California businesses added just 40,200 in October, and the September total was revised up slightly. Despite these gains, the state's unemployment rate climbed to 4.8 percent. The "Sahm rule," a real-time recession indicator that first triggered on in March, continues to signal the beginning of an economic downturn.
The administration's recent Unemployment Insurance (UI) Trust Fund forecast shows that UI benefit payments will exceed state payroll tax contributions by $1.1 billion in 2023. Historically, benefit payments have only exceeded contributions during major economic downturns. For the first time, the fund is expected to be out of balance during a period of job growth.