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Rebounding from the recession

In California and across the nation, job growth has been steadily improving over the past two years. In July, California hit a symbolic milestone by surpassing its previous peak number of jobs reached in 2007, before the housing bust and the Great Recession.

But in the meantime, the state’s population and available workforce have continued to grow. How does California compare to other states in recovering the jobs lost over the past seven years?

Not well, according to new research.

Uneven job recovery

Employment rate drop
-0.1
-9.2

Full data available here

Rather than looking at unemployment rates -- which don’t count discouraged job-seekers who have dropped out of the labor force -- a recent analysis by the Pew Charitable Trusts looked at how many 25- to 54-year-old people had jobs in each state in 2007 and during the past year.

The study focused on the prime working-age population, factoring out college students and potential retirees.

Over the past year, California ranked among the bottom 10 states in getting middle-aged people back to work.

And California remains behind the national average in digging out from the recession.

This year 73.6% of California’s prime working population had jobs, compared with 77.9% in 2007. The 4.4 percentage point gap is higher than the U.S. average (3.7 percentage points), and much higher than states like Texas (1.5 percentage points).

“That represents the weakness in the labor market,” said Barbara Rosewicz, a director of research with the Pew Charitable Trusts who focuses on state economic trends. “These are people sitting on the sidelines who are eager to be employed, if conditions could be improved.”

Other states savaged by the subprime mortgage meltdown, such as Nevada, Arizona and Florida, have even bigger employment gaps than California.

Employment declines by state, from 2007 to 2014

Smallest declines Largest employment declines -9.2 points -7.5 -5.8 -5.6 -5.5 -3.7 -0.1 -0.6 -0.9 -1.1 -1.1 Vermont Nebraska Minnesota Massachusetts Alaska New Mexico Nevada Idaho Florida Arizona U.S. average -4.4 California

California's job recovery

Employment rate drop
+0.8
+5.3

Full data available here

Across California, there has been wide variation in economic recovery.

The Times analyzed unemployment rates across the state in 2007 and over the past year to see which areas have rebounded the most.

Central Valley areas such as Visalia and Yuba still have unemployment rates more than 4 percentage points higher than in 2007, while unemployment rates in Silicon Valley and San Francisco are almost back at pre-recession levels.

More surprisingly, Los Angeles County’s unemployment rate over the past year is still 3.6 points higher than it was before the financial crisis – nearly the same margin as areas such as the Inland Empire and Stockton that were among the hardest hit by the housing bust.

California unemployment increases, 2007 to 2014

Smallest increase Largest increase in unemployment +5.3 percentage points +4.2 +4.1 +3.9 +3.6 +0.8 +1.2 +1.5 +1.5 +1.6 El Centro Yuba City Visalia-Porterville Hanford-Corcoran L.A. (includes Long Beach and Glendale) +2.6 State metro average Santa Ana (includes Anaheim and Irvine) Santa Rosa Napa San Jose San Francisco

The slower economic growth in Los Angeles County has to do with its size &ndash--the county is home to a quarter of the state’s population--and the diversity of its industries.

“There’s no major industry or sector that carries the overall economy,” said Lynn Reaser, an economics professor at Point Loma Nazarene University in San Diego. She said Los Angeles County has not had a similar boost from specialized industries such as technology in San Francisco, or biotech in San Diego.

No region in the state has completely closed the gap since 2007, but the booming Bay Area is close. In addition to San Francisco and San Jose, other areas with fast-improving unemployment rates are Orange County, Napa and San Luis Obispo.

Regions with the least improvement in unemployment include El Centro – which already had the state’s highest pre-recession jobless rate – Visalia, Hanford and Los Angeles.

Reporting: Chris Kirkham

Programming: Kyle Kim

Follow @c_kirkham and @kyleykim on Twitter.

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