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California's Employment Development Department and the U.S. Bureau of Labor Statistics released California's May 2021 state jobs report today. Statewide nonfarm employment grew by an estimated 104,500 in May, the fourth straight month of six-digit growth. The official unemployment rate fell to 7.9 percent, less than half the peak of 16.0 percent last April at the height of the lockdown but still more than double the pre-pandemic level of 3.9 percent last February. The survey reflects job changes through the week of May 9 to May 15. California accounted for 18.7 percent of the national estimate of 559,000 net jobs gained in May, well above its 11.5 percent of the nation’s total payroll jobs as of February 2020.

The figure below shows how employment has evolved in both the state and the nation since the start of the pandemic. Overall employment in the state as of the middle of May was 7.4 percent below the level of February 2020, considerably worse than the national figure of 5.0 percent. Nearly half of this 2.4 percentage point gap is attributable to the leisure and hospitality sector which includes restaurants, bars, and hotels. California leisure/hospitality employment continued to rebound from the sharp drops in December and January, although it remains far more depressed than its national counterpart as the state was generally slower to lift pandemic-related restrictions than other states were.

The next graph isolates aggregate employment in the other sectors and shows that California has gradually been closing the gap this year.

The next figure summarizes nonfarm employment by sector based on the monthly survey of employers. The leisure and hospitality sector discussed above again accounted for more than half of the statewide net gain. The health, information, and private education sectors also had significant gains.


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