California job creation dropped 81% after pandemic
California job creation dropped 81% after pandemic
California’s economy is suffering an extended pandemic hangover, as statewide job creation cooled 81% after coronavirus upended the business climate.
My trusty spreadsheet, looking at state jobs data through February, found that California employers added 340,000 jobs in the last five years to push total employment to 18 million. That was the fourth-largest increase among the 50 states in a 2020-2025 period that was marked by business gyrations linked to various attempts to limit a pandemic’s spread.
However, the number of jobs created during the pandemic era is far less than what Californians witnessed in the previous five years. The state added 1.82 million workers in the five years ending in February 2020, the No. 1 job growth among the states.
Compare these two five-year periods, and you see California bosses added 1.48 million fewer workers since we all learned what a coronavirus was. That’s an 81% decline in the Golden State’s job creation pace.
By the way, a hiring slowdown was not just a California thing.
U.S. employers added 6.4 million workers in the last five years, down from 11 million in 2015-20. That’s a decline of 4.6 million or 42%.
And 36 of the states saw employment gains shrink once the pandemic began. California’s big economic rivals? Texas had a 140,000 increase in job growth — best in the nation — but Florida job creation shrank by 147,000, the 11th largest decline.
Contemplate California’s employment by industry during the past 10 years, and see that there is little uniformity in slower job creation.
There’s one big winner among 20 slices of the California job market: Health and social care. The statewide population is aging, so more medical and social services are needed.
It’s the kind of demand boosting this slice of employment by 481,000 workers during the last five years to a workforce of 3 million. And that growth exceeded the 398,000 increase seen in the 2015-20 period. No other California industry prospered like this.
Four private industries continue to expand California staffing but at slower rates.
Logistics: Transportation and warehousing — plus utilities — had to cool because it was so hot, mid-pandemic. Added 111,900 jobs in the last five years to 847,100 vs. 190,100 gained in 2015-20.
Private education: It’s good business to offer trendy ways to learn. Added 35,900 workers in last five years to 428,200 vs. 48,300 gained in 2015-20.
Professional services: Demand dipped for financial, scientific and technical smarts — usually high-paying white-collar work. Employment expanded by 24,900 in the last five years to 1.4 million vs. 182,000 new jobs in 2015-20.
Fun: No matter the economy, consumers want arts, entertainment and recreation. That powered 17,000 new workers in 2020-25 to 355,300 — though that’s off from a 61,300 gain in 2015-20.
California public sector continued to expand staffing, but various budgetary pressures will likely end government job growth.
Local: Up 58,100 workers in the last five years to 1.9 million vs. 130,100 gained in 2015-20.
State: Grew 20,200 over the last five years to 561,600 vs. 36,100 added in 2015-20.
Federal: Added just 700 during the last five years to 252,200 vs. 8,300 growth in 2015-20.
Eight of California’s industries switched from job creation to staff cuts.
Hospitality: Yet to fully recover from the pandemic, especially tourism. Dropped 70,000 jobs in 2020-25 to 1.65 million vs. the 198,000 gain of the previous five years.
Financial activities: High interest rates crushed lending and property businesses after cheap money ballooned staffing. Cut 62,400 jobs during the last five years to 786,600 vs. 57,900 added in 2015-20.
Office staff: Challenges from remote work to corporate downsizing. Off 61,500 workers in 2020-25 to 1 million vs. gains of 107,900 during the previous five years.
Information: Hurt by the recent weaknesses in technology and Hollywood. Down 54,400 jobs in 2020-25 to 534,500 vs. the 107,600 growth of the previous five years.
Durable-goods factories: Making big-ticket items suffered like much of U.S. manufacturing. Lost 34,700 workers in 2020-25 to 779,000 vs. 19,700 gained in the previous five years.
Construction: Costlier mortgages muted what had been a building boom. Off 14,800 workers in the last five years to 895,000 vs. adding 201,600 in 2015-20.
Management: There were fewer bosses post-pandemic amid corporate belt-tightening. Dropped 8,300 positions in the last five years to 287,700 vs. 35,200 added in 2015-20.
Personal services: Soaring prices for getting stuff done led to a consumer pullback. Lost 2,500 jobs in the last five years to 591,600 vs. 54,700 gained in 2015-20.
And four California job niches remained in staff-cutting mode.
Retail: Blame the online shopping revolution. Off 40,100 workers during the last five years to 1.6 million following a 6,400 dip in 2015-20.
Wholesale trade: Business-to-business distribution suffered supply-chain headaches, then anemic demand. Off 29,400 jobs in 2020-25 to 658,000 after a dip of only 300 in the previous five years.
Non-durable goods factories: It’s financially rough to produce food or clothing in high-cost California. Off 27,900 workers in the last five years to 449,100 vs. a 4,000 drop in 2015-20.
Mining: California makes it tricky to search for oil or timber. Down 4,000 jobs in the last five years to 18,600 vs. a 5,600 dip in 2015-20.
Let’s eyeball all 10 years, noting numerous complaints about California’s unfriendly business climate.
Golden State employment grew by 2.16 million since 2015, topped only by Texas at 2.44 million. Florida was No. 3 at 2 million. No other states added 1 million or more.
And what about that decade of hiring on a percentage basis?
California jobs increased 14%, the 15th best among the states and ahead of the nation’s 12% growth. Texas was No. 6 at 21% and Florida, No. 4 at 25%.
Tops? Idaho at 32%, Utah at 30%, and Nevada at 26%.
Jonathan Lansner is business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
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