The Center for Jobs and the Economy has released our initial analysis of the February Employment Report from the California Employment Development Department.
The February job and employment numbers saw some improvement in the state’s recovery levels, with employment gains continuing the January performance and nonfarm jobs rising at a higher rate. Nonfarm jobs (seasonally adjusted) are now only 2.0% below the pre-pandemic peak high in February 2020 compared to the rest of the nation at 1.3% below. Employment, however, remains further behind at 3.6% below the prior peak, while the rest of the nation came close to touching this recovery milestone at only 0.3% below.
While the past two months have shown some improvement in the overall numbers, California’s position relative to the other states showed little change. Counting only those states with nonfarm job levels still below the prior peak, California accounts for 20% of the remaining gap, while 12 states are now above the pre-pandemic job levels and another, Mississippi, is only 200 jobs below.
The employment lags remain more significant. California accounts for 22% of the states still showing an employment gap, while 20 states again showed more people working than before the pandemic. The state’s unemployment rate of 5.4%, while improving, remained the 3rd highest in the nation in a tie with Alaska; 22 states had unemployment rates at or below the February 2020 level.
California’s lag in moving people back to work is also reflected in the more current weekly unemployment insurance claims data. The latest report for the week of March 19 shows California initial claims finally back to the pre-pandemic average in 2019 but claims for the other states were 16% below. California continued to account for 22% of all initial claims nationally and 23% of all continuing claims as of the week before, a proxy for the number of workers receiving unemployment benefits. The other states are making greater strides in getting people back to work. California continues to rely on this and other assistance programs rather than making the hard reforms to improve the state’s jobs climate, especially for the middle class wage jobs growing in the states where Californians are now moving. This will likely continue for the upcoming months.