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Monthly Jobs Report July 19, 2024
Preliminary reports suggest the state added 22,500 jobs in June. We interpret these figures with caution because recent reports have overstated the strength of the state's labor market. A hybrid measure of the labor market, an average of the two main jobs surveys that has more closely tracked actual job growth over the past year, suggests the state added slightly fewer (20k jobs total) in June.
U.S. Retail Sales Update: June 2024 July 16, 2024
U.S. retail sales have grown 0.1 percent over the last 3 months and 2.3 percent over the last 12 months. Over both periods, sales have grown more slowly than inflation.
U.S. Retail Sales Update: May 2024 June 18, 2024
U.S. retail sales have grown 0.4 percent over the last 3 months and 2.3 percent over the last 12 months. Over both periods, sales have grown more slowly than inflation.
Inflation Tracker May 17, 2024
April data suggests a modest reversal of the recent uptrend in inflation. However, inflation remains above the pre-pandemic norm. Prices in California largely have tracked with this national trend.
Updated "Big Three" Revenue Outlook May 2, 2024
Revenues Likely to Fall Below Governor’s Budget Assumptions. Our forecast continues to suggest there is significant downside risk to state revenues relative to the Governor’s Budget. Specifically, our forecast is $19 billion below the Governor’s Budget across the 2022-23 to 2024-25 budget window. That being said, there is still significant uncertainty about how much revenue the state ultimately will collect. It is entirely possible that revenues could end up $8 billion higher or lower than our estimate for 2023-24 and $20 billion higher or lower for 2024-25.
California Housing Affordability Tracker (April 2024) April 30, 2024
Our post provides an updated snapshot of housing affordability in California. Over the last few years, we have seen a rapid increase in California housing costs, led by the dramatic increase in the costs of purchasing a home. Monthly costs for a newly purchased home are about $2,500 higher than they were just a few years ago. Annual income needed to qualify for a typical home is about $235,000—over 2 times higher than median household income (about $85,000). Further, the annual income needed to qualify for a more affordable "bottom-tier" home is over 50 percent higher than the median income.
Did California Enter a Recession Last Fall? October 3, 2023
While recessions are not formally defined for state economies, economic data for the fourth quarter of 2022 and first quarter of 2023 appear consistent with California experiencing a mild recession. The apparent start of a recession in California last fall helps explain why the state faced a revenue shortfall in its most recent budget. How much the economy will continue to dampen the state's fiscal picture moving forward is unclear. However, the threat that the recent slowdown could persist will be a significant risk for the foreseeable future.