Center for Strategic Economic Research
Economy Watch and the Quarterly Economic Report are ongoing publications examining various economic growth indicators and other factors in the Sacramento Region. These publications presents a snapshot of current economic conditions in the Sacramento Region and provide comparisons with other selected regions of California and the United States.
FOURTH QUARTER 2013 REPORT

With continued improvement, job growth in the Sacramento Region moved above the statewide and national averages

The six-county Sacramento Region experienced a 2.3 percent increase in the number of employees on Nonfarm payrolls between December 2012 and 2013. Preliminary data show that, during this period, the Region saw a net gain of 19,500 jobs. Sacramentos rate of growth at the end of 2013 is notable for five main reasons. First, annual job growth exceeded the statewide and national averages as well as the SF Bay Area for the first time since the summer of 2006. Second, the Regions rate of growth was a full percentage point higher than at the end of 2012 despite seeing a slowing growth pattern in the middle of the year. Third, annual gains were posted in both the Regions public and private sectors for five straight months at the end of the year. Fourth, healthy growth rates were present in both of the Regions sub-markets with the core Sacramento metro area posting 2.2 percent annual job growth in December 2013 and the Yuba-Sutter area growing by 4.5 percent. Finally, all of the five largest sectors in the regional economy shifted to positive job growth, leading to the pronounced uptick seen in the Region over latter part of the year. The largest sector, Government, posted 1.3 percent job growth in December 2013 with gains confined to state government activities. The retail-dominated, Trade, Transportation, & Utilities sector experienced a gradual decline, but ended the year with 2.7 percent growth supported by continued improvement in the economy overall. Educational & Health Services also saw slightly slower growth at the end of the year; nevertheless, continued gains in the health care segments led to 2.4 percent annual job growth in this sector. The Professional & Business Services sector recovered from the dramatic downturn caused by drops in administrative and support activities to end the year at 3.4 percent annual job growth balanced across all segments of the sector. The volatile Leisure & Hospitality sector ramped up throughout the year with 6.2 percent job growth in December 2013, mainly supported by gains in food services. Continued healthy job growth performance in these large sectors should allow the Region to see relatively strong economic conditions.

The state and nation both posted 1.6 percent annual job growth in December 2013. California saw jobs on payrolls increase by almost 237,000 in the past 12 months while the nation posted a 2.2 million net increase. These two benchmarks ended the year with slower job growth than at the end of 2012. Similarly, the SF Bay Area saw annual job growth dip throughout 2013, finishing the year at 2.0 percent, which was 1.4 percentage points lower than at the end of 2012. Annual job growth in the Stockton market came in at 1.7 percent in December 2013, reflecting a gain of 3,200 jobs. The Solano market experienced 2.9 percent job growth over the 12 months ending December 2013 with the addition of 3,600 jobs on payrolls. While both Stockton and Solano saw variable job growth throughout the year, the two markets ended 2013 with similar job growth as the same point in the previous year.

Annual Job Growth

Data Sources: CA Employment Development Department and U.S. Bureau of Labor Statistics

Major Sector Annual Job Gains and Losses
Data Source: CA Employment Development Department

Most of the Sacramento Region's major sectors added jobs in the past year

Seven of the Sacramento Regions eleven major sectors added jobs between December 2012 and 2013 with the five largest sectors topping the list. These five sectors added a total of over 19,000 jobs over the past year. Two key sectors for the Region also added jobs last year, Construction and Manufacturing. Leader in the Construction sector have perceived positive changes in industry conditions for some time even as statistics continued to suggest annual job losses. The sectors shift back to positive job growth ends the 14-month streak of annual job losses. The Regions high-value Manufacturing sector has posted annual job gains for 35 of the past 36 months. The four sectors that lost jobs in the past 12 months, shed a total of roughly 1,800 jobs, which is one-third the size of the gain generated in the Leisure & Hospitality sector alone. The Regions net gain of 19,500 jobs pushed total Nonfarm employment up to 884,500, which is now only 69,000 jobs below the summer 2007 peak (and almost 50,000 jobs above the low point in the recession from the winter of 2011). Regional employment is now tracking around 2004 levels.

SCalifornia only posted annual losses in one major sector, Government. Similar to the Sacramento Region, the Leisure & Hospitality sector added the most jobs statewide and both Construction and Manufacturing saw notable gains. The Professional & Business Services sector posted the greatest job gains in the SF Bay Area between December 2012 and 2013. Three major sectors lost jobs in the past year in the SF Bay Area. The Stockton market also saw losses in three major sectors while the largest annual job gains were seen in the Government sector. Solanos Trade, Transportation, & Utilities sector added the most jobs in the market in the past 12 months while only the Government sector shed jobs.