California adds jobs but wage growth stagnates

150 150 Ed Coghlan

California’s economy generated another 56,000 jobs in April, which has helped reduce the state’s jobless rate to 7.8 percent, the first time in five years it’s been lower than 8 percent. The state’s beleaguered construction industry continued to rebound by adding over 7,000 jobs.

The news looks a little more promising for members of the Millennial Generation, at least those with college degrees. A recent report also indicates the employment opportunities for 2014 college graduates are quite a bit better. Employers expect to hire 9 percent more college graduates this spring than those from the class of 2013.

Carl Martellino, executive director of the University of Southern California Career Center, has seen the uptick in hiring firsthand.

“We’ve seen an increase in the number of employers who come to our career fairs, an increase in on-campus recruiting, and an increase in students with multiple job offers,” Martellino said. “There has been an increase not only in attendance, but also in the quality of companies coming to campus.”

While California’s job growth continues to lead the nation, we certainly aren’t alone in job creation. The U.S. economy has regained 8.6 million jobs since early 2010, leaving it about 100,000 jobs short of the 138.4 million that existed in January 2008 near the start of the recession. Federal Reserve Chair Janet Yellen says small businesses, as they always do, are driving the trend.

There is some cold water to pour on this mostly bullish jobs picture right now.

The California Budget Project issued a white paper recently talking not about employment but how much people are being paid. It reported that low-wage and mid-wage workers in California still earned significantly less in 2013 than before the Great Recession began, after adjusting for inflation.

“This wage erosion continues a decades-long trend of widening wage inequality,” the authors said. The report adds that two ways of reversing the trend are to invest in the workforce and infrastructure in the state. The quality of California’s workforce is a constant point of discussion among those who discuss job growth and the kind of jobs we want to grow.

The California Economic Summit Action Teams have been working on what have been identified as nine important areas to help spur the creation of more “good jobs” in California. One of those areas is workforce preparation—how we align the workforce with the 21st-century economy.

Progress is being made. After a concerted effort by advocates of career techincal education, including the Summit, $50 million was added to Gov. Jerry Brown’s May revision to the state budget, along with other support for CTE. The Summit Workforce Action team submitted testimony last month to the Assembly education finance budget sub-committee outlining how these proposals align with the Summit’s goals and recently delivered a letter to legislative leadership signed by team members.

The Summit reported on other legislation introduced to address the glaring need for more CTE funding in the Golden State. Assembly member Al Muratsuchi has introduced several bills to provide incentive funding for CTE (including AB 2216). In March, Sen. Carol Liu also offered to carry a bill on the same issue. 


Ed Coghlan

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