California’s labor supply fell by -10,200 in the latest numbers and since February 2020, has contracted by -196,300 workers, a -1.0% decline. This is primarily being driven by the housing shortage, and also by the retirement of aging workers.

California’s unemployment rate held steady at 5.4% in November, unchanged from the previous month, but still among the highest in the nation. The state’s unemployment rate has increased over the last year, notably for younger workers. However, initial claims for unemployment insurance have remained stable over this period, one of the reasons Beacon Economics has linked the rise in unemployment to California’s minimum wage increases.

Also, affecting the job numbers, the two surveys that make up the monthly estimates have diverged in recent survey. The divergence between the payroll and household surveys suggests there years. Total nonfarm employment is up 1.8% over the last two years according to the payroll survey, while household employment is down 0.1% over the same period according to the household may be a downward revision in payroll employment when the annual revision of employment figures occurs in March.