Defenders of California High-Speed Rail often respond to critics by touting how the project provides high-paying jobs in the construction industry for disadvantaged residents of the San Joaquin Valley. It’s one thing to proclaim intentions, but another to achieve them. . . .But these programs and jobs have restrictions. The California High-Speed Rail Authority and other regional and local governments have policies (such as a Project Labor Agreement, aka “Community Benefits Agreement”) to ensure construction unions get a monopoly on recruitment, training, and dispatch of workers to high-speed rail jobs. Allegedly this would provide job opportunities for disadvantaged residents who would otherwise remain in poverty. Public records just obtained from the Fresno-based State Center Community College District reveal that unions did not offer apprenticeship opportunities to most of the 69 people who completed a union-affiliated pre-apprenticeship program funded by a state grant. Performance results for this program suggest that unions are reserving high-speed rail jobs for more favored individuals. Ironically, a few workers ended up getting jobs from local non-union contractors.
Although the share of industrial jobs has shrunken from 10.5% of all nonfarm employment in 2005 to 8.5% today, manufacturing continues to have an outsized influence on regional economies, as is spelled out in the latest paper from the Center for Opportunity Urbanism. This stems in large part from the industrial sector’s productivity gains since 2001 -- almost twice as much as the economy-wide average, according to the Bureau of Labor Statistics -- and it has a far higher multiplier effect (the boost it provides to local job and wealth creation) than virtually any other sector. Manufacturing generates $1.40 in economic activity for every dollar put in, according to the U.S. Bureau of Economic Analysis, far greater than the multiplier generated by business services, information, retail trade or finance.
Economists have long been puzzling over why productivity has downshifted over the past decade, often blaming waning technological innovation for the pullback. New research, though, points to an overlooked culprit: the shortage of credit to many companies that followed the financial crisis. . . Tight credit conditions and balance-sheet vulnerabilities could be responsible for as much as one-third of the productivity slowdown in advanced economies following the 2008 global financial crisis, according to an International Monetary Fund research paper by Gee Hee Hong, Romain Duval and Yannick Timmer. This slowdown has swept across nations like Japan, the U.S. and France.
Unemployment dropped last month to its lowest level since 2001, yet wage growth is below levels seen in the late stages of previous economic expansions and underemployment remains above the lows of the previous cycles. These dissonant readings point to an increasing mismatch between workers’ skills and the roles employers are seeking to fill, a conflict measured by the Beveridge curve, which tracks the relationship between unemployment and job vacancies. The higher level of the curve since the 2008 crisis shows the workforce isn’t entirely satisfying the need for skills that have become more important in the postrecession economy.
LAEDC’s Institute for Applied Economics has released the report, Goods on the Move: Trade and Logistics in Southern California. The report looks at jobs, wages, economic impact, trends, and factors affecting the future of this major regional industry cluster, which directly employs over half a million people in Southern California. The industry continues to grow, with more jobs being added. While average wages for the industry as a whole are above the LA County average, the individual occupations span a wide range of salaries. Warehousing experienced a 55% increase in employment during the past ten years, but salaries in that sector have been trending down, and increasing automation is a factor to watch.