05/09/2021

Reports » Job Reports

July 2016

Highlights for policy makers:

Unemployment Rate Rises to 5.5%; Total Employment Up 35,500

The Labor Force data for July 2016 (seasonally adjusted; California preliminary) is shown below, along with the change from the prior month:

Seasonally Adjusted California US
Jul 2016 Change from Jun 2016 Jul 2016 Change from Jun 2016
Unemployment Rate 5.5 0.1 4.9 0.0
Labor Force 19,161,800 0.3% 159,287,000 0.3%
Participation Rate 62.1 0.2 62.8 0.1
Employment 18,114,100 0.2% 151,517,000 0.3%
Unemployment 1,047,700 2.4% 7,770,000 -0.2%
Source: California Employment Development Department; US Bureau of Labor Statistics

The related not seasonally adjusted numbers (California preliminary), with the change from July 2015:

Not Seasonally Adjusted California US
Jul 2016 Change from Jul 2015 Jul 2016 Change from Jul 2015
Unemployment Rate 5.9 -0.6 5.1 -0.5
Labor Force 19,369,434 1.6% 160,705,000 1.4%
Participation Rate 62.7 0.3 63.4 0.2
Employment 18,233,999 2.4% 152,437,000 1.8%
Unemployment 1,135,435 -8.9% 8,267,000 -6.1%
Source: California Employment Development Department; US Bureau of Labor Statistics

California Employment Development Department’s (EDD) latest release shows on a seasonally adjusted basis, total employment grew by 35,500 from June, while the number of unemployed grew by 24,700. California’s seasonally adjusted unemployment rate also notched up from 5.4% in June to 5.5% in July. California tied with Rhode Island for the 15th highest unemployment rate among the states. The unadjusted rate decreased from 6.5% in July 2015 to 5.9% in July 2016.

Total US employment saw a seasonally adjusted increase of 420,000, while the number of unemployed remained little changed with a drop of only 13,000. The national unemployment rate remained level at 4.9%.

Labor Force Participation Rate Improves to 62.1%

With the underlying unadjusted rate increasing significantly over the past two months, California’s participation rate (seasonally adjusted) rose 0.2 points to 62.1% in July.  The comparable US rate increased 0.1 points to 62.8%.

The latest increases in the participation rate have produced the first time this measure has exceeded 62.0% since August 2015.  The two months of back-to-back significant increases in the unadjusted data, however, have yet to establish whether the improvement represents a trend.

While the participation rate shows its first apparent improvement in a year, the overall rate still remains near the previous lows from 1976, and well below the average pre-recession level of 65.6% in 2007.

State Employment Growth Rankings

Change in Employment, July 2015 – July 2016
Rank Number of Employed Percentage Change Population Adjusted
(employment growth per 1,000 civilian
noninstitutional population)
1 CA 319,648 OR 5.3% OR 30.3
2 TX 201,354 TN 3.9% TN 21.9
3 GA 158,664 DE 3.5% DE 21.1
4 FL 148,418 GA 3.5% IN 20.5
5 NC 114,518 AR 3.4% GA 20.4
6 TN 113,198 IN 3.4% DC 20.1
7 MI 105,979 DC 3.1% AR 18.8
8 IN 104,900 SC 2.9% CO 16.8
9 OR 97,738 AZ 2.7% SC 15.8
10 OH 85,691 CO 2.6% AZ 15.0
11 IL 80,436 NC 2.6% NH 14.7
12 AZ 79,108 MI 2.4% NC 14.7
13 WA 73,856 NH 2.2% MI 13.5
14 CO 71,252 WA 2.2% ID 13.1
15 SC 60,603 ID 2.1% WA 13.1
16 MA 60,033 UT 2.0% UT 12.9
17 PA 52,549 CA 1.8% MA 10.9
18 WI 46,434 MA 1.8% CA 10.5
19 NJ 43,632 KY 1.7% WI 10.2
20 MD 43,268 FL 1.6% TX 9.8
21 AR 43,144 TX 1.6% OH 9.4
22 KY 31,483 OH 1.6% MD 9.2
23 UT 27,689 WI 1.6% KY 9.1
24 AL 27,591 MD 1.4% FL 9.1
25 ID 16,405 ME 1.4% SD 9.1
26 NH 15,930 AL 1.4% ND 8.9
US 2,651,000  US 1.8%  US 10.5
Source: US Bureau of Labor Statistics, Seasonally Adjusted

Between July 2015 and July 2016, Bureau of Labor Statistics (BLS) data shows the total number of employed in California increased by 319,648 (seasonally adjusted), or 12.1% of the total net employment gains in this period for the US.  Measured by percentage change in employment over the year, California was 17th highest.  Adjusted for population, California ranked 18th.    

Nonfarm Jobs Increase 36,400

EDD reported that between June and July 2016, seasonally adjusted nonfarm payroll jobs increased by 36,400.  May’s gains were revised downwards to 33,200 from the previously reported gain of 40,300.     

Looking at the not seasonally adjusted numbers, hiring saw increases in all but 2 industries.  The change in total payroll jobs from July 2015 saw the largest increases in Health Care & Social Services (62,400), Government (52,300), and Professional, Scientific & Professional Services (51,400).  Declines were in Manufacturing (-5,400) and Mining & Logging (-3,500).   Rankings based on the monthly change from June were dominated by school vacation changes in Government and Educational Services.

Not Seasonally Adjusted Payroll Jobs Jun 2016 Jul 2016 Jul 2016 – Jun 2016 Jul 2016 – Jul 2015
Total Farm 484,300 477,100 -7,200 1,500
Mining & Logging 26,100 26,100 0 -3,500
Construction 769,500 776,200 6,700 27,900
Manufacturing 1,290,300 1,304,300 14,000 -5,600
Wholesale Trade 742,400 744,000 1,600 19,700
Retail Trade 1,673,400 1,683,500 10,100 31,000
Transportation, Warehousing & Utilities 564,200 564,500 300 7,000
Information 495,700 494,500 -1,200 10,000
Finance & Insurance 530,300 531,100 800 900
Real Estate & Rental & Leasing 283,200 284,400 1,200 8,200
Professional, Scientific & Technical Services 1,263,000 1,268,400 5,400 51,400
Management of Companies & Enterprises 235,000 236,300 1,300 5,100
Administrative & Support & Waste Services 1,086,700 1,078,600 -8,100 20,300
Educational Services 364,800 345,900 -18,900 29,600
Health Care & Social Assistance 2,178,000 2,176,000 -2,000 62,400
   Individual & Family Services 592,100 589,700 -2,400 15,100
Arts, Entertainment, & Recreation 322,000 326,600 4,600 21,300
Accommodation & Food Service 1,610,000 1,605,700 -4,300 43,300
Other Services 558,700 554,300 -4,400 1,700
Government 2,556,500 2,378,200 -178,300 52,300
Total Nonfarm 16,549,800 16,378,600 -171,200 383,000
Total Wage & Salary 17,034,100 16,855,700 -178,400 384,500
Source: California Employment Development Department

By total number of new jobs, California had the highest increase in seasonally adjusted nonfarm jobs among the states from July 2015 to July 2016, at 374,600 or 15.3% of the US net increase.  By percentage growth in jobs, California was 11th highest, and by population adjusted jobs growth, 14th highest.  

Change in Nonfarm Jobs (seasonally adjusted), July 2015 – July 2016
Rank Number of Jobs Employment Growth (%) Population Adjusted
(job growth per 1,000 civilian
noninstitutional population)
1 CA 374,600 ID 3.4% UT 19.3
2 FL 250,200 OR 3.3% ID 17.9
3 TX 173,000 FL 3.1% OR 17.8
4 GA 116,200 UT 3.1% CO 17.1
5 NY 114,300 WA 3.0% WA 16.5
6 MI 105,500 CO 2.9% FL 15.0
7 WA 94,400 GA 2.7% GA 14.7
8 NC 94,100 AZ 2.6% SD 14.5
9 OH 78,800 NV 2.5% NV 13.9
10 CO 74,200 MI 2.5% MI 13.3
11 AZ 67,300 CA 2.3% DE 13.2
12 MA 65,500 SC 2.3% HI 12.8
13 TN 58,600 SD 2.2% AZ 12.5
14 OR 58,200 DE 2.2% CA 12.1
15 PA 58,000 NC 2.2% VT 12.0
16 VA 57,200 HI 2.2% NC 11.9
17 NJ 55,800 TN 2.0% SC 11.9
18 MD 53,200 MD 2.0% MA 11.8
19 WI 47,400 VT 2.0% TN 11.2
20 SC 46,100 MA 1.9% MD 11.2
US 2,447,000 US 1.7% US 9.6
Source: US Bureau of Labor Statistics

Five Industries Below 2007 Pre-Recession Job Levels

Source: California Employment Development Department, Wage & Salary Jobs (seasonally adjusted), wages are running 4 quarter average from QCEW wage data

Comparing the number of jobs by industry in July 2016 (seasonally adjusted), 5 industries continued to experience employment below the 2007 pre-recession levels.  In the highest gain industries, Health Care & Social Assistance remained the leading industry, followed by lowest wage Accommodation & Food Services and higher wage Professional, Scientific & Technical Services.

Two-Tier Economy Persists

Unemployment rates (all data is not seasonally adjusted) continue to vary widely across the state, ranging from 4.4% in the Bay Area to more than double at 9.7% in the Central Valley. 

Not Seasonally Adjusted Unemployment Rate (%) July 2016
California 5.6
Bay Area 4.4
Orange County 4.6
Los Angeles 5.5
Sacramento Region 5.8
Central Coast 5.9
Central Sierra 6.1
San Diego/Imperial 6.2
Inland Empire 6.9
Upstate California 7.4
Central Valley 9.7

By Legislative District:

Lowest 10 Unemployment Rates
CD18 (Eshoo-D) 3.4 SD13 (Hill-D) 3.3 AD16 (Baker-R) 3.2
CD12 (Pelosi-D) 3.5 SD11 (Leno-D) 3.7 AD22 (Mullin-D) 3.2
CD45 (Walters-R) 3.7 SD37 (Moorlach-R) 3.9 AD24 (Gordon-D) 3.4
CD14 (Speier-D) 3.8 SD26 (Allen-D) 4.1 AD28 (Low-D) 3.5
CD52 (Peters-D) 3.8 SD39 (Block-D) 4.2 AD17 (Chiu-D) 3.7
CD33 (Lieu-D) 3.9 SD36 (Bates-R) 4.3 AD19 (Ting-D) 3.8
CD17 (Honda-D) 3.9 SD15 (Beall-D) 4.4 AD77 (Maienschein-R) 3.8
CD27 (Chu-D) 4.1 SD25 (Liu-D) 4.5 AD66 (Hadley-R) 3.8
CD02 (Huffman-D) 4.4 SD07 (Glazer-D) 4.5 AD74 (Harper-R) 3.9
CD48 (Rohrabacher-R) 4.4 SD32 (Mendoza-D) 4.6 AD73 (Brough-R) 3.9
Highest 10 Unemployment Rates
CD44 (Hahn-D) 7.5 SD28 (Stone-R) 6.8 AD80 (Gonzalez-D) 8.0
CD36 (Ruiz-D) 7.6 SD20 (Leyva-D) 7.0 AD03 (Gallagher-R) 8.2
CD41 (Takano-D) 8.0 SD04 (Nielsen-R) 7.1 AD23 (Patterson-R) 8.4
CD09 (McNerney-D) 8.0 SD31 (Roth-D) 7.1 AD34 (Grove-R) 8.6
CD10 (Denham-R) 8.4 SD08 (Berryhill-R) 8.0 AD13 (Eggman-D) 9.0
CD23 (McCarthy-R) 9.1 SD05 (Galgiani-D) 8.3 AD31 (Arambula-D) 10.7
CD22 (Nunes-R) 9.2 SD12 (Cannella-R) 8.9 AD21 (Gray-D) 10.7
CD16 (Costa-D) 10.6 SD16 (Fuller-R) 9.1 AD26 (Mathis-R) 11.0
CD21 (Valadao-R) 11.6 SD40 (Hueso-D) 10.4 AD32 (Salas-D) 12.3
CD51 (Vargas-D) 12.2 SD14 (Vidak-R) 12.4 AD56 (Garcia-D) 14.3

Nine California MSAs in the 10 Worst Unemployment Rates Nationally

Of the 10 Metropolitan Statistical Areas (MSAs) with the worst unemployment rates nationally, 9 are in California.  Of the 20 worst, 10 are in California.

US Rank MSA Jun 2016 Unemployment Rate
365 Weirton-Steubenville, WV-OH Metropolitan Statistical Area 7.5
369 Brownsville-Harlingen, TX Metropolitan Statistical Area 7.6
369 Longview, WA Metropolitan Statistical Area 7.6
371 Las Cruces, NM Metropolitan Statistical Area 7.7
372 Casper, WY Metropolitan Statistical Area 7.8
373 Lafayette, LA Metropolitan Statistical Area 8.0
374 Hammond, LA Metropolitan Statistical Area 8.1
375 McAllen-Edinburg-Mission, TX Metropolitan Statistical Area 8.2
376 Stockton-Lodi, CA Metropolitan Statistical Area 8.3
377 Farmington, NM Metropolitan Statistical Area 9.1
378 Modesto, CA Metropolitan Statistical Area 9.2
379 Fresno, CA Metropolitan Statistical Area 9.4
379 Madera, CA Metropolitan Statistical Area 9.4
379 Yuba City, CA Metropolitan Statistical Area 9.4
382 Hanford-Corcoran, CA Metropolitan Statistical Area 10.2
383 Merced, CA Metropolitan Statistical Area 10.6
384 Bakersfield, CA Metropolitan Statistical Area 10.8
384 Visalia-Porterville, CA Metropolitan Statistical Area 10.8
386 Yuma, AZ Metropolitan Statistical Area 22.2
387 El Centro, CA Metropolitan Statistical Area 23.7

New Housing Units Down 1.2% in Second Quarter

The most recent permit data from California Homebuilding Foundation shows the number of housing units covered by new construction permits in 2016 Q2 was down 1.2% from the same period in the prior year, continuing a downward trend of the past three quarters.  Total number of single-family and multi-family units combined was 27,429 for the quarter.

The quarterly results translate into an annualized level of 101,000 new units based on total permits this year to date, or about half the number of new units required just to keep up with the state’s population growth.  The current State Housing Plan projected a need for 220,000 new units annually to keep pace with projected population growth and adjust for retirement of units through demolition, conversions, and other removals such as fires.  More recent estimates peg the annual need at 200,000 in light of the state’s slowing population growth.  Since 1990, housing has reached these levels only in the years 2003-2005, with construction of new units failing to match pace with population growth or contribute to the cumulative supply shortage in the remainder of the past quarter century.

The cumulative gap since 1997—the period covered by the current State Housing Plan—is illustrated in the following chart, comparing the cumulative number of actual permitted residential units to the cumulative new supply needs.   Through the second half of 2016, the cumulative gap ranges from 2.0 million units at the higher needs estimate (220,000 a year) to 1.6 million at the lower (200,000 a year).  Note that these numbers do not include additional cumulative shortfalls from prior years.

While this gap persists and has been growing, the number of new housing units covered by construction permits has recovered significantly from the recent recessionary lows, which dropped as low as 36,421 in 2009.  The current level of 85-100,000 new units annually over the past 3-½ years, however, is only equivalent to the lowest levels experienced by the state in the earlier 1990s recession. 

This drop in the level of new permits also translates directly into fewer jobs.  Total construction employment in 2016 Q2 averaged 760,500, an improvement from the recessionary lows but down 19% from the previous high of 933,700 construction jobs in 2006.  This continued net loss of over 170,000 higher paying blue-collar jobs (average annual wage of $61,100) contributes significantly to income disparity in the state and the growing divides of the two-tier economy.

As shown in the following chart, the number of new housing units in 2016 Q2 was up in Orange County and marginally so in Central Valley and Central Coast.  Permit activity remained essentially level or dropped in the other regions.  For comparison, the chart also shows the average quarterly levels from the last “full supply” year of 2005.  This chart also illustrates that while new housing was strong in the interior regions prior to the recession, new construction has now shifted to regions producing the incomes necessary to afford rapidly rising home prices in the state.

Starting with this quarter, the New Residential Permits data in the Economic Indicators now incorporate data on the number of units as well.  Further details along with data for the state, regions, and counties is provided on the Center’s web site.

Note: All data sources, methodologies, and historical data series available at CenterforJobs.org.