SACRAMENTO, Calif. (AP) — California said Friday it has regained the 2.7 million jobs it lost at the start of the pandemic, a moment that would normally celebrate the end of a recession but instead It is tempered by signs of a shaky economy at a time of layoffs in the state’s historically strong tech industry.
The 56,700 jobs California employers added in October were enough to surpass the mark, led by strong gains in the state’s health care, professional services and leisure and hospitality industries. California has now had positive job growth for 13 consecutive months.
“The pandemic caused one of the largest job losses we have experienced in history,” said Sung Won Sohn, an economics professor at Loyola Marymount University who closely follows the California job market. “The recovery was strong enough to replace lost jobs and even more. For me, this is an important milestone.”
Despite the job gain, state officials have been warning of a possible economic downturn. Inflation remains stubbornly high, making everything more expensive. The Federal Reserve raised a key interest rate, causing a chilling effect on the rest of the economy. Some of Silicon Valley’s best-known companies—Facebook, Lyft, Cisco, Salesforce—have announced layoffs. And California government officials announced Wednesday that they expect a budget deficit of $25 billion for next year.
“California has already recovered all the jobs lost to the recession caused by the pandemic, but we know this is not the goal,” California Governor Gavin Newsom said in a statement.
Those conflicting messages have made it difficult to decipher the economic health of the state, which if it were an independent country would be the fifth largest economy in the world.
The recovery of jobs lost in the pandemic was notably faster than in previous recessions, including the Great Recession, after which it took the state six years to recover all the jobs lost, according to Michael Bernick, a former director of the Employment Development Department. from California who is now an attorney at the Duane Morris Firm.
But California has taken longer to recover all the lost jobs compared to the rest of the country.
“To some degree, we are lagging behind the US economy,” Sohn said. “The technology sector used to be the dependency of the California economy, creating jobs. And now it has become a drag.”
Zachary Davis, co-owner of four ice cream parlors and a coffee shop in the city of Santa Cruz, laid off 70 of his 75 employees at the start of the pandemic. More than two years later, the store now has 85 workers.
“Some things are better, others worse. Everything is different,” Davis said. “I certainly don’t feel like we’re back to where we were.”