March 28, 2025
Beacon Employment Report | California
Presented by Beacon Economics
Copyright © Beacon Economics LLC
CALIFORNIA LABOR MARKET CONTRACTS IN LATEST DATA
Unemployment Rate Holds Steady But Still One Of The Highest In The Nation
7,500
Monthly Job Decline
California’s labor market contracted in February. Total nonfarm employment in the state fell to a seasonally adjusted 18,003,500 in the latest numbers, a decrease of 7,500 positions.
California’s labor market remains stable but has been more tethered to locally serving industries such as Government, Education, and Health Care. January’s jobs gains were also revised down to a 21,400 decline in the latest numbers, a 21,400 decrease from the preliminary estimate.
5.4%
Unemployment Rate
“California’s export sectors are struggling,” said Justin Niakamal, Research Manager at Beacon Economics. “But these losses are being largely offset by gains in locally serving industries such as Health Care, which depend more on people and less on external factors.”
Overall, employment growth in California continues to trail the nation. Since February 2020 (the start of the pandemic), total nonfarm employment in the state has expanded by 1.9% compared to a 4.5% increase nationally. In addition, California increased payrolls by 0.4% from February 2024 to February 2025, trailing the 1.2% increase nationally over the same period.
2,600
Monthly Labor Supply Growth
California’s unemployment rate held steady at 5.4% in February, unchanged from the previous month and still among the highest in the nation. At 5.4% California is tied with Washington D.C. and Michigan; only Nevada has a higher unemployment rate.
California’s labor force grew by 2,600 in the latest numbers. The most recent annual revision revealed that California’s labor supply has been growing slowly. Since February 2020, the state’s labor force has expanded by just 78,600 workers, a 0.4% increase. The slower growth is being driven largely by the housing shortage and the retirement of aging workers.
The Beacon Employment Report | California is a unique analysis of California’s employment numbers and trends. Each month, we link our own econometric predictions to data released by the U.S. Bureau of Labor Statistics and the California Employment Development Department to identify important changes in employment across industries and regions. The Beacon Employment Report is also one of the few analyses that uses seasonally adjusted numbers, which are critical to revealing accurate trends and insights within data. The analysis is a sample of the kind of research available from Beacon Economics.
The contents of this report are based on information derived from carefully selected sources Beacon Economics believe are reasonable. We do not guarantee its accuracy or completeness and nothing presented here shall be construed to be a representation of such a guarantee.
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