California Economy is showing signs of Slowing after Losing 1,400 Jobs in June
According to a report released last month by the state’s Employment Development Department, employers reduced their payrolls by 1,400 in June. The unemployment rate stayed flat at 4.7 percent, the lowest rate since November 2000. A net reduction of 1,400 jobs is slight compared with the state’s total employment of about 17 million non-agricultural workers. California’s economy seems healthy enough, on the surface at least, and the jobless rate is rock bottom with wages growing much faster here than in the rest of the country. Chris Thornberg, co-founder of Los Angeles-based consulting firm Beacon Economics, stated:
These numbers are problematic, I think this is a wakeup call for everybody. I have to assume this is housing. Where do you put bodies? We don’t have houses. The state has run out of labor supply.
Most sectors in the state have either lost jobs in the first half of the year or are growing more slowly than they had been. Businesses are having a hard time finding applicants to fill open jobs, because rank-and-file workers can’t afford to live in California. Statewide, growth was hampered by five industries that reported job losses over the month, including manufacturing and trade, transportation and utilities. The worst performers in June were the government sector and information, which combined to shed 16,900 jobs. The trouble for California is that the slowdown appears to be touching almost every corner of the economy. A sign that businesses need workers is the fact that wages have increased by nearly 4 percent year-over-year in the state, according to data from the Bureau of Labor Statistics. There needs to be more done to attract more workers into the state and have an affordable place for them to live in order for the economy to continue growing in California.