California added 28,700 payroll jobs in March, lowering its unemployment rate to 5.3% despite a series of high-profile layoffs that have rocked the tech sector.
The gains were driven by nearly 28,000 jobs in the health services and private education sectors, according to figures released Friday by the state’s Employment Development Department.
However, the growth was inflated by the return of thousands of Kaiser Permanente workers who had been on strike in California and Hawaii. But jobs were added in long-term care, in home healthcare and at practitioners’ offices too.
“As we’ve seen throughout the post-pandemic period, healthcare was the big gainer among sectors,” said Michael Bernick, a former director of the state jobs agency.
Health services and private education has gained 160,400 workers since March 2025, according to the EDD.
Recording small gains too were the government, construction and financial sectors, though employment was lower than a year ago.
The job growth since February helped push the state’s unemployment rate down from 5.4% in January and February. Last year, it topped out at 5.6% and it was last at 5.3% in May 2025.
The state jobs picture still lags behind the nation, which recorded a 4.3% unemployment rate in March, when employers added 178,000 jobs.
However, California no longer has the highest state unemployment rate in the nation. It is now surpassed by Delaware at 5.4%. The rate drop was not all good news, though.
Total civilian employment — which includes agricultural workers and the self employed — fell by 39,600 jobs. That was exceeded by a decline of 56,700 workers in the labor force, driving down the unemployment rate.
Bernick said the decline in the labor force could reflect workers moving to other states and the federal crackdown on undocumented workers.
In California, major tech firms have laid off thousands of workers over the last few years. Just this month, Facebook owner Meta; L.A.’s Snap, operator of Snapchat; and corporate database behemoth Oracle announced more.
Hollywood studios also have been laying off thousands of workers amid a wave of consolidation and a slowdown in streaming film production. Disney is expected to lay off as many as 1,000 workers in the coming weeks.
Bernick said that while the layoffs have attracted widespread attention, they account for only a fraction of California’s large economy.
In December, 1.3% percent of workers were laid off in California, a number that has grown since July 2022 when it was 0.6%, according to Bureau of Labor Statistics data.
However, the latest figure is in line with rates over the last 25 years, with the exception of the recession in June 2009 and the pandemic in May 2020 when it was markedly higher, the data show.
Helping prop up the state’s economy is the massive investment in AI taking place in Silicon Valley — even as companies cite it as a reason for their layoffs — and the resurgent defense and aerospace sectors in Southern California.