rate

The state’s unemployment rate also fell to 4.2% in June, a 0.1 percentage-point decline from the previous month. This was driven by an increase in household employment (+75,000). Still, California’s unemployment rate remains elevated relative to the United States overall (3.6%). While the state’s labor force expanded by 65,200 workers in June, California’s labor supply still falls short of pre-pandemic levels. Since February 2020, the state’s labor force has fallen by 172,400 workers, a 0.9% decline.


Seasonally adjusted Employment numbers in CA by industry graph






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View Seasonally Adjusted Industry Employment Data For California's 28 MSAS and MDS



The Beacon Employment Report | California is a unique analysis of California’s employment numbers and trends. Each month, they link econometric predictions to data released by the U.S. Bureau of Labor Statistics and the California Employment Development Department to identify important changes in employment across industries and regions. The Beacon Employment Report is also one of the few analyses that uses seasonally adjusted numbers, which are critical to revealing accurate trends and insights within data.