Is California’s economy healthier than we think?

A dearth of economic data, thanks to last year’s federal government shutdown, makes reading the tea leaves of the business climate even trickier than usual.

California’s situation seemed wobbly throughout most of autumn, with numerous high-profile layoff and business closing announcements, shrinking pay raises, and challenges with bill payments. Did I mention a frozen housing market due to unfathomable unaffordability and stubborn inflation?

Additionally, the annual flurry of economic gurus’ 2026 forecasts offered little fuel for hope, compounding this sense of uncertainty.

But recently, there have been some upbeat nuggets. California consumer confidence surprisingly jumped in December. Statewide tax receipts surged.

And now, my trusty spreadsheet’s review of the delayed November state-by-state employment report from the U.S. Bureau of Labor Statistics shows California’s job market relatively resilient on a national scale.

These upbeat patterns could be short-lived blips or data that is later revised to reflect less positive trends.

But for now, we witness intriguing improvements. Especially in the all-important job market.

Big picture

Let’s start with a reminder that, despite all the complaints about how challenging it is to operate a business in the Golden State, California remains the nation’s No. 1 job market.

California had 18.8 million folks saying they’re employed in November, or 11% of the nation’s 165 million. California’s top two rivals are Texas, at 15.3 million, and Florida, at 10.7 million.

California also had the largest one-year increase in this employment measurement: Up 211,300 – or 31% of the nation’s 688,000 increase. Texas was No. 2 with an addition of 189,500, as Florida was No. 23, up 6,800.

There were 19 states with fewer employed people in the year, topped by Virginia, off by 69,100; Wisconsin, off by 68,500; and Michigan, off by 30,800.

California’s employment surge is nationally significant, even accounting for the state’s large size.

The Golden State’s 1.1% employment growth rate ranked 13th best among the states and was nearly triple the nation’s 0.4% expansion. Texas was No. 11 at 1.3% and Florida was No. 32 at 0.1%.

Tennessee had the fastest growth at 2.4%, followed by Nebraska, Arizona and Alaska at 2.2%. Among the 19 declines, Wisconsin was the largest, down 2.2%, Vermont was off 20%, and Illinois and Virginia dipped 1.6%.

Joblessness top

Yes, California’s unemployment rate was 5.5%. Only the District of Columbia was higher at 6.5%.

Please note that California has long ranked high in joblessness, due in part to its volatile yet successful entrepreneurial mindset. The state’s best unemployment ranking was 22nd lowest in the nation for August 1987.

November’s No. 3 was New Jersey at 5.4%, then came Nevada and Oregon at 5.2%. Texas and Florida tied for No. 20 at 4.2%.

The nation’s lowest jobless rate was in South Dakota at 2.1%, followed by Hawaii, North Dakota and Vermont at 2.6%.

But note that California’s unemployment rate remained flat over the year. That’s the 30th best result, topping the nation’s 0.2 percentage-point increase.

Since November 2024, unemployment rates have risen in 16 states. Delaware led with a 1.3-point jump, followed by the District of Columbia (1.2 points) and Maryland (1.1 points). Texas stayed flat, while Florida had the eighth-largest increase (0.7 points).

The biggest unemployment rate dips? Hawaii, off 0.8 percentage points in a year, and Indiana, Kentucky and Colorado, off 0.7 points.

Of course, the nation’s largest job market had the most unemployed residents.

California’s 1.1 million jobless in November accounted for 15% of the nation’s 7.5 million. Texas was No. 2 at 673,900, and Florida was No. 3 at 466,000.

Yet, California’s unemployment tally grew by only 3% over the year. That’s the 30th-best performance among the states and slightly below the nation’s 4% increase.

The largest jumps were in Delaware at 39%, Minnesota at 35%, and Maryland at 33%. Texas tied California, up 3%, while Florida was No. 7 at 21%. The largest drops were in Alabama and Indiana, off 17%, and Colorado, down 16%.

Conspiracy theories

Sadly, political perspectives increasingly shape interpretations of employment data.

Doubts have been cast on jobs data due to misinterpretations of the labor bureau’s routine reviews of its statistics and its admissions about the difficulty of getting answers to its employment surveys. The federal shutdown only made the bureau’s work harder – raising more scrutiny.

Additionally, the partisan bickering peaked when President Donald Trump fired the bureau’s data chief last year.

So think about the conspiracy thesis that the bureau is intentionally making Trump’s economy look bad.

If that’s true, would that conspiracy include making the nation’s biggest job market look better than expected – a state with politics that are wildly polar opposite of Trump’s?

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com