California experienced a mini-jolt in the increasing number of individuals entering or re-entering the labor force to look for a job, while in Nevada those residents are doing so at a much slower pace. That’s according to the latest state-level seasonally adjusted employment numbers released this week.
The rising labor force trend in California in early 2023 compared to the latter months of 2022 could be an indicator of entrants returning into the labor market after deciding not to be employed — or choosing to only work part-time — for so many months coming out of the COVID-19 pandemic. For many consumers and workers going into 2023, the cost of living (inflation) is front and center as they try to manage their money appropriately.
The following are the latest year-over-year and month-over January 2023 trends published this week by the California Employment Development Department (EDD) and the Nevada Employment Training and Rehabilitation Department (DETR):
California’s January 2023 Employment Numbers
The California report shows the state’s unemployment rate rose to 4.2 percent in January 2023 (from a “readjusted” 4.1 percent in December 2022). For context, the state’s unemployment rate hit 16.1 percent at one point during the COVID-19 pandemic in 2020.
California employers added 96,700 non-farm monthly payroll jobs in January 2023:
Nevada’s January 2023 Employment Numbers
The Nevada report shows employment in the state was up 4,900 jobs in January 2023 (month-over change) and 75,7000 jobs from a year ago (a 6 percent annual increase).
Total non-farm employment (payroll and independent-contract jobs combined) hit a record high of more than 1.53 million individuals. When it comes to payroll employment specifically, June 2022 was the first month Nevada’s job market finally closed the gap inflicted since the COVID-19 recession in 2020.
Nevada’s January 2023 unemployment rate stood at 5.5 percent (from a “readjusted” and unchanged 5.5 percent in December), which is up from 3.7 percent in February of 2020 (pre-pandemic economy). For context, the state’s unemployment rate hit 28.2 percent at one point during the COVID-19 pandemic in 2020.
At the local/regional level, Nevada employers added the following jobs in January 2023:
Ongoing Labor Market Perspective
These California and Nevada job market recoveries don’t account for lost ground and opportunity costs coming out of the COVID-19 pandemic.
Specifically in California, the state’s labor force — the pool of individuals willing and able to work — shrunk drastically due to public health restrictions and concerns, policy and employer decisions, the volatile business environment, federal and state financial relief, and worker fluidity in a tight labor market.
Essentially, both California and Nevada job markets may have been even more robust by January 2023 if COVID-19 never impacted the economy and policy decisions, assuming no other negative financial or economic events transpired.