Southern California’s jobs picture is improving; glimmer of hope seen in Hollywood employment

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 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. “The adjustment is over,” he said.

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 a whole, according to the U.S. Bureau of Labor Statistics.