The California economy careens into 2016. November state employment numbers will be released this Friday, and should follow the job gain trends of the past few years.
In the most recent job numbers through October 2015, California had gained over 2.1 million payroll jobs since February 2010, 463,000 payroll jobs in the year from October 2014 through October 2015, and 41,200 in the month from September to October. The chart above (click to enlarge) prepared earlier this year by Mr. Brandon Hooker of the Employment Development Department (EDD), provides a good overview of the job losses and job gains for California since July 2007. Our state unemployment also has steadily declined over the past six years, down to 5.8% in October.
Yet, if you just read the op-ed and internet commentary in California you wouldn’t know any of the positive news. These articles continue to be filled with discussions of middle class anxiety, a declining middle of jobs, wage inequality, and technology eliminating most jobs.
Why all of this handwringing as we enter 2016?
In part, as we have discussed at Fox & Hounds over the past six year, it is because the unemployment rate and even payroll job numbers do less and less reflect the true state of the labor market in California. Among other things, the declining labor force participation rate (at its lowest level since the late 1970s in California) skews the unemployment rate, and the payroll job numbers do not indicate the growing number of part-time payroll jobs and time-limited payroll jobs.
But there are two other dynamics at play in this handwringing that are important to note going forward. First, there is the role of op-ed masters, most notably UC Berkeley Professor Robert Reich, who have assigned themselves the role of protectors of the poor and middle class, and write repeatedly about how the poor and middle class are being ignored. Never mind that Reich and others never help poor Californians or unemployed Californians on an individual basis—while at the same time charging for themselves five-figure fees to give speeches about inequality. They keep the narrative going about how bad things are.
Second, there is the fact that no matter how low the unemployment rate goes or how many jobs are created, in general good segments of the California policy class will never be satisfied. Unemployment was at 6.2% in December 1979 in California, and there was outrage that this was way too high and that the recently-enacted Humphrey-Hawkins Full Employment Act of 1978 was being ignored. Later in December 1989 unemployment in California was at 5.1% and it was at this same 5.1% in December 1999, and in both periods the unemployment, like today, was described as out of control and unacceptable.
This second dynamic, though, can be a valuable one for our state, constantly challenging complacency. Serious researchers, who are frequent critics, such as the California Budget Project and the Labor Centers at UC Berkeley and UCLA, help keep all of us in the workforce community on our feet. Let them continue their voices into 2016.