Beacon Employment Report | California

The yearly benchmark revision of the state’s employment numbers reveal that California’s labor market performed better in 2025 than originally estimated.

The California EDD’s annual benchmark revision shows that there were 41,300 more jobs in the state than reported in December 2025. More importantly, employment growth from December 2024 to December 2025 was revised from a -0.1% decline to a 0.3% increase. However, the state’s job growth from December 2023 to December 2024 was revised from 0.9% to 0.5%.

These payroll revisions might have been even stronger if not for the downward revision to California’s labor force. Between December 2024 and December 2025, just 117,500 workers joined the work force; the original estimate was 241,700. This translates into labor force growth of 0.6% instead of the estimated 1.2%.

As Beacon Economics has said many times before, a housing shortage, and more recently, aggressive immigration enforcement, limit the state’s ability to grow its labor force. Recent figures from the U.S. Census Bureau shows immigration to the United States declined significantly in 2025.

In slightly better news, 2024’s labor force numbers ticked up following the revision, with growth from December 2023 to December 2024 revised to 0.9% from 0.6%.

California’s Industries

At the industry level, the benchmark revision was largely positive, with growth rates in most sectors revised upwards. The largest upward revisions to year-over-year growth rates were in the following sectors:

Professional, Scientific, and Technical Services (revised from -3.0% to +0.9%), Education (revised from +0.6% to +2.9%), Real Estate (revised from -2.9% to -0.9%), Finance and Insurance (revised from -1.9% to -0.1%), Transportation, Warehousing, and Utilities (revised from -2.6% to -0.7%), Administrative Support (revised from -2.2% to -0.8%), Manufacturing (revised from -2.6% to -1.7%), Information (revised from -2.5% to -1.7%), Wholesale Trade (revised from -1.3% to +0.9%), Management (revised from -1.2% to -0.8%), and Health Care (revised from +5.1% to +5.4%).

The biggest downward revisions in year-over-year growth occurred in Mining and Logging (revised from +1.1% to -2.1%), Government (revised from +0.8% to -1.9% revised), Construction (revised from -2.2% to -2.6%), and Other Services (revised from 0.4% to 0%).

California’s Regions

The benchmark revision was also largely positive at the regional level, with growth rates revised up in most parts of California, with the Central Valley and the San Francisco Bay Area leading the way. The largest upward revisions were in the following sectors:

Merced (revised from 1.3% to 4.5%), Hanford (revised from -1.4% to 1.4%), Redding (revised from 0.1% to 2.8%), Vallejo (revised from -1.3 % to 1.0%), Visalia (revised from -0.4% to 1.5%), San Jose (revised from -0.3% to 1.5%), Modesto (revised from -0.5% to 0.8%), Stockton (revised from 1.1% to 2.3%), Sacramento (revised from -0.4% to 0.8%), Yuba (revised from 1.9% to 2.9%), San Francisco (MD) (revised from -0.6% to 0.5%), the East Bay (revised from -0.7% to 0.2%), San Rafael (MD) (revised from -0.6% to 0.3%), Salinas (revised from 0.5% to 1.3%), Bakersfield (revised from 0.8% to 1.5%) the Inland Empire (revised from 0% to 0.6%), Santa Rosa (revised from 0.1% to 0.4%), Los Angeles (MD) (revised from 0.2% to 0.1%), and Ventura (revised from -0.3% to 0%).

Downward revisions occurred in Chico (revised from 0.6% to -1.0%), San Luis Obispo (revised from -0.3% to -0.9%), Orange County (MD) (revised from 0.1% to -0.4%), El Centro (revised from 1.2% to 0.8%), and Santa Barbara (revised from 0.2% to -0.1%).