Businesses continue to labor with workforce shortages

Nearly 5,000 more people are working in Tulare County than a year ago yet unemployment rate returns to double digits for the first time in almost two years

TULARE COUNTY – With “help wanted” signs at businesses in every corner of the county, conventional wisdom would suggest the unemployment rate is going down in Tulare County. Unfortunately, there is nothing conventional about the current labor market.

Tulare County’s unemployment rate crossed the double digit threshold in February for the first time in nearly two years, according to the latest number from the California Employment Development Department. That’s only a half percent higher than January but more than a percent from a year ago.

The increase isn’t due to fewer businesses looking for people but rather more people looking for work. There are nearly 5,000 more people in the workforce as of February, a 2.8% increase from last year, all of them in nonfarm sectors. Not surprisingly, private education and health care led the way hiring 1,800 people in the last year, including 400 in the last month, to replace a silver tsunami of retirements from teaching and nurses burnt out during the pandemic. A close second was government, which has hired an additional 1,100 people since February 2022 and a whopping 700 since January as cities ramp up to complete ARPA projects before inflation gets any worse. The leisure and hospitality sector is also making a comeback with 700 new jobs. The February “Visit California Lodging Report” shows the Tulare/Visalia metro area hotel occupancy rate down to 58% compared to 66.7% in February 2022. Other Valley cities were down as well but not as much as Southern California and Bay Area.

Logistics and construction were the only industries to see a dip in its labor force with both reducing their workforces by about 200 people in the last year. Construction has been slow to build momentum following the pandemic and rising inflation but there could be a building boom when interest rates fall. Despite the losses, logistics remains the third largest employer thanks to Amazon, ACE, UPS, Golden State Overnight, Walmart and Joann all having major warehousing hubs here.

The local unemployment rate is significantly higher than the state and national rates of 4.8 and 3.9%, respectively, but that’s not new for Tulare County, where unemployment averages in teens due to huge swings in seasonal employment, mostly in agriculture. Agriculture is still the largest employer in the county at times of the year, but government jobs now lead Tulare County employment with 34,000 in February.

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