With voters set to choose a new governor, several statewide officeholders, state legislators and members of Congress in just two months, candidates up and down the ballot are making plenty of promises. But the state’s slow bleed of employment, particularly in the industries that once defined its economy, has barely registered as a campaign issue.

The numbers tell a sobering story. California has never fully rebounded from the pandemic-era shutdown, and more than a million residents remain out of work. The state’s unemployment rate is among the highest in the nation, and long-standing economic engines such as technology and film production have been losing jobs for years rather than adding them.

A closer look at the data suggests the problem runs deeper than the headline figures indicate.

“California’s labor market is holding up, but its foundations remain troublingly narrow,” said Justin Niakamal, research manager at Beacon Economics, in a recent assessment of the state’s economic health. According to Niakamal, healthcare stands out as essentially the only sector posting solid job growth.

That might sound like good news, but healthcare employment in California leans heavily on government spending — both state and federal — and both sources of funding have been tightening. Unlike technology, agriculture or entertainment production, healthcare also doesn’t generate the kind of added economic value that builds broader prosperity; it’s a service sector, not a wealth-creating one.

The state’s official unemployment rate stood at 5.1% in July, trailing only Connecticut and Oregon, which each posted 5.2%. That figure reflects the share of the labor force without any job, including part-time work, during the month measured.

But the size of the labor force itself tells its own story. Over the past year, California’s labor force — those working or actively looking for work — shrank by 286,300 people, according to the state’s Employment Development Department. That decline tends to soften the official unemployment number, masking a more significant erosion in actual jobs. It’s also worth noting that anyone who works even a few paid hours in a month counts as “employed” under the standard measure.

Federal officials calculate more nuanced figures that paint a starker picture. One of these, known as the U-6 rate, accounts for underemployment — people working part-time who want full-time jobs, along with those only loosely attached to the labor force. California’s U-6 rate hit 10.3% in June, the highest of any state in the country.

For comparison, the U.S. Bureau of Labor Statistics also calculates U-6 figures for a few large counties and cities whose populations rival entire states. New York City came in at 10.2%, while Los Angeles County’s rate reached 12.1% — even worse than the statewide figure.

Yet even those numbers may not capture the full extent of the problem. The Ludwig Institute for Shared Economic Prosperity has developed what it calls a “true rate of unemployment,” which goes a step further than U-6 by excluding jobs — even full-time positions — that pay below what it considers a living wage, set at $26,000 annually. The institute frames this as a measure of “functional unemployment.”

Unsurprisingly, California’s numbers under this framework are alarming, particularly in rural areas dependent on agricultural work. Redding tops the list with a “true unemployment” rate of 67.4%, according to the institute’s regional breakdown. Several other rural and semi-rural areas fall between 50% and 65%. Even major urban centers aren’t spared — the Los Angeles-Long Beach-Anaheim metro area registers 53.8% under this measure. Only a handful of California regions dip below the 50% mark.

Given the scale of these figures, one might expect California’s candidates and elected officials to be laying out plans to address the state’s employment crisis. So far, that conversation has been notably absent from the campaign trail.

Original source: CalMatters

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In a wide-open contest ahead of a June primary, a burst of negative publicity aimed at the Democratic U.S. House member suggests that Swalwell’s leading rivals see him gaining momentum in a race that has been overshadowed by international wars, turmoil in Washington and soaring gas prices.

To listen to his competitors, he has a no-show job in Congress, he might not live in California and he’s a sympathizer with U.S. Immigration and Customs Enforcement, which staged immigration raids across Los Angeles that led to violent protests. His campaign disputes those claims.

“Whoever’s head starts to stick up higher than the rest, the other candidates pick up their mallets and start to knock them back down,” said Democratic consultant Roger Salazar, who is not involved in the contest.

With high-profile endorsements from Democratic U.S. Sen. Adam Schiff and the influential Service Employees International Union California — paired with favorable polling — other campaigns ramped up attacks in an apparent effort to blunt any Swalwell gains. In a race that has yet to capture the public’s attention, marquee endorsements can move votes.

“It’s like a kids’ soccer game — people move with the pack,” Salazar added.

Residency questions shake up campaign

Swalwell, an Iowa native, was elected in 2012 and represents a House district east of San Francisco. He launched a presidential run in April 2019 but shuttered it a few months later after failing to catch on with voters. He is perhaps best known nationally as a House manager in President Donald Trump’s second impeachment trial during his first term in early 2021.

Billionaire hedge fund manager-turned-liberal activist Tom Steyer, who is among a handful of leading Democrats, posted a digital ad mocking Swalwell for missing votes in Congress that depicted the congressman taking dunks in a pool while the U.S. House was calling votes, while his campaign separately questioned Swalwell’s residency status in California. According to the Swalwell campaign, the Steyer post used video that the congressman put out during the 2025 government shutdown.

Steve Hilton, a former Fox News host and one of the leading Republicans, has said Swalwell should be disqualified because of questions about his residency.

In a letter to the state’s chief elections officer earlier this month, Steyer’s campaign argued the Swalwell lived in California “on paper” and asked the office to investigate whether the congressman is eligible to serve as governor. The state constitution requires five years of residency to run for governor, but the California Secretary of State’s Office has said the provision is unenforceable.

The office did not immediately respond to an email inquiring about the status of the request.

The California Post recently sent a reporter to Swalwell’s listed address in the San Francisco Bay Area. The news outlet interviewed neighbors who said they had never seen Swalwell. Meanwhile, Swalwell’s landlord filed legal papers with the secretary of state affirming that the congressman and his wife have rented the property since 2017. “He lives at the property,” the documents said.

Swalwell said he receives hundreds of death threats and keeps his address private to protect his family, and he accused Steyer and the news outlet of putting them at risk. His campaign says his living arrangements are no different from any other House member from California. He maintains dual residences, one in the state and the other in Washington.

In a related development Friday, a state court in Sacramento issued a tentative ruling denying a petition that asked the court to block election officials from certifying Swalwell’s candidacy, arguing that he was ineligible to serve because he lived in Washington.

Swalwell missed votes in September following the death of his mother, but campaign spokesperson Micah Beasley added that the congressman “has always been present for important or close votes.”

“Tom Steyer has spent $100 MILLION lying about me,” Swalwell posted on the social platform X.

Another leading Democrat, former Rep. Katie Porter, has dinged Swalwell for what she describes as his support for immigration enforcement personnel.

“Eric Swalwell voted to thank ICE,” Porter wrote in an email to supporters. “ICE needs to be abolished, not thanked.”

His campaign confirmed that Swalwell was among 75 Democrats who voted last year in favor of a GOP-sponsored resolution condemning an attack on a Colorado demonstration that was being held in support of Israeli hostages, which left one woman dead. The resolution expressed “gratitude” to law enforcement, including ICE.

His campaign added that he has proposed restrictions on ICE activities, including requiring agents to remove masks and display official identification. “If there’s someone that Rep. Swalwell has gone after more than Trump, it’s ICE,” Beasley said.

Candidates try to break from the pack

With mail-in voting scheduled to begin in early May, candidates are jostling for advantage in a race in which a fraction of a percentage point could decide the outcome. The election marks the first time since voters approved the state’s “ top two ” primary system more than a decade ago that there has been a governor’s race with no dominant candidate, enticing a crowd of Democrats into the contest.

Indeed, Democrats are openly fretting that the party’s numerous candidates will undercut each other and allow two Republicans to advance to the November election. Even in the heavily Democratic state, an all-GOP general election is possible under the unusual top-two primary system, which puts all candidates on one ballot and advances the top-two vote-getters, regardless of party.

Recent polling by the nonpartisan Public Policy Institute of California found the field had broken into two distinct groups, with Swalwell, Hilton, Porter, Steyer and Riverside County Sheriff Chad Bianco, a Republican, in close competition, with other candidates trailing.

Swalwell faces the same challenge as other Democrats — how to stand apart in a field where the candidates largely agree on many issues, including resistance to Trump’s agenda and lowering the cost of living in a state with some of the nation’s highest housing costs, taxes and utility bills.

Even with Swalwell winning a coveted endorsement from SEIU, “there’s still a little bit of a window” for another Democratic candidate to pull ahead, said Democratic political consultant Elizabeth Ashford.

“There is momentum behind Swalwell,” she said. “I just don’t know that it has reached quite the tipping point of like, ‘OK, this is the clear front-runner.’”

The uncertainty hovering over the race to replace outgoing Democratic Gov. Gavin Newsom was underscored by a rare but not unprecedented decision by the powerful California Federation of Labor Unions, which endorsed four rival Democrats — Swalwell, Steyer, Villaraigosa and Porter. Each has an extensive history working with labor.

Federation President Lorena Gonzalez Fletcher said the dynamics of the race continue to fluctuate.

“I think you’re still going to see a lot of that bouncing back and forth before it really settles in,” she added.

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