Highlights for policy makers:
- Unemployment Rate Continues Dropping to 4.7%; Total Employment Little Changed at 3,600
- Labor Force Participation Rate at Lowest Level Since 1976
- State Employment Growth Rankings—California Drops to 3rd Place Behind Florida and Texas
- Nonfarm Jobs Up 17,600
- 6 Industries below 2007 Pre-Recession Job Levels
- Job Gains by Wage Level
- Two-Tier Economy Persists—Central Valley Unemployment More than Twice as High as Bay Area
- Bay Area Provided 42% of Net Employment Growth Since Recession
- 8 California MSAs in the 10 Worst Unemployment Rates Nationally
Unemployment Rate Continues Dropping to 4.7%; Total Employment Little Changed at 3,600
The Labor Force data for May 2017 (seasonally adjusted; California preliminary) is shown below, along with the change from the prior month:
| Seasonally Adjusted | California | US | ||
|---|---|---|---|---|
| May 2017 | Change from Apr 2017 | May 2017 | Change from Apr 2017 | |
| Unemployment Rate | 4.7 | -0.1 | 4.3 | -0.1 |
| Labor Force | 19,156,000 | -0.1% | 159,784,000 | -0.3% |
| Participation Rate | 62.0 | -0.1 | 62.7 | -0.2 |
| Employment | 18,258,200 | 0.0% | 152,923,000 | -0.2% |
| Unemployment | 897,800 | -2.9% | 6,861,000 | -2.8% |
The related not seasonally adjusted numbers (California preliminary), with the change from May 2016:
| Not Seasonally Adjusted | California | US | ||
|---|---|---|---|---|
| May 2017 | Change from May 2016 | May 2017 | Change from May 2016 | |
| Unemployment Rate | 4.2 | -0.7 | 4.1 | -0.4 |
| Labor Force | 19,061,300 | 0.2% | 159,979,000 | 0.7% |
| Participation Rate | 61.7 | -0.4 | 62.8 | 0.1 |
| Employment | 18,255,700 | 1.0% | 153,407,000 | 1.2% |
| Unemployment | 805,600 | -14.4% | 6,572,000 | -8.8% |
California Employment Development Department’s (EDD) latest release shows on a seasonally adjusted basis, total employment rose marginally by 3,600 from April, while the number of unemployed dropped by 26,000. The labor force dropped by 23,000.
California’s seasonally adjusted unemployment rate continued dropping to 4.7%, matching the previous lows (since 1976) in November and December 2000. California tied with Nevada for the 14th highest unemployment rate among the states. The unadjusted rate dropped from 4.9% in May 2016 to 4.2%.
Total US employment saw a seasonally adjusted decrease of 233,000 from April, while the number of unemployed dropped by 195,000. The national unemployment rate continued easing 0.1 point to 4.3%. The national labor force numbers declined by 429,000.
Labor Force Participation Rate at Lowest Level Since 1976
California’s participation rate (seasonally adjusted) in May declined to 62.0%, while the US rate dropped 0.2 point to 62.7%. Improvement in the unemployment rate at both the California and national levels came from these contractions in the labor force numbers.
The seasonally adjusted California participation rate in May was at its lowest level since 1976. The unadjusted rate was at its second lowest level since 1976.
State Employment Growth Rankings—California Drops to 3rd Place Behind Florida and Texas
| Rank | Number of Employed | Percentage Change | Population Adjusted (employment growth per 1,000 civilian noninstitutional population) |
|---|---|---|---|
| 1 | FL 409,600 | KY 4.8% | UT 30.3 |
| 2 | TX 254,800 | UT 4.6% | KY 26.3 |
| 3 | CA 250,000 | FL 4.4% | CO 25.1 |
| 4 | NY 189,800 | OR 4.0% | FL 24.7 |
| 5 | GA 156,000 | CO 3.9% | OR 24.1 |
| 6 | MI 108,800 | AZ 3.5% | GA 19.8 |
| 7 | CO 108,200 | GA 3.4% | AZ 19.8 |
| 8 | MA 106,600 | MA 3.1% | MA 19.3 |
| 9 | AZ 105,900 | MS 2.9% | DC 16.5 |
| 10 | NC 97,300 | WA 2.7% | WA 16.4 |
| 11 | WA 93,500 | ME 2.7% | ME 16.3 |
| 12 | VA 93,000 | HI 2.5% | WI 15.8 |
| 13 | KY 90,800 | DC 2.5% | MS 15.5 |
| 14 | OR 78,900 | AL 2.5% | HI 15.3 |
| 15 | OH 76,500 | NV 2.4% | CT 14.7 |
| 16 | WI 72,000 | WI 2.4% | MD 14.4 |
| 17 | TN 70,700 | MI 2.4% | VA 14.2 |
| 18 | MD 68,000 | TN 2.4% | NV 14.1 |
| 19 | UT 66,400 | SC 2.4% | ND 13.9 |
| 20 | PA 65,900 | CT 2.4% | MI 13.8 |
| 21 | NJ 58,100 | VA 2.3% | TN 13.6 |
| 22 | IN 52,400 | MD 2.2% | SC 13.3 |
| 23 | SC 51,600 | NC 2.1% | AL 13.2 |
| 24 | AL 50,300 | NY 2.1% | NC 12.4 |
| 25 | CT 42,300 | TX 2.0% | TX 12.2 |
| 26 | MN 39,900 | ND 2.0% | NY 12.0 |
| 27 | MS 35,500 | RI 1.9% | RI 11.8 |
| 28 | NV 32,400 | AK 1.7% | AK 10.5 |
| 29 | IL 31,900 | ID 1.7% | ID 10.3 |
| 30 | AR 19,000 | IN 1.7% | IN 10.2 |
| 31 | ME 17,800 | AR 1.5% | MN 9.3 |
| 32 | OK 16,800 | OH 1.4% | OH 8.4 |
| 33 | HI 16,700 | CA 1.4% | AR 8.2 |
| 34 | ID 13,100 | MN 1.4% | NJ 8.2 |
| 35 | RI 10,100 | NJ 1.4% | CA 8.2 |
| US 1,865,000 | US 1.2% | US 7.4 |
Between May 2016 and May 2017, Bureau of Labor Statistics (BLS) data shows the total number of employed in California increased by 250,000 (seasonally adjusted), or 13.4% of the total net employment gains in this period for the US. California dropped to 3rd place behind Florida (which has a civilian working age population only 55% as large as California’s) at 409,600 and Texas (68% as large) at 254,800. Measured by percentage change in employment over the year, California dropped to 33rd highest. Adjusted for population, California dropped to 35th.
Nonfarm Jobs Up 17,600
EDD reported that between April and May 2017, seasonally adjusted nonfarm wage and salary jobs were up 17,600. April’s losses were revised up to 17,600 from the previously reported loss of 22,800.
Looking at the not seasonally adjusted nonfarm numbers, hiring saw increases in all but five industries over the year. The change in total payroll jobs from May 2016 saw the largest increases in Government (49,800) as tax and fee revenues have continued to expand, Construction (41,600), and Food Services (31,200). Declines were in Manufacturing (-7,800), Retail Trade (-2,000), and Mining & Logging (-1,800).
| Not Seasonally Adjusted Payroll Jobs | May 2017 | April 2017 | Change May 2017 – April 2017 | Change May 2017 – May 2016 |
|---|---|---|---|---|
| Total Farm | 484,300 | 434,200 | 50,100 | 7,700 |
| Mining and Logging | 22,700 | 22,500 | 200 | -1,800 |
| Construction | 810,300 | 800,100 | 10,200 | 41,600 |
| Manufacturing | 1,296,000 | 1,291,500 | 4,500 | -7,800 |
| Wholesale Trade | 736,100 | 729,700 | 6,400 | 14,200 |
| Retail Trade | 1,658,500 | 1,660,800 | -2,300 | -2,000 |
| Utilities | 58,300 | 58,400 | -100 | -800 |
| Transportation & Warehousing | 529,200 | 526,000 | 3,200 | 8,700 |
| Information | 528,200 | 521,300 | 6,900 | -500 |
| Finance & Insurance | 546,700 | 545,000 | 1,700 | 3,000 |
| Real Estate & Rental & Leasing | 280,500 | 280,000 | 500 | 3,100 |
| Professional, Scientific & Technical Services | 1,225,100 | 1,234,700 | -9,600 | 16,200 |
| Management of Companies & Enterprises | 227,000 | 227,200 | -200 | 2,200 |
| Administrative & Support & Waste Services | 1,080,800 | 1,068,200 | 12,600 | 4,800 |
| Educational Services | 376,800 | 379,700 | -2,900 | 11,500 |
| Health Care | 1,481,400 | 1,479,600 | 1,800 | 27,600 |
| Social Assistance | 755,200 | 752,800 | 2,400 | 26,500 |
| Arts, Entertainment & Recreation | 308,200 | 303,600 | 4,600 | 4,700 |
| Accommodation | 224,900 | 222,800 | 2,100 | 3,600 |
| Food Services | 1,414,500 | 1,408,800 | 5,700 | 31,200 |
| Other Services | 577,900 | 573,500 | 4,400 | 21,400 |
| Government | 2,610,600 | 2,593,200 | 17,400 | 49,800 |
| Total Nonfarm | 16,748,900 | 16,679,400 | 69,500 | 257,200 |
| Total Wage and Salary | 17,233,200 | 17,113,600 | 119,600 | 264,900 |
By total number of new jobs, California continued to show the second highest increase in seasonally adjusted nonfarm jobs among the states from May 2016 to May 2017, at 242,600 or 10.7% of the US net increase. Texas led jobs growth with 266,600 jobs and Florida was a close third with 228,000. By percentage growth in jobs, California dropped to 23rd highest at 1.5%, below the US average of 1.6%. By population adjusted jobs growth, California dropped to 31st highest, also below the US average.
| Rank | Number of Jobs | Employment Growth (%) | Population Adjusted (job growth per 1,000 civilian noninstitutional population) |
|---|---|---|---|
| 1 | TX 266,600 | UT 3.3% | UT 21.2 |
| 2 | CA 242,600 | FL 2.7% | DC 20.0 |
| 3 | FL 228,000 | NV 2.7% | NV 15.3 |
| 4 | NY 149,100 | ID 2.4% | CO 14.4 |
| 5 | GA 103,100 | CO 2.4% | FL 13.8 |
| 6 | WA 76,200 | OR 2.4% | WA 13.3 |
| 7 | MI 74,400 | GA 2.4% | ID 13.2 |
| 8 | NC 69,200 | WA 2.4% | OR 13.2 |
| 9 | CO 62,000 | TX 2.2% | GA 13.1 |
| 10 | MA 58,300 | TN 1.9% | TX 12.8 |
| 11 | TN 57,500 | AZ 1.8% | MN 11.1 |
| 12 | PA 54,000 | AL 1.8% | TN 11.0 |
| 13 | AZ 49,300 | AR 1.8% | MA 10.6 |
| 14 | MN 47,700 | MI 1.7% | MO 9.9 |
| 15 | MO 47,000 | MO 1.7% | AR 9.5 |
| 16 | UT 46,600 | MN 1.7% | NY 9.4 |
| 17 | VA 44,400 | MA 1.6% | MI 9.4 |
| 18 | OR 43,300 | NC 1.6% | AL 9.4 |
| 19 | NJ 43,100 | SC 1.6% | AZ 9.2 |
| 20 | MD 43,100 | MD 1.6% | MD 9.1 |
| 21 | IN 41,700 | NY 1.6% | MT 9.0 |
| 22 | OH 41,100 | MT 1.6% | WI 8.8 |
| 23 | WI 40,400 | CA 1.5% | NC 8.8 |
| 24 | AL 35,800 | RI 1.5% | NH 8.7 |
| 25 | NV 35,000 | DC 1.4% | SC 8.4 |
| 26 | IL 34,700 | NH 1.4% | RI 8.3 |
| 27 | SC 32,700 | WI 1.4% | ND 8.2 |
| 28 | KY 26,400 | KY 1.4% | SD 8.2 |
| 29 | AR 22,000 | IN 1.4% | IN 8.1 |
| 30 | ID 16,800 | HI 1.3% | NE 8.1 |
| 31 | IA 15,200 | SD 1.3% | CA 7.9 |
| 32 | NE 11,700 | NE 1.2% | KY 7.6 |
| 33 | DC 11,200 | VA 1.1% | HI 7.4 |
| US 2,266,000 | US 1.6% | US 9.0 |
Six Industries Below 2007 Pre-Recession Job Levels
Comparing the number of jobs by industry in May 2017 (not seasonally adjusted), 6 industries had employment below the 2007 pre-recession levels. In the highest gain industries, Health Care and lower wage Food Services were essentially tied as the leading job gains, while lower wage Social Assistance and higher wage Professional, Scientific & Technical Services remained in 3rd and 4th place, respectively. Of the lagging industries, three—Manufacturing, Mining & Logging, and Construction—are blue collar middle class wage industries, while the higher wage Finance & Insurance also continued to lose ground.
Job Gains by Wage Level
In the recent May Budget Revision, the Governor again pointed to the increasing share of lower wage jobs as one of the prime causes of slowing state revenues growth: The level of wages has been revised downward, and cash receipts have been significantly below forecast. The following chart illustrates this trend, according to the industry wage classification used previously in other Center analyses of this issue. In the chart below, Private sector jobs are shown in the dark green bands, while Government is shown in the lighter. As indicated, over one-third of jobs growth over the past 12 months has been in the low wage industries.
Two-Tier Economy Persists
Unemployment rates (all data is not seasonally adjusted) continue to vary widely across the state, ranging from 3.1% in the Bay Area to more than twice as large at 7.6% in the Central Valley.
| Not Seasonally Adjusted | Unemployment Rate (%) MAY 2017 |
|---|---|
| California | 4.2 |
| Bay Area | 3.1 |
| Orange County | 3.2 |
| Los Angeles | 4.0 |
| Sacramento Region | 4.1 |
| San Diego/Imperial | 4.4 |
| Central Sierra | 4.5 |
| Inland Empire | 4.5 |
| Central Coast | 4.6 |
| Upstate California | 5.5 |
| Central Valley | 7.6 |
By Legislative District:
| Lowest 10 Unemployment Rates | |||||
|---|---|---|---|---|---|
| CD18 (Eshoo-D) | 2.4 | SD13 (Hill-D) | 2.3 | AD16 (Baker-R) | 2.2 |
| CD12 (Pelosi-D) | 2.5 | SD11 (Wiener-D) | 2.7 | AD22 (Mullin-D) | 2.2 |
| CD52 (Peters-D) | 2.6 | SD37 (Moorlach-R) | 2.8 | AD24 (Berman-D) | 2.4 |
| CD45 (Walters-R) | 2.6 | SD39 (Atkins-D) | 2.8 | AD28 (Low-D) | 2.5 |
| CD14 (Speier-D) | 2.7 | SD36 (Bates-R) | 2.9 | AD77 (Maienschein-R) | 2.6 |
| CD17 (Khanna-D) | 2.8 | SD26 (Allen-D) | 3.0 | AD73 (Brough-R) | 2.7 |
| CD33 (Lieu-D) | 2.9 | SD07 (Glazer-D) | 3.1 | AD17 (Chiu-D) | 2.7 |
| CD49 (Issa-R) | 2.9 | SD15 (Beall-D) | 3.1 | AD78 (Gloria-D) | 2.7 |
| CD15 (Swalwell-D) | 3.0 | SD10 (Wieckowski-D) | 3.1 | AD19 (Ting-D) | 2.7 |
| CD27 (Chu-D) | 3.1 | SD02 (McGuire-D) | 3.2 | AD74 (Harper-R) | 2.8 |
| Highest 10 Unemployment Rates | |||||
|---|---|---|---|---|---|
| CD20 (Panetta-D) | 5.2 | SD30 (Mitchell-D) | 4.7 | AD64 (Gipson-D) | 5.8 |
| CD03 (Garamendi-D) | 5.2 | SD21 (Wilk-R) | 4.8 | AD03 (Gallagher-R) | 6.1 |
| CD44 (Barragán-D) | 5.6 | SD35 (Bradford-D) | 4.9 | AD23 (Patterson-R) | 6.5 |
| CD09 (McNerney-D) | 5.8 | SD04 (Nielsen-R) | 5.2 | AD34 (Fong-R) | 6.6 |
| CD10 (Denham-R) | 6.5 | SD05 (Galgiani-D) | 6.2 | AD13 (Eggman-D) | 6.7 |
| CD22 (Nunes-R) | 7.0 | SD08 (Berryhill-R) | 6.2 | AD26 (Mathis-R) | 8.4 |
| CD23 (McCarthy-R) | 7.1 | SD16 (Fuller-R) | 6.8 | AD31 (Arambula-D) | 8.6 |
| CD16 (Costa-D) | 8.6 | SD12 (Cannella-R) | 7.1 | AD21 (Gray-D) | 8.6 |
| CD51 (Vargas-D) | 9.4 | SD40 (Hueso-D) | 7.8 | AD32 (Salas-D) | 10.1 |
| CD21 (Valadao-R) | 9.4 | SD14 (Vidak-R) | 10.1 | AD56 (Garcia-D) | 10.8 |
Bay Area Provided 42% of Net Employment Growth Since Recession
Containing just under 20% of the state’s population, the Bay Area was responsible for 41.9% of the net growth in employment since the pre-recession peaks in 2007. Los Angeles Region provided the next largest share at 22.6%, but spread over 29.3% of the population. Inland Empire is the only other region showing employment gains above their population share.
Eight California MSAs in the 10 Worst Unemployment Rates Nationally
Of the 10 Metropolitan Statistical Areas (MSAs) with the worst unemployment rates nationally, 8 are in California. Of the 20 worst, 12 are in California.
| US Rank | MSA | April 2017 Unemployment Rate |
|---|---|---|
| 369 | Rockford, IL Metropolitan Statistical Area | 6.9 |
| 369 | Santa Cruz-Watsonville, CA Metropolitan Statistical Area | 6.9 |
| 371 | Las Cruces, NM Metropolitan Statistical Area | 7.1 |
| 371 | Stockton-Lodi, CA Metropolitan Statistical Area | 7.1 |
| 373 | Salinas, CA Metropolitan Statistical Area | 7.2 |
| 374 | Beaumont-Port Arthur, TX Metropolitan Statistical Area | 7.4 |
| 375 | Brownsville-Harlingen, TX Metropolitan Statistical Area | 7.5 |
| 376 | Farmington, NM Metropolitan Statistical Area | 7.7 |
| 377 | Modesto, CA Metropolitan Statistical Area | 7.9 |
| 378 | McAllen-Edinburg-Mission, TX Metropolitan Statistical Area | 8.0 |
| 379 | Madera, CA Metropolitan Statistical Area | 8.5 |
| 380 | Fresno, CA Metropolitan Statistical Area | 8.8 |
| 381 | Yuba City, CA Metropolitan Statistical Area | 8.9 |
| 382 | Ocean City, NJ Metropolitan Statistical Area | 9.1 |
| 383 | Bakersfield, CA Metropolitan Statistical Area | 9.5 |
| 384 | Hanford-Corcoran, CA Metropolitan Statistical Area | 9.5 |
| 385 | Visalia-Porterville, CA Metropolitan Statistical Area | 9.9 |
| 386 | Merced, CA Metropolitan Statistical Area | 10.2 |
| 387 | Yuma, AZ Metropolitan Statistical Area | 16.3 |
| 388 | El Centro, CA Metropolitan Statistical Area | 19.2 |
Note: All data sources, methodologies, and historical data series available at CenterforJobs.org.