Business Services and Construction
Have Led the 1990s' Expansion
Annual Average Percent Change in California Jobs, 1994 Through 2000
The single strongest sector leading California's 1990s' expansion has been business services, especially the segments associated with the high-tech "new
economy."
Construction recorded the next strongest percentage job gains, reflecting rapid increases in nonresidential construction and remodeling activity, along with
moderate growth in single-family housing. Electronics manufacturing also registered solid growth, led by increases in computers, telecommunications, and
instruments.
Lagging industry categories have included aerospace and federal government employment, both of which have been adversely affected by defense cutbacks.
The State's Software Industries
Have Boomed During the Decade
New Jobs, 1994 to Early 2000
The most dramatic aspect of California's economic expansion in the 1990s has been the growth in the state's computer-related services industries.
These industries, which include businesses involved in development of computer systems, software, and the Internet, have increased from less than 130,000
jobs in 1994 to nearly 340,000 by early 2000.
Employee compensation in these industries also has grown dramatically, with several subsectors paying average annual incomes in excess of $100,000. These
high payments partly reflect stock options and bonuses granted to many employees in these industries.
Nonresidential Construction Has Led California's Building Rebound
Construction Permits, 1989 Through 2000
Construction was one of the state's fastest growing employment sectors in the second half of the 1990s, with all industry segments experiencing
gains--residential, nonresidential, and additions/alterations.
The rebound in the residential sector has been moderate by historical standards, with permits currently well below the 1980s' average. This reflects such
factors as local building controls and lengthened times for the issuance of new permits.
In contrast, nonresidential construction activity has soared in recent years, with total permit valuations nearing all-time highs.
High California Home Prices Have Driven Down Affordability
Median Home Prices in July 2000
Strong economic growth has put significant upward pressure on housing prices in California, particularly in coastal regions. This has especially eroded
affordability in the Bay Area, Orange County, and San Diego.
The statewide median price of a single-family home has risen from $175,000 in 1996 to about $245,000 as of mid-2000. Currently, less than one-third of
California households have sufficient income to purchase such a home.
By far, the highest cost region is the San Francisco Bay Area, which had a median home price of $460,000 in mid-2000. At the other extreme, the median
price was $140,000 in the Inland Empire and the Central Valley.
California Is The Nation's
Leading Agricultural Producer
Top Agricultural Products by Cash Receipts 1999
California is the largest agricultural producer in the nation.
Total receipts from farming were nearly $25 billion in 1998, accounting for one-eighth of the national total and greater than Texas and Iowa combined--the
second and third largest agricultural states.
Major commodities in California include dairy and nursery products, grapes, cattle, and lettuce.
The state also is a dominant producer of many specialty crops, such as strawberries, oranges, kiwis, and artichokes.
Features of the "New Economy"
California is a primary beneficiary of the "new economy," given its emphasis on high-tech activities.
For example, the state has roughly one-fifth of the nation's workforce in industries such as computers, software, and the Internet.
