Amid widespread concerns about prices, job growth, and a potential recession, the latest data on California’s labor market is on par with recent months. In April, employers added 17,700 jobs on net, and unemployment held steady at 5.3% (though it remained significantly higher than the US rate). Since mid-2022, California’s job market has softened. The rate of job openings has fallen by half, and annual employment growth has slowed from above 6% to less than 1%. This post examines which workers are struggling the most with these worsening labor market conditions.

Overall, 1,055,000 Californians are looking for work as of April (5.3% of the workforce). That’s a 45% increase in unemployment since August 2022, when rapid job recovery after the pandemic led to the lowest unemployment rate in recent state history. While not currently high by historical standards, the rate of unemployment increased steadily through mid-2024 and has not budged much since.

Further, the official unemployment rate does not capture those Californians who have stopped looking for work because the prospects are slim or those working part time when they’d rather be working full time. When we include these discouraged and underemployed workers, we find about 10% of Californians—almost 2 million—are un- or underemployed as of the last quarter (February–April 2025).

Today, workers age 20–24 and those without a high school diploma have the highest unemployment rates. Black and Latino workers have the highest unemployment across racial/ethnic groups, and men are more likely to be unemployed than women. Except for gender, these unemployment patterns predate the recent labor market softening. Most of these groups have also experienced the largest increases in unemployment since 2022.

Here’s a closer look at trends within demographic groups:

Age: California’s youngest workers (age 20–24) have the highest unemployment rate (10.8%) across age groups. Higher unemployment among young workers is typical, given the time it takes to find a first job and/or enter a career. But these young workers have also had, by far, the largest increase in unemployment (54%) since 2022, more than twice as much as every other age group. Though about one-third of workers age 20–24 are both in school and in the workforce, high unemployment rates persist regardless of school attendance. The second-youngest group of workers (age 25–34) also have higher unemployment rates but have seen less of an increase in the last three years. Unemployment rates are historically lowest for workers age 45–54, and this remains true, despite upticks in the last three years. Finally, as workers close in on—or pass—the traditional retirement age (65), their unemployment rates increase; this holds today, even as the market has softened.

Education: Across education levels, those without a high school diploma have the highest unemployment (9.3%). Again, this is a typical pattern, but it has been exacerbated by the worsening job market. The gap in unemployment between those without a high school diploma and those with at least a four-year degree has grown from about 3 points in 2022 to about 6 points today. Workers without a high school diploma have had an especially dramatic increase in unemployment (53%) since 2022; most other groups saw smaller upticks. Unemployment has remained relatively steady for workers with some college but no four-year degree.

Race and ethnicity: Black workers have the highest rate of unemployment (6.4% as of the last quarter), and their rates have been relatively steady in recent years. On the other end of the spectrum, Asian workers have the lowest rate of unemployment (2.7%) and have actually seen improvements (from 3.1% in 2022). White and Latino workers have unemployment rates of 4.9% and 6.2%, respectively, as of the last quarter. Since 2022, white workers have seen the largest increase in unemployment (48%) across racial/ethnic groups.

Gender: Today and for the past three years, women’s unemployment has been lower than men’s (4.6% vs 5.6%)—a reversal of pre-pandemic trends. Recent increases for both groups follow the same trend, with the unemployment rate for men increasing more than the women’s rate.

When we include discouraged and underemployed workers, patterns are similar. The youngest workers and those with the lowest levels of education have by far the highest rates of un- and underemployment (20.6% and 18.5%, respectively) as of the last quarter. Black and Latino workers have the next highest rates, at around 12.5%.

While California’s job market has been slowing since 2022, so far the pattern has not taken any major turns in 2025. Beyond the challenges to growth the state’s largest sectors have faced, there are national and global economic headwinds. As state leaders confront challenging budget decisions over the next month, it will be important to consider options to spur economic growth and at the same time support workers who are navigating a tough and uncertain job market.