San Diego County unemployment ticked up a bit from the previous month, with job growth in private education, healthcare, retail and leisure blunted by losses in higher education and the construction industry. But the overall economic outlook for the region looked brighter because of one surprising factor.
The region’s preliminary unemployment rate was 4.9% in August even as the local economy added 2,400 jobs, according to data released Friday by the state’s employment department. The jobless rate is a little worse than last month’s revised rate of 4.7%. But it’s an improvement from a year ago when the unemployment rate was 5.1%.
The month-over-month rate is higher, in part, because the available labor pool expanded by 3,800 people from July.
After shrinking for five straight months, the labor force’s growth is a “wonderful blip,” said Daniel Enemark, chief economist of the San Diego Regional Policy and Innovation Center.
“That’s good news because the labor force has been kind of in free fall. … We added 12% back of what we lost over the previous five months,” he said. “We’ll see what happens next month. If we continue to add more workers to the workforce, that would be really, really good for the economy.”
In terms of unemployment, San Diego is faring above average in the state, with California posting an unadjusted unemployment rate of 5.4% for the month. The county is, however, slacking behind the rest of the nation, which had an unemployment rate of 4.3%. The region’s unemployment rate is often lower than the California rate and higher than the U.S. rate, Enemark said.
There were notable job gains in August.
The private education and health services category had the largest, month-over-month net gain in employment, recording an increase of 1,600 jobs. Trade, transportation and utilities (wholesale and retail) also added 1,200 jobs; leisure and hospitality (arts and entertainment, food service) grew by 800; manufacturing was up by 200; and professional and business services (waste management, employment services) added back 200 jobs after big cuts in July.
Meanwhile, there was, as is typical for August, a surge in local school district positions (4,100 jobs added) and a big drop in public higher education jobs (2,600 jobs cut).
The construction industry also lost 1,000 positions, with specialty trade contractors and building equipment contractors hit with the most cuts. In addition, there were 600 jobs cut across information (publishing), financial activities (real estate leasing) and other services (repair, laundry, religious).
When adjusted for seasonal swings, San Diego County’s unemployment rate in August was 4.5%, Enemark said. That compares to an adjusted 4.1% U.S. jobless rate and 5.1% in California.
“The overall story of unemployment (in San Diego County) is that, with the exception of two months, unemployment has been in the 4 point-something range since June of 2024. That is wild. That is so stable. It’s like eerily stable,” the economist said.
In total, San Diego County’s labor force — adults who either have a job or are actively looking for one — notched up to 1.64 million people in August. That compares to the local labor force record of 1.68 million people in March 2025. In August, there were 80,300 unemployed individuals in the county compared to 76,700 in July.
The big picture
Over the past 12 months, San Diego County has added 10,600 jobs.
The largest job gainer was healthcare and social assistance services with 12,300 positions. The sector was led by 6,500 jobs in ambulatory healthcare services, which provide outpatient care. Private educational services offset the advancements by 100 jobs.
Other job gainers included leisure and hospitality with 5,500; other services with 2,100 new jobs; trade, transportation, and utilities with 1,100; and professional and business services with 100.
Job losses in five sectors slowed the year-over-year growth. Government had the largest decline of 4,200, with most of those jobs attributed to the federal government (down 4,100). Construction, down by 3,200 jobs, shed the next largest number of positions during the 12-month period.
State officials do not seasonally adjust jobless rates for individual counties. San Diego County ranked 14th in the state — or in the top 25% of counties — with its unadjusted employment rate of 4.9% in August.
Los Angeles County and Alameda County tied San Diego with an unemployment rate of 4.9%. The jobless rate was 4.4% in Orange County, 4.2% in San Francisco County, 4.3% in Santa Clara County, 5.3% in Santa Cruz County and 6.2% in Riverside County.