Jobs (from the LA Times): SoCal sees gains as jobs picture improves in state-California keeps pace with nation in growth in June. But its 5.2% unemployment rate is tied for highest in U.S. By Don Lee
California’s unemployment rate held steady last month and the overall jobs picture looked considerably brighter than earlier this year, according to new government data released Friday.
Still, at 5.2%, the state’s jobless rate is tied with Nevada’s for the highest in the country; the national unemployment figure averaged 4.1% last month. But with 22,500 jobs added over the month, California is on pace with the rest of the nation.
And the number of unemployed people in the state dropped for the third straight month in June, falling below 1 million for the first time this year, according to seasonally adjusted data from the state’s Employment Development Department.
Significantly, some key economic engines, especially in Southern California, saw notable gains or improvement.
Transportation and warehousing employers statewide added almost 7,000 jobs last month. In doing so, that sector posted the first year-over-year increase in payroll growth since January 2023.
“It’s a good sign for the Inland Empire,” said Manfred Keil, an economics professor at Claremont McKenna College in Claremont, referring to the large number of warehouses and distribution centers that blanket parts of the counties east of Los Angeles.
He noted that the ports of L.A. and Long Beach have been busier this year, in part because of the diversion of cargo to the West Coast from the drought-stricken Panama Canal. That’s provided a lift to the region’s logistics industry , which Keil said has been coming back after a long period of pandemic-related ups and downs.
Southern California also saw a glimmer of hope in the latest jobs data for the film industry.
Employment in the motion picture and sound recording industries rose by 3,000 jobs last month, to 121,200 statewide. While that number isn’t adjusted for seasonal variations, the data in recent months suggest employment may be improving after sharp declines over much of the last two years amid the industry’s labor strikes, streaming wars and other challenges.
Overall, California’s job growth in June was led by the combined trade and transportation sector, government and information, which includes jobs in entertainment, according to the EDD.
Healthcare and social assistance, which have long been the strongest job creators in the state and nation, took a bit of a pause in June.
Payrolls at hotels and restaurants, as well as the entire grouping of leisure and hospitality businesses, were flat.
And there were outright losses in the state’s construction and manufacturing industries, which have been cutting jobs for most of the year.
In addition, tech sector employment remains lackluster.
Statewide, payrolls at computer systems and design firms, for example, were down in June on a year-over-over basis for the 16th straight month. And the recent announcement by Elon Musk that he plans to relocate SpaceX and X to Texas won’t help.
If he follows through with it, Musk’s move would complete “the hollowing out of the once vibrant tech hub in the mid-Market area of San Francisco,” said Michael Bernick, an employment attorney at Duane Morris in San Francisco. “X’s exit completes the exodus started by Uber in 2019, followed by Block (formerly Square) in 2022 and Reddit in 2023,” he said.
For all industries, the number of payroll jobs in California rose 224,000 in June, or 1.3%, from a year ago. That compares with a growth rate of 1.7% for the nation as
From CalMatters and PasadenaNOW): California’s ‘Weak’ Job Market Propped Up by Public Money as Private Sector Sheds Jobs
BY LEVI SUMAGAYSAY, CALMATTERS
Gains in public-sector and other jobs largely supported by public money have cloaked a dismal California labor market, which has seen a big decline of private-industry jobs since their post-pandemic peak, a new analysis shows.
The state Legislative Analyst’s Office looked at employment data from the U.S. Bureau of Labor Statistics through April, and concluded that private-sector industries in California have lost a total of 340,000 jobs since reaching their peak a couple of years ago.
The tech and finance industries led those losses. Jobs in the information sector — whose major employers include household names such as Google, Apple, Facebook and Disney — have declined 16% since their peak. There were more than 531,000 such jobs in July 2022, but 98,000 of those have gone away. Employment in the financial sector peaked at 500,000 jobs in December 2021, but it has lost 43,000 jobs, or 8%, since then.
Three other industries each saw a 3% drop in jobs since their peaks: business services, manufacturing, and transportation and warehousing. California has a 5.2% unemployment rate, the highest in the nation for the past four months.
Meanwhile, the health care and social-service industries have gained 240,000 jobs since September 2022, said Chas Alamo, principal fiscal and policy analyst for the Legislative Analyst’s Office, on Monday. Alamo said this industry includes private employers such as dentists, child care providers, vocational-rehabilitation centers and more, but is tightly linked to government spending, so his analysis groups these jobs with public-sector jobs, which have grown by 120,000 over the same period. His analysis was based on 12.5 million jobs in the private sector as of April, and a total of 5.5 million jobs about evenly split between the public and publicly supported sectors.
“The jobs picture since late 2022 has been weak,” Alamo told CalMatters, adding that state monthly jobs numbers should be “viewed with caution” because early revisions show the state did not actually add jobs last year, despite what monthly jobs reports said. Monthly jobs reports are based on surveys of businesses; revisions by federal agencies are based on states’ unemployment insurance data.
California is heavily dependent on revenue from personal income taxes, so the type of jobs that it loses or gains is important.
Brooke Armour, president of the California Center for Jobs and the Economy, said “all job growth is good.” But she added that “we’re losing high-wage jobs that help fund the (state) budget. We’re gaining hospitality and service jobs, which are low-wage jobs. We’ve hollowed out the middle-class jobs.”
The center is the information arm of the California Business Roundtable, an advocacy group that includes top executives of the state’s major employers. The group’s most recent analysis of employment data echoes Alamo’s assessment of the state’s job market. Though the center’s report mentions the group’s recurring complaints about the high costs of doing business in the state, it chalks up tech’s significant job losses mostly to the industry’s pandemic hiring sprees.
“What we’re looking at in tech jobs is a correction,” Armour said.
The center’s report said tech companies continue to prefer to remain in the tech hubs of Silicon Valley and the Bay Area. That is also important to the state’s coffers, which are becoming increasingly dependent on the stock-market performance of the tech industry.
“But while those tech companies are still here, are they growing here or are they growing elsewhere?” Armour asked. “We see a lot of them making investments outside California.”
As for whether the state’s sizable budget deficit could affect the job growth in public-sector jobs, Alamo of the Legislative Analyst’s Office said the public-sector industry also includes jobs supported by the federal government. And he said jobs in the health care and social-services industries are likely to continue to grow “despite state-budget challenges.”
CalMatters.org is a nonprofit, nonpartisan media venture explaining California policies and politics.
Inflation and Interest Rates (from the Financial Times): US inflation falls to 3% in June-US inflation fell more than expected to 3 per cent in June in an encouraging sign for the Federal Reserve as it debates cutting interest rates from their 23-year high.
From the New York Times: Inflation Cooled Further in June, Welcome News for the Fed and Consumers-Consumer Price Index inflation was 3 percent yearly in June and fell month-to-month, a sharper slowdown than expected and a relief for the White House.
The Consumer Price Index climbed at a moderate pace in June compared with a year earlier and fell on a monthly basis, welcome news for Federal Reserve officials who are watching for further evidence that they have wrestled rapid inflation under control.
Overall inflation was 3 percent in June on a yearly basis, down from 3.3 percent in May, and softer than the 3.1 percent that economists had forecast in a Bloomberg survey.
After stripping out food and fuel prices for a sense of the underlying trend, the “core” price index climbed 3.3 percent compared to year earlier, down from the previous report. And compared to the previous month, prices dropped 0.1 percent, while the core index ticked up only slightly.
In all, the very cool inflation data provided clear evidence that inflation is slowing meaningfully, exactly the kind of progress that Fed officials have been hoping to see as they contemplate when to begin cutting interest rates. The central bank has held borrowing costs at 5.3 percent for the past year, a relatively high setting that is meant to cool the economy by weighing down demand for big purchases that require loans, like houses and cars.
From the New York Times: Powell Welcomes Cooling Inflation but Wants ‘More Good Data’ Before Rate Cut.
Jerome H. Powell, the chair of the Federal Reserve, delivered optimistic remarks to Senators as inflation and the job market slow gently.
Jerome H. Powell, the chair of the Federal Reserve, indicated on Tuesday that recent inflation data had given the central bank more confidence that price increases were returning to normal, and that continued progress along these lines would help to pave the way toward a central bank rate cut.
He added that data earlier this year failed to provide such confidence, but that recent inflation readings “have shown some modest further progress, and more good data would strengthen our confidence that inflation is moving sustainably toward 2 percent.”
Mr. Powell delivered the remarks on Tuesday in an appearance before the Senate Banking Committee. While Mr. Powell avoided zeroing in on a specific month for when the Fed might begin to cut interest rates, he also did little to push back on growing expectations that a reduction could come in September. Fed officials meet in late July, but few economists expect a move that early.
Mr. Powell said he was “not going to be sending any signals about the timing of any future actions” in response to a lawmaker question about when rate cuts might come.
The chair’s congressional testimony came at a delicate moment for the central bank. Fed officials are trying to figure out when to begin cutting interest rates, which they have held at the highest rate in decades for roughly a year now. But as they weigh that choice, they must strike a careful balance: They want to keep borrowing costs high long enough to cool the economy and fully stamp out rapid inflation, but they also want to avoid overdoing it, which could crash the economy too much and cause a recession.
COVID (from the LA Times): COVID illness is worse than ever, some say-FLiRT variants continue to spread, bringing misery to those infected. By Rong-Gong Lin II
COVID-19 cases and hospitalizations are rising in Los Angeles County — and some of those recently reinfected are finding their latest bout to be the worst one yet.
There are no signs that the latest coronavirus variants are producing more severe illness, either nationally or in California. But some doctors say this COVID rise challenges a long-held myth: Although reinfections are often milder than a first brush with the disease, they can cause severe illness . Even some who don’t visit an emergency room or need to be hospitalized describe agonizing symptoms.
This underscores the need for caution during summer travel and activities, even though the risk remains relatively mild.
It’s difficult to quantify how many are experiencing more acute symptoms now compared with previous infections.
While the prevalence of long COVID appears to be declining , doctors note that there is risk of developing the syndrome with each infection. A report published last summer by the U.S. Centers for Disease Control and Prevention said the prevalence of long COVID among U.S. adults was 7.5% in early June 2022 but had fallen to 6% as of mid-June 2023 — still a notable share of the population.
For the week ending Saturday, an estimated 70.5% of COVID specimens nationwide were of the FLiRT subvariants — officially known as KP.3, KP.2 and KP.1.1 — up from 54.9% a month earlier. Another closely related subvariant, LB.1, is estimated to comprise 14.9% of specimens, up from 10% a month earlier.
A report published in February by the CDC found that the 2023–24 COVID vaccine provided about 54% increased protection against symptomatic illness compared with not getting the shot. Vaccine effectiveness against symptomatic infection is higher in the first few months after getting the updated shot.
The vaccines continue to provide protection against hospitalization and death.
In L.A. County, COVID cases and hospitalizations continue to rise. For the week ending June 30, there were an average of 229 cases a day, up from 106 a month earlier. For the week ending June 29, there were an average of 197 coronavirus-infected people in hospitals per day, up from 117 a month earlier.
The rate at which coronavirus tests are coming back with positive results continues to climb across the state.
For the week ending July 1, 10.6% of tests came back positive, up from 4.1% a month earlier. Last summer’s positive test rate peaked at 13.1%, toward the end of August.
In California, there has been relatively low uptake of the updated vaccine. Since it became available in September, 36.7% of Californians age 65 and up have received at least one dose, as have 18.5% of 50- to 64-year-olds and 10% of those up to age 49.
Those who haven’t gotten a vaccine in the last year “should think about getting it, especially if you’re older and immune compromised,” Chin-Hong said.
There continue to be hundreds of COVID deaths reported nationally every week, with seniors and immune-compromised people most at risk.
Getting the 2023-24 vaccine now will allow you to get the updated version that is on track for availability this fall. The CDC will recommend that everyone 6 months and older get the 2024-25 version. A good time to get it is in October, Chin-Hong said.
Chin-Hong said that even healthcare workers need to be reminded of proper COVID infection control protocols, like the importance of testing when sick and reporting illness to one’s employer.
China (from the Financial Times): China’s economic growth slowed and missed forecasts in the second quarter-China’s economy grew 4.7 per cent year on year in the second quarter, official data showed on Monday. Gross domestic product, which added 5.3 per cent in the first quarter on the year before, had been expected to rise 5.1 per cent based on economists polled by Reuters.
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