Same old, same old

Each week, we check the latest California new weekly claims for unemployment insurance as an index of labor market and economic conditions. Each week, it turns out the claims data remain stuck well above the level before the pandemic hit. The official unemployment rate for California from the separate household survey last month was 6.5% vs. 4% nationally. Back before the pandemic, California had a 4-ish unemployment rate and the national as a whole was around 3.5%. So the gap is wider now and while the U.S. has largely recovered by that measure, California hasn't. (And when you go back to the new weekly unemployment insurance claims data, at the U.S. level we seem back to roughly pre-pandemic levels, too.)

In short, something has happened in California. Despite the national news - and to some extent the state news - about labor shortages, folks keep losing jobs in California at above-normal rates. Since we seem to have stabilized, it appears that after an interval reflected in the unemployment rate numbers, they get new jobs. Some kind of excessive churn and longer durations of the period between jobs then produces the higher state unemployment rate.

As always, the latest claims data are at https://www.dol.gov/ui/data.pdf.

Nonfarm payroll employment data for California also tell a story of incomplete recovery:

As can be seen above in this chart from the U.S. Bureau of Labor Statistics, the employment totals are well below what they were in early 2020 before the pandemic. The household survey - which includes people employed as "independent contractors," farm-sector workers, and family workers - shows the same thing.