Mirroring California – Ventura County Continues its Slow Paced Employment Recovery



Mirroring California – Ventura County Continues its Slow Paced Employment Recovery
By Bruce Stenslie
Edited by Gary Wartik
March 7, 2014

Introduction:

Vision Economics operates on a statewide basis in both the public and private sector.  However, we all have a home, and Ventura County, along the beautiful central coast is home to our team.  One of the outstanding services provided to the local private sector is through the Economic Development Collaborative Ventura County (“EDV-VC”), a public-private partnership formed in 1996 to stimulate and sustain economic vitality in the region.  There are a total of 41EDC’s throughout California.

Bruce Stenslie is the very accomplished professional who has served as president and CEO of the EDV-VC since 2007.  He is also chairman of the board of the California Local Economic Development Association headquartered in Sacramento (“CalEd”).  Mr. Stenslie writes a monthly report on the subject of local employment.  The current article below, summarizing data available through December 31, 2013, reflects the somewhat uneven recovery Ventura County has endured since the end of the Great Recession, one shared with our good neighbors next door in Santa Barbara County.  It is a picture that has been repeated throughout much of California during the last several years, although official unemployment levels have continued to decrease, albeit rather slowly.

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The December 2013 Labor Market Information Report

The California Labor Market Information Division released its January 2014 report, a few weeks later than usual, delayed to incorporate revised historical labor force and industry data. At first look the numbers look bad, though taken in historical context — that is, in context of the rolling ten year average for changes, December to January — we’re tracking almost exactly to our annual pattern of post-holiday scale-back. Our unemployment rate is up, by .5%, from 7.0% to 7.5%, and jobs are down, with a loss of 6,000 private sector jobs. The ten year averages for those two measures, December to January, are a .44% increase in unemployment and private sector job loss averaging 6,260, so this appears to have been mostly just an average January.  For the detail, see www.calmis.ca.gov/file/lfmonth/vent$pds.pdf.

Looking more closely at the data shows some predictable numbers, some that are cause for enduring concern, and at least one that doesn’t appear to make any sense.

The predictable: Retail trade is down this month by 2,400 jobs, representing the usual layoffs after the holidays. Looking year-over-year, the sector is up by 400 jobs, or up by 1%, and is one of just a few sectors actually ahead of where we were six years ago, prior to the recession. That noted, aside from the holiday hiring, the sector has largely leveled off and we’re not expecting significant growth in the near term.

The enduring concern: The Construction industry continues to languish, though it is up by 100 jobs in January. The concern is that we’re still nearly 9,000 jobs below our pre-recession high, or some 40% behind. There’s not a lot of construction work on the horizon. Until there is more building, we’re likely to stay significantly behind in nearly every category of regional economic performance. There’s just not enough work in the other sectors to make up for the losses in Construction.

The surprising: While our annual January decline in jobs is right in alignment with the historical norm, the total distribution of job losses is notably odd.  Rather than the more common general distribution of January losses across all sectors, this year’s drop – along with Retail Trade – is concentrated in Educational and Health Services, by a loss of 1,700 jobs, against a base of about 40,000 jobs. The monthly data for Ventura County doesn’t distinguish sub-sectors here, but the “Education” piece is not the public school system, so this primarily looks like a drop in Health Services.  We’re not aware of any layoffs to generate this scale, and the general trend, in Ventura County and across the nation, is for an increasing number of jobs in Health Care.  It may be that the annual recalibration of data is behind this drop, but whatever the case, we’ll keep our eye on it moving forward.

Only one other data point begs for attention. Specifically, it is alarming that year-over-year we’ve had a decline of 6,900 workers in our local labor force. This too may be influenced by the annual recalibration, but even with that possibility, that’s a big number. Our population continues to grow, we’re creating some new job growth, but we have significantly fewer people in the total labor pool, or the combined total of people working or actively looking for work.  As people drop out of the labor force that contributes to a loss of the region’s human capital, essential fuel for economic output.

Finally, for the comparison of unemployment rates across California’s 58 counties, we’re unchanged again for the third straight month, at 15th position. Just glancing at changes statewide, it appears that January was a bit more volatile for several regions. Looking to Santa Barbara County, for example, we note that that area has fallen to 13th place, a significantly lower position than they’ve enjoyed for most of the last several years. Whether that may represent a chronic or momentary problem isn’t yet evident. For the comparative data, see www.calmis.ca.gov/file/lfmonth/1401pcou.pdf.

For additional information, please contact us at Vision Economics at 805-987-7322, or at gw@visioneconomics.net, or Mr. Stenslie at 805-384-1800, x 24, bruce.stenslie@edc-vc.com.

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