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Straight Talk
California's August Job Gains Are Another Win

From our company chief economist, Selma Hepp

California's August Job Gains Are Another Win 

  • August was another solid month for job additions in California, with employers creating 44,800 positions. In addition, California’s unemployment rate remained at 4.2 percent, maintaining a historic low for the fifth consecutive month, according to the latest numbers from the state Employment Development Department. 
  • The August increase was more than two-and-a-half times the gain seen over the last two years, confirming 2018's strong labor market. In the last year, California has added a total of 348,900 jobs. 
  • Considering the robust job increases recorded over the summer, California's 2.1 percent employment growth is again trending above the national rate of 1.6 percent. 
  • While job additions were solid, the state's unemployment rate was unchanged, as labor-force growth continued to hold back employers. Over the last year, the state's labor force has shrunk by 0.4 percent. With notable labor shortages, California employers may be pressed to move operations elsewhere in search of more workers.
  • In August, eight sectors added jobs, led by an 18,800 increase in the educational and health services sector, followed by a 7,700 gain in professional and business services and a 6,100 increase in government jobs. The construction industry rebounded from last month’s losses, creating 5,200 jobs. The manufacturing and mining and logging sectors reported declines. 
  • Over the past year, nine of California's 11 major industries have added jobs. The top three gaining industries were educational and health services, with about one-fifth of total jobs added, followed by professional and business services and leisure and hospitality. In total, those three sectors created about 60 percent of all jobs. While the mining industry is back in positive territory on an annual basis, the largest losses were in other services, down by 1,100 jobs from last year. 
  • All California metropolitan areas again saw employment rise over the past three months.
  • San Francisco and San Mateo counties added 2,800 jobs from July, and the unemployment rate dropped to 2.3 percent in August. From July, public-educational services saw the largest growth in jobs as schools returned to session. The finance and insurance industries, along with real estate and rental and leasing, were the second-largest contributors to August's job growth. After many months of employment gains, the leisure and hospitality sector saw significant payroll losses, along with other services. Over the year, the professional and business services sector was the fastest-growing industry, with 10,000 jobs added, though the information sector had another strong month of 4,100 job additions. The other industries that created jobs include educational and health services -- particularly jobs in health care and social assistance. The other services and trade, transportation, and utilities industries posted employment losses. 
  • Santa Clara and San Benito counties added 3,200 jobs in August, with most coming in public- and private-education services. The professional and business services sector also posted gains -- mostly in administrative and support services. The finance and insurance industries reported losses. Over the year, the two counties created 33,500 jobs, with education and health services leading the pack. The manufacturing, professional and business services, and information sectors reported solid annual increases. Other industries with gains of more than 1,000 jobs include construction, government, and financial activities. 
  • Alameda and Contra Costa counties added 4,800 jobs, with most coming from the trade, transportation, and utilities sector. The health care and social assistance, other services, financial activities, and professional and business services industries posted gains, while manufacturing and construction reported losses. Over the year, the two job-gain leaders have been professional and business services and trade, transportation, and utilities, though other major industries have posted substantial additions as well. 
  • Marin County's unemployment rate dipped to 2.4 percent in August, with 1,000 jobs added from July and 3,200 new jobs from the same time last year. On an annual basis, most jobs gained in Marin County were in the educational and health services sector, followed by construction and trade, transportation, and utilities. 
  • Sonoma County's unemployment rate declined to 2.7 percent, and the region posted a gain of 2,500 jobs since July and 4,700 year over year. In August, most of the gain was in the government sector, followed by manufacturing. Over the year, the educational and health services industry created twice as many jobs as manufacturing, the second-largest gaining sector. The professional and business services, financial activities, and government industries reported the biggest losses. 
  • Napa County's unemployment rate decreased to 2.8 percent in August, with 300 jobs created from July and 100 additions year over year. Annual gains were driven by the leisure and hospitality sector, while the losses stemmed from manufacturing and trade, transportation, and utilities. 
  • Los Angeles County added 23,500 jobs in August, with the unemployment rate unchanged at 4.5 percent. In August, the professional and business services sector led gains in all industries, with administrative and support and waste services accounting for 85 percent of the increase. Health care and social services reported strong growth, but educational services showed losses. The motion-picture and sound-recording industries drove most of the gain in the information sector. The accommodation and food services and arts, entertainment, and recreation industries reported losses. Over the year, Los Angeles County added a total of 62,000 jobs, a 1.4 percent gain, but still lags the Bay Area in employment growth rate and gains in higher-paying industries. The leisure and hospitality industry continues to lead the annual employment gains.
  • The second-largest increase in Los Angeles County was in the health care and social-assistance sector, followed by administrative and support; waste services; and professional, scientific, and technical services. The information industry also posted a solid gain, with more than 70 percent of new jobs coming from the motion-picture and sound-recording sector. The government sector posted losses, with most of the reductions coming from government education. 


Selma Hepp is the Chief Economist and Vice President of Business Intelligence for Pacific Union International. Her previous positions include Chief Economist at Trulia, senior economist for the California Association of Realtors, and economist and manager of public policy and homeownership at the National Association of Realtors. She holds a Master of Arts in Economics from the State University of New York (SUNY), Buffalo, and a Ph.D. in Urban and Regional Planning and Design from the University of Maryland.

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