POLITICS

No, California's economy is not growing faster than the rest of the country

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Politics,Beltway Confidential,Conn Carroll

Jim Tankersley’s optimistic take on California’s economy in today’s Washington Post does not contain many facts, and when it does, they are misleading. For example, Tankersley writes:

A year ago, the state was a mess, with double-digit unemployment, a bottoming-out housing market and scary budget deficits. Now, hiring is up faster than the national average, and the housing market is regaining strength. Even the state budget is back in the black.

As far as California’s budget being balanced, Tankersley does not cite any numbers, but Gov. Jerry Brown did project his proposed budget would end $1 billion in the black. And if you believe everything Jerry Brown tells you, then sure, California’s budget is balanced. But the fact is that California governors almost always overestimate revenues. And just a month earlier, California’s Legislative Analysts Office projected the state would end the year $1.9 billion in the red. Considering actual tax collections are already behind the LAO’s projections, if Tankersley actually believes California’s budget is balanced, then I have some land in Mendota I’d like to sell him.

As far as hiring in the Golden State, Tankersley does report:

Unemployment is still 9.8 percent in California, two percentage points above the national rate. But by all indications, the state economy has improved rapidly in the past year. California’s unemployment fell by 1.4 percentage points in 2012, compared with a 0.7-point drop for the country as a whole.

Problem is, a falling unemployment rate does not mean California is creating jobs faster than the rest of the country. It could also mean that more unemployed college graduates are going back to school or elderly Californians are retiring early. The Labor Department does not release state level Current Population Survey data on labor participation rates, but we can compare Employer Survey data from California to the country as a whole.

Over the course of 2012, California added 226,000 jobs, or 1.59 percent growth. Meanwhile, the rest of the nation added 2.17 million jobs, or 1.63 percent job growth. Now 1.63 is close to 1.59, but 1.59 is still lower. So California while is not doing much worse than the rest of the nation when it comes to creating jobs, it is definitely not doing any better.

Do they have any fact checkers at The Post?

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