Beacon Economics

August 15, 2025

Beacon Employment Report | California

Presented by Beacon Economics

Copyright © Beacon Economics LLC

ICE Raid Effects Not Yet Visible In California Labor Market Data

State Gains Jobs in July, But June Numbers Revised Down

15,000

Monthly Job Increase

California’s total nonfarm employment expanded in July, growing to a seasonally adjusted 18,022,700, an increase of 15,000 positions over the month.

However, June’s job losses of 6,100 were revised to a 9,500 loss in the latest estimate. This decline follows the downward revision to the nation’s employment numbers released by the U.S. Bureau of Labor Statistics two weeks ago. Prior to the revision, the state’s total nonfarm employment in June was estimated to have fallen to a seasonally adjusted 18,011,100.

California’s unemployment rate also increased to 5.5% in July, a 0.1 percentage-point expansion over the previous month. The state’s unemployment rate remains the second highest in the nation, behind only Washington D.C.

5.5%

Unemployment Rate

California’s labor supply grew by 10,600 in July, an indication that the recent ICE raids have not had an impact on the state’s labor force, although that could change in coming months. Since February 2020, the state’s labor force has grown by just 228,500 workers, a 1.1% increase.

“These are some of the first economic statistics we’re seeing since the ICE raids began in late May and some may be surprised, even disappointed, that there hasn’t been an obvious impact on the labor market,” said Christopher Thornberg, Founding Partner of Beacon Economics. “But remember, the nature of these surveys and the updating process means we aren’t likely to see actual effects until the 2025 payroll revisions are released at the start of 2026.”

10,600

Monthly Labor Supply Growth

Overall, California’s employment growth continues to underperform the nation. Since the start of the pandemic (February 2020), total nonfarm employment in the state has expanded by 2.0% compared to a 4.8% increase nationally. From July 2024 to July 2025, payroll jobs in California edged up by just 0.8%, trailing the 1.0% increase in the nation over the same period.

In terms of job sectors, the state’s labor market continues to be anchored by locally serving industries such as Health Care, Government, and Education.

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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.

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