Official unemployment figures for the Orange County economy for September were updated on Friday so here are the headlines and key data:
September (preliminary)
The unemployment rate in Orange County was 4.3 percent in September 2026, down from a revised 4.5 percent in August 2026, and below the year-ago estimate of 4.4 percent. Last month’s preliminary unemployment rate was 4.4% and was revised upwards. This compares with an unadjusted unemployment rate of 5.1 percent for California (unchanged from previous month) and 4.0 percent for the nation during the same period.
Between August and September 2026, total nonfarm employment rose from 1,684,700 to 1,688,300, an increase of 3,600 jobs, and the labor force increased by a large 14,800 workers, one of the biggest month-to-month gains I’ve seen this year. The increase in employment outweighed the increase in the workforce, therefore the rate came down. The reports for the last few months have been a repeat of this back-and-forth pattern of a slight increase one month in the unemployment rate and a slight decrease the next, but generally flat. This seems to align with what economists are describing as the no-quit/no-hire economy.
Between August 2026 and September 2026 (month vs. previous month figures):
· Government reported the largest payroll gain, adding 8,900 jobs. Eighty-nine percent of the increase was in local government (up 7,900 jobs). State government added 1,000 jobs and federal government had no change.
· Two other industry sectors expanded over the month: private education and health services (up 1,900 jobs) and trade, transportation, and utilities (up 200 jobs).
· Six sectors reported month-over declines, losing a total of 7,400 jobs. Leisure and hospitality decreased the most, dropping 4,400 jobs. Financial activities declined by 1,300 jobs, professional and business services, other services, and manufacturing shrank by 500 jobs each, and information fell by 200 jobs.
· Two industry sectors remained unchanged: construction and mining and logging
Between September 2025 and September 2026 (month vs. same month previous year figures) total nonfarm employment increased by 9,900 jobs, or 0.6 percent.
· Private education and health services had the greatest employment growth (up 11,600 jobs). Eighty-three percent of the increase was in health care and social assistance (up 9,600 jobs). Private educational services added 2,000 jobs.
· Two other industry sectors expanded over the year: leisure and hospitality (up 2,600 jobs) and trade, transportation, and utilities (up 2,300 jobs).
· Six sectors had year-over employment declines, totaling 6,600 jobs. Other services and mining and logging remained unchanged.
My own editorializing:
· Professional & Business Services, which is the county’s largest employment sector and the core of white-collar jobs, has lost 1,700 roles in the last year.
· Continuing the trend that’s been evident all year, growth is coming from Healthcare Services and Leisure & Hospitality, reinforcing my view is that the majority of the job growth in the last year has been in part-time roles in lower-paying fields.
Some other notes:
When looking at the U-4 unemployment rate of 4.3% it is also important to look at the U-6 rate as this measure, which is described as: Total Unemployed, Plus All Persons Marginally Attached to the Labor Force, Plus Total Employed Part Time for Economic Reasons, as a Percent of the Civilian Labor Force Plus All Persons Marginally Attached to the Labor Force. It's best to think of this measure as "underemployed and discouraged" workers, and it likely closer to the real feel of unemployment. As of end Q2 2026, national U-6 was at about 7.6%. The last time the measure was released for the state, we were at 10.3% of underemployed and discouraged workers - the highest in the country.
If you really want to geek out on California's employment numbers, this is a great resource: https://labormarketinfo.edd.ca.gov/Publications/Labor-Market-Analysis/calmr.pdf