September Employment Slowdown

by Brian Thomas | Oct 20, 2015

The strong summer job growth in Santa Barbara County has come to a pause in September. The September data, released on October 16th, shows that civilian employment declined by 0.2% and nonfarm payrolls are flat with 0.0% growth. Santa Barbara is not the only area with this September slowdown in employment growth. The U.S. had similarly strong summer employment growth with a slowdown that started in August and continued in September.  Read more about the U.S. employment data at the U.S. Economic Snapshot.



While job growth stagnated in September, the unemployment rate continued to decline. Santa Barbara County’s unemployment rate is now at 4.7%, the lowest rate in almost eight years. This current unemployment rate is remarkably low, even for the Santa Barbara County region, which typically has a relatively low unemployment rate. The reason for the September decline appears to be related to a decline in the labor force. As discussed in prior posts, the unemployment rate can decline because unemployed workers find jobs or because unemployed workers leave the labor force. The latter appears to be the cause for this month’s decline. However, over the past year, both employment and the labor force have increased, which suggests the year over year decline in the unemployment rate is caused by unemployed workers finding employment.


Part of the reason for the September slowdown is a decline in Leisure and Hospitality employment. This sector, which grew rapidly over the summer months, had seasonally adjusted employment declines of 0.7% in September. Typically, the non-adjusted employment in Leisure and Hospitality declines by 1.1% each September, as the summer vacation months come to an end, but this year the non-adjusted employment declined by 2.1%. Even with this large decline in September, Leisure and Hospitality remains up by 8.5% over the year, leading all other industries.



In the city data, every single city had employment declines in September, ranging from a decline of 0.6% in Carpinteria and Lompoc to a decline of 0.2% in Santa Barbara and Santa Maria. However, every city also had a decline in their unemployment rate, with declines ranging between 0.1 percentage points to 0.2 percentage points throughout the county. Lompoc remains the city with the highest unemployment rate, at 6.1%.