California's Economic Decline Deepens as Job Growth Lags Nation
Event summary
- From February 2020 to December 2025, California's non-farm job growth was just 2%, less than half the national rate of 4.3%.
- Private sector jobs outside healthcare declined by 2.7% in California, compared to 3.4% growth nationally.
- After accounting for taxes, housing, and energy costs, California households have 35% less disposable income than the national median.
- California lost nearly 52,000 tech jobs in 2024 and saw a 10.3% decline in finance sector employment between 2019 and 2025.
The big picture
California's economic performance has fallen sharply behind the rest of the nation, with job growth lagging and high costs eroding income advantages. The state's historical economic edge is now threatened by a combination of high taxes, costly housing, expensive energy, and burdensome regulations that discourage business investment. This shift marks a significant reversal from prior decades when California outperformed the nation.
What we're watching
- Policy Reforms
- Whether California's policymakers will implement meaningful reforms to address high costs and slow growth.
- Industry Shifts
- How the loss of core industry jobs in tech, manufacturing, and finance will impact long-term economic stability.
- Population Dynamics
- The pace at which population outflow continues and its effect on California's economic trajectory.
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