California’s 5.3% unemployment in February was the highest rate in the nation.

My trusty spreadsheet, looking at labor stats dating to 1976, could find only 11 other months the state reached this dubious ranking. Look to the early 1990s economic malaise (August to December 1994) and the coronavirus chill (March to August 2021).

That’s on top of our previous mention in this space that 2023 was the first year since 1994 that the state ranked dead last in the nation for job growth on a percentage-point basis.

To be fair, California historically has been the nation’s leading job creator. At the same time, it’s a reasonable bet that in any given month California will be high on the joblessness scorecard.

Consider that California unemployment has ranked second-highest amongst the states in 72 months over 48 years. It was third 52 times, fourth 35 times, and fifth 49 times.

So an average month since 1976 has seen California unemployment ranked No. 10 among the states. Only five places fared worse – Alaska, the District of Columbia, West Virginia, Mississippi, and Michigan.

And by the way, here’s another example of California’s persistent high joblessness: Its best month in the unemployment rankings since 1976 was 29th best in October 1987.

Yes, the best ranking was a paltry 29th place.

Why so high?

California has heavy concentrations of workers in businesses with big seasonal swings – hospitality, agriculture, and retail. Other economically volatile industries, major employers in California, include technology, real estate, and entertainment.

Additionally, California’s celebrated entrepreneurial grit has a downside – that risk-taking creates a higher-than-average failure rate. That can also boost unemployment.

Consider a yardstick for chronic high unemployment from my spreadsheet: How often during the past 48 years has a state’s monthly jobless rate ranked among the nation’s 10 highest?

This is not a Top 10 list to be envied.

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By this measure, California ranked in the Top 10 in 63% of the months since 1976. Just four others ranked more frequently: Alaska at 78%, DC at 69%, Michigan at 66%, and West Virginia at 63%.

Please note that California’s economic rivals were in the middle of the pack: Texas was No. 21 at 17% and Florida was 24th at 15%.

It’s worth noting that 12 states never made the Top 10 – Colorado, Iowa, Kansas, Maryland, Minnesota, Nebraska, New Hampshire, North Dakota, South Dakota, Utah, Vermont, and Virginia, a diverse mix economically and politically.

Bottom line

It’s hard to sugarcoat California’s high unemployment in February.

Look, California’s astronomically lofty cost of living nudges folks with solid finances to think about relocating – no less those who are missing a paycheck.

But let’s mention that the state’s chronically high joblessness during the past half-century came as California created more jobs than any other state since 1976.

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That’s 9.7 million new jobs – 13% of all US hires. Even California’s job growth rate of 119% topped the 92% employment expansion in the rest of the nation.

Not to dismiss the pain of joblessness, but that top-of-the-nation 5.3% February rate is historically low. California has averaged 7.2% unemployment since 1976.

These stats suggest California employers have enjoyed the deep supply of job candidates that unemployment can create.

These same figures also indicate that California workers, if nothing else, have been very flexible.

PS: Ponder Nebraska, where the average monthly jobless ranking since 1976 is No. 48. That’s the lowest among the states. But Nebraska employers added just 477,000 workers over the 48 years – 95% less than California’s hirings.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

A few readers thought I was a tad harsh in a recent column that noted California had the nation’s slowest job growth in 2023.

Yes, adding any number of jobs isn’t bad – but 154,000 new workers equals only 0.9% growth in a hot US job market that grew 2%. That hiring pace – as measured on a percentage-point basis – ranked No. 51 among the states and the District of Columbia.

We often forget that California is by far the nation’s largest job market with 17.8 million workers. My trusty spreadsheet tells me the Golden State has ranked No. 1 since 1972. The second-biggest job market in the US is Texas at 13.9 million workers. Florida is No. 3 at 9.7 million.

But my readers’ argument that California’s size would make it hard to be among the fastest growing on a percentage-point basis is a stretch. Texas (3.3% more jobs in 2023) and Florida (up 3.4%) ranked in 2023’s top three for percentage growth along with Nevada (up 3.4%).

Look, there are various ways to measure economic progress.

Remember, percentage-point growth shows us the relative scale of hiring trends on the overall California job market as well as against other states. Still, let’s look at California ranked by the number of new jobs created – not the 2023 percentage gain.

My trusty spreadsheet tells me that those 154,000 California hires last year were topped by only three states – Texas (449,600), Florida (316,600), and New York (195,000).

However, California having lofty spots on this kind of job-creation scorecard is nothing newsy. California ranked No. 1 or No. 2 for total new jobs in 11 of the past 12 years (let’s forget coronavirus-chilled 2020’s last-place finish).

And historically speaking, over the past 52 years as the largest job market, California’s count of new workers led the nation 27 times and ranked second 10 times.

Or look how modest last year’s hiring was this way: 154,000 new jobs was 27% below California’s average year since 1972.

High rankings often equal high expectations. And in 2023, California’s job market missed its high bar.

Locally speaking

Where were those 154,000 California jobs created last year? Largely to the south, when looking at state data tracking 29 employment hubs …

1. San Diego: 21,000 new jobs bringing its total to 1.56 million (California’s No. 4 employment center).

2. Inland Empire: 19,800 jobs added to 1.69 million (No. 3).

3. Sacramento: 18,200 jobs added to 1.09 million (No. 8).

4. Orange County: 17,000 jobs added to 1.7 million (No. 2).

5. Los Angeles: 13,400 jobs added to 4.59 million (No. 1).

6. Oakland: 10,300 jobs added to 1.2 million (No. 5).

7. Fresno: 8,500 jobs added to 392,900 (No. 9).

8. San Jose: 4,200 jobs added to 1.16 million (No. 7).

9. Bakersfield: 4,200 jobs added to 294,000 (No. 11).

10. Modesto: 3,500 jobs added to 194,600 (No. 14).

And there was a clear last place – San Francisco. It lost 11,400 jobs last year, shrinking to 1.17 million, the state’s No. 6 job market. It was the only job losers among 29 markets tracked.

By the way, if you’re looking for top job growth on a percentage basis, tiny El Centro led California in 2023 with 3.2% more workers. But that’s only 1,800 new jobs, bringing the agriculture-rich border town’s employment to 59,000.

The last time California ranked 51st for job growth before 2023 was the year Bill Clinton was sworn in as president, Beanie Babies were introduced, the first “Jurassic Park” hit the big screen, and Whitney Houston’s “I Will Always Love You” was No. 1 on the charts.

Yes, 1993 was a long time ago.

My trusty spreadsheet – looking at revised employment stats for California, 49 other states, and the District of Columbia from the Bureau of Labor Statistics – found the Golden State bosses adding workers at a 0.87% rate in 2023.

While any job growth is good, that hiring pace looked meager in an otherwise strong US labor market. California’s hiring pace also was less than half the 2% rate nationally. Second-slowest was D.C. at 0.91%.

Please note, the fastest job growth was happening in key economic rival states. Nevada and Florida gained 3.4% and Texas rose by 3.3%.

California’s economy juggled numerous challenges in 2023, including a weakening technology sector, labor unrest making it the nation’s strike hub, and population outflow – which created a shortage of workers to hire. There’s no doubt the state’s reputation as a tough place to do business doesn’t help.

Some California industries are in reverse gear. State jobs stats show noteworthy job cuts in the movie business, off 25% – major strikes all but shut production; at temp agencies, off 14% – drops common when hiring slows; lending, off 9% – rising rates slashed borrowing; and at warehouses, off 5% – online shopping has cooled.

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And geographically speaking, some of California’s biggest job markets were weak: San Francisco jobs fell by 1% while employment grew only 0.3% in Los Angeles County and rose 0.4% around San Jose.

But tumbling to the bottom of the hiring rankings isn’t California’s style.

Remember 1993? When a California house cost $190,000, L.A.’s Metro subway opened, and the first PDF documents were created.

Looking back over 50 years, that year was the only other time that California was the worst state for job growth. The state’s job count shrank by 1% in 1993 largely due to a major loss of aerospace work and the fallout from a real estate crash.

Think about who’s been No. 51 in hiring more often since 1974: DC (6 times), Michigan (5 times), Alaska and West Virginia (4), and Louisiana, New York, North Dakota, and Wyoming (3).

One year earlier

It’s a swift reversal for California.

In 2022, coming off some of the nation’s tightest pandemic business limitations, jobs grew statewide by 5.5% – the fourth-best increase among the states. But replacing all the jobs lost during the coronavirus economic chill ended abruptly.

California’s 4.6-percentage-point drop in hiring pace between these two years was exceeded only by Nevada’s 4.9 dip. Nationally, job growth was off, too,  but only by 1.6 percentage points.

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Now over the years California has been more likely to be a hiring leader than laggard.

Last year was the state’s seventh year in the bottom 10 in the past half-century, ranking it No. 26 among the states for bad job markets. The states earning this dubious distinction most often were West Virginia (25 times), then Connecticut (22), Pennsylvania and Rhode Island (20), and DC and New Jersey (19).

But 2022 was California’s 13th year in the top 10 for hiring. But that’s not nearly a national high.

Nevada’s been in the top 10 in 38 of these 50 years. Next comes Arizona and Florida with 33 years, Idaho at 30, Utah at 29, and Texas at 26.

Bottom line

Yes, California – the nation’s largest job market – has consistently outperformed most states.

Over 50 years, California’s 1.8% average annual growth ranks No. 19 and beats the 1.5% national pace. Tops? Nevada at 3.8%, Arizona at 3.1%, Utah at 2.9%, Florida at 2.6%, and Idaho and Texas at 2.5%.

And even over the last 10 years, the state has been above average. California ranked No. 14 with 1.7% job growth vs. 0.9% nationally. Tops? Utah, Idaho and Nevada at 2.9%, Florida at 2.6%, Arizona at 2.4%, and  Texas at 2.2%.

However, last year’s sluggish hiring pace should be a wake-up call to state leaders – political, business and labor – that California cannot take its long-running job-creation success for granted.

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California is a pricey place to live and do business and there’s plenty of lower-cost, high-quality competition that have proven to be viable options for bosses and workers.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

“Numerology” tries to find reality within various measurements of economic and real estate trends.

Buzz: What if homeowners are simply not selling because they like their homes?

Source: My trusty spreadsheet reviewed home transaction data from Attom tracking last year’s sales by length of ownership, price sold, and profits – the difference between sale and purchase price. The focus was on the 50 most-populated metro areas, including eight California markets.

Fuzzy math: The home-selling industry seems quite upset that homeowners aren’t moving like they once did. Ownership lengths have essentially doubled in the past two decades, and transaction levels tumbled to historic lows in 2023.

Topline

Last year’s sellers in these big California metros owned for an average 10.6 years – up from 9.8 in pre-pandemic 2019 and 5.5 in 2003. That’s ownership duration that grew by eight months in 4 years and was 5.1 years longer over 20 years.

And the typical seller was cashing in on some handsome profits: a $747,500 home with a $311,000 gain.

So you see, the growing length of ownership was happening long before historically cheap mortgages. It’s a similar tale nationwide.

Homes sold in the 42 big metros outside the Golden State had been owned for 8.4 years in 2023 vs. 8.2 in 2019 and 3.7 in 2000. That’s two months more over four years and 4.7 years longer over 20. Last year’s typical US seller moved from a $375,000 home with a $174,000 gain.

Bottom line

The why of this all is largely a lot of guesswork.

Some real estate gurus suggest that owners with low-rate mortgages are unwilling to part with their financing bargains obtained in the heat of the pandemic era’s stimulus boom. But conversely, many owners can’t afford to buy anything else – as the sharp rebound in mortgage rates and soaring prices slashed affordability.

Also, selling is quite the hassle – and it’s expensive. Paying for various transaction services – never mind the move itself – can cost 10% or more of the purchase price. And some ownerships have been so profitable, there are capital gains taxes to consider, too.

Plus, there’s that pride of ownership that comes with lengthy stays. If you’ve owned a home for a decade or more – you’ve likely upgraded it. So you’ve got financial and emotional ties to the place.

So, I’m willing to bet that the current state of the market – a meager number of homes for sale and limited transactions – becomes something of a new norm.

Barring some dramatic economic or real estate upheaval – not to mention, death, divorce or debts – many folks have gotten very comfortable in their current residence.

They’re NOT moving!

Locally speaking

Ponder the eight big California metros among the nation’s Top 50 and how the ownership longevity of last year’s sellers stacks up, ranked by ownership duration of 2023 sellers. The Bay Area saw numerous long-time owners cashing out …

San Francisco: Owned 11.9 years – sixth-highest of the 50 – vs. 10.5 years in pre-pandemic 2019 and 5.7 in 2003. That’s 1.4 more in 4 years (the biggest increase) and 6.2 longer ownership over 20 years, No. 6. Last year’s seller had a $1.01 million home with a $460,000 gain.

San Jose: 11.7 years – No. 7 – vs. 10.5 in 2019 and 5.7 in 2003. That’s 1.2 years more in 4 years (No. 3) and 6 years longer over 20, No. 8. Last year’s seller: $1.4 million home with a $755,000 gain.

Fresno: 10.9 years – No. 8 – vs. 10.1 in 2019 and 6.1 in 2003. That’s 10 months more in 4 years (No. 6) and 4.7 years longer over 20, No. 22. Last year’s seller: $380,000 home with a $110,500 gain.

Los Angeles-Orange County: 10.2 years – No. 13 – vs. 10.1 in 2019 and 5.5 in 2003. That’s 1 month more in 4 years (No. 29) and 4.8 longer over 20, No. 21. Last year’s seller: $880,000 home with a $380,000.

San Diego: 10.3 years – No. 12 – vs. 9.9 in 2019 and 5.4 in 2003. That’s 6 months more in 4 years (No. 15) and 5 years longer over 20, No. 18. Last year’s seller: $830,000 home with a $330,000.

Sacramento:  10.5 years – No. 11 – vs. 9.3 in 2019 and 5.2 in 2003. That’s 1.1 years more in 4 years (No. 4) and 5.3 years longer over 20, No. 15. Last year’s seller: $545,000 home with a $160,000 gain.

Inland Empire: 9.6 years – No. 16 – vs. 9.3 in 2019 and 5.4 in 2003. That’s 4 months more in 4 years (No. 23) and 4.2 years longer over 20, No. 35. Last year’s seller: $540,000 home with a $190,000 gain.

Bakersfield: 9.4 years – No. 17 – vs. 9 in 2019 and 5.1 in 2000. That’s 5 months more in 4 years (No. 17) and 4.3 years longer over 20, No. 33. Last year’s seller: $330,000 home with a $105,000 gain.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

The paycheck of a typical California woman with a full-time job is, relatively speaking, fairly close to what a man makes and it’s significantly more generous than the national norm.

As Equal Pay Day approaches – circle March 12 on your calendar – my trusty spreadsheet reviewed pay stats collected by Chamber of Commerce, a website for new businesses. The median income data for 2022 tracked full-time workers in the 50 states and 170 big US cities, including 38 from California.

Yes, California women earned 11% less than men, by this math. But only Vermont’s 10.5% gap was smaller. After California came New York at 12%, then Arizona and Nevada at 13%.

The biggest gap was in Utah at 27%, then Louisiana, Alabama and New Hampshire at 25%. And California’s economic rivals? Texas was No. 34 with a 20% gap; Florida was No. 12 at 15%.

This gender pay gap exists for numerous reasons – such as differing occupation choices (women tend to work in lower-paying fields) to the career challenges created within families (housework and childcare are burdens typically held by women) to, yes, bias in promotions and unfair pay patterns.

A key reason California’s pay gap is small is because its full-time working women get paid well above what other U.S. women make.

California women had the seventh-highest pay among the states at $59,420 – 16% above $51,275 earned nationally. Incomes ranged from Massachusetts at $67,043 to Mississippi at $39,245. Texas was No. 28 at $48,120 and Florida, No. 35 at $45,855.

California men ranked No. 12 at $66,916 – 7% above $62,344 paid nationally. Massachusetts was the highest at $79,782 and Mississippi was the lowest at $51,041. Texas was No. 26 at $60,004 and Florida, No. 45 at $54,157.

No easy measurement

This pay gap spurs lots of debate ranging from “why?” to “how to fix it?” and “does it even exist?”

It’s not simple math. Ponder some wage gap extremes in California among the state’s most populous cities.

Los Angeles had the smallest wage gap statewide in 2022. The thin 0.4% difference is the sixth-smallest divide nationwide. That came from a $56,657 median income for Los Angeles full-time working women (No. 45 highest of 170 U.S. cities) vs. $56,862 for men (No. 90 nationally).

Compare that to Irvine with the widest wage gap at 27% gap (the 11th largest of the 170 U.S. cities tracked). But think about the hefty size of Irvine paychecks – $89,093 for women (No. 5 nationally) vs. $121,349 for men (No. 3 nationally).

To the north, there’s Fresno with a 6% gap (No. 15 nationally) – $48,878 for women (No. 85) vs. $51,936 for men (No. 122) – vs. San Jose’s 20% gap (No. 127) – $75,508 for women (No. 10) vs. $94,350 for men (No. 18).

Los Angeles and Fresno, mathematically speaking, have better pay balance. But Irvine and San Jose clearly offer far better pay.

So depending on the point of view, answering “where do women fare better?” can be tricky.

Bottom line

No matter how the gap has come to be, at a minimum, it highlights added economic vulnerabilities for many women.

For example: 12.5% of U.S. women lived in poverty in 2022 vs. 10.5% of men.

The good news is that this pay divide is shrinking. Why? The answers range from greater numbers of women entering more-lucrative occupations, to above-average pay hikes in several women-dominated fields, to, yes, numerous employers weeding out unfair pay patterns.

Think about the upcoming Equal Pay Day, which its founder, the National Committee on Pay Equity, says “symbolizes how far into the year women must work to earn what men earned in the previous year.”

So, 2022’s national wage gap means a typical woman with a full-time job theoretically had to work a full year plus almost three months (January to March 12) – to earn what a man did.

Historically speaking, this is the shortest span on record. Look at how the pay gap has narrowed, by this measurement.

My spreadsheet tells me in 2002, the wage gap was erased by April 22. In 1982, August 15 was equality day. And in 1972, it was Sept. 23.

Locally speaking

Look at the wage gaps in eight other big California cities for 2022 and how it compared to 170 other US cities …

Long Beach: 4% gap (No. 9) – $57,556 for women (No. 42) vs. $59,733 for men (No. 73)

Oakland: 8% gap (No. 24) – $75,982 for women (No. 9) vs. $82,299 for men (No. 18)

Anaheim: 12% gap (No. 55) – $45,695 for women (No. 114) vs. $51,730 for men (No. 124)

San Diego: 13% gap (No. 69) – $64,986 for women (No. 21) vs. $74,586 for men (No. 29)

Sacramento: 14% gap (No. 81) – $54,554 for women (No. 48) vs. $63,279 for men (No. 54)

Riverside: 16% gap (No. 96) – $45,432 for women (No. 114) vs. $53,988 for men (No. 106)

San Francisco: 17% gap (No. 105) – $100,175 for women (No. 3) vs. $120,237 for men (No. 9)

Bakersfield: 19% gap (No. 121) – $43,536 for women (No. 121) vs. $53,908 for men (No. 108)

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

“Numerology” tries to find reality within various measurements of economic and real estate trends.

Buzz: Just 258,000 California houses sold last year – the lowest sales count since the Great Recession ended. Meanwhile, Californians gobbled up 1.78 million vehicle sales, the sixth-best year since 2009.

Source: My trusty spreadsheet looked at single-family house sales (from the California Association of Realtors) vs. purchases of new cars and light trucks (from the California New Car Dealers Association) dating back to 2009.

Fuzzy math: You’d think California sales patterns would be somewhat in sync for two of the largest transactions a household makes.

Topline

Both house hunters and car shoppers need significant financial oomph to close the deal.

Both transactions also require a solid economy and a decent amount of consumer confidence.

But in six of the last 14 years, home purchases and car sales ran in opposite directions. How can this be?

The scoop

We know that homebuying thrives when interest rates are falling, considering California housing’s lofty price tags and 30-year financings.

But car financing is shorter-term, typically over five years, so interest rates are not as big of a consideration.

Consider this example of typical monthly payments.

In 2019, the median-priced $607,000 California house at the average 3.9%, 30-year rate had a $2,290 monthly payment. Last year, houses were 37% pricier at $833,000 with rates that jumped to 7.4%. That created a $4,614 typical payment – up 101% in four years.

Compare that with new cars. In 2019, the average $40,000 new car at a 4.6%, five-year rate had a $748 payment. Last year, cars were 23% pricier at $49,000 – with 7.7% rates – for a $987 payment. That’s up just 32% in four years.

Bottom line

Yes, California’s home sales last year suffered from few owners willing to sell as auto dealers had their first decent inventory since coronavirus broke the supply chain.

But a longer-term view shows these two purchases often dance to different economic drums.

Interest rates – homebuying’s juice – tend to fall when the economy weakens. Yet a strong job market – fuel for car sales and higher interest rates – creates demand for transportation to get to work.

So ponder California’s best five years for these major purchases since 2009, as defined by yearly percentage gains in sales, and how the economy performed.

In homebuying’s hottest years, on average, we saw: Statewide unemployment was flat, California’s consumer confidence as measured by the Conference Board was up 7% – and the Fed Funds rate (controlled by the Federal Reserve) was down 0.4 percentage points.

Contrast that with car buying’s top times: California’s unemployment rate was down by 0.6 percentage points, consumer confidence was up 12% – and the Fed Funds rose 0.7 percentage points.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

The pain: California has three of the nation’s toughest spots to be an apartment hunter.

The source: RentCafe takes regular looks at a big renter challenge: finding vacant units to consider. The apartment listing service rates big rental markets on their “competitiveness” based on Yardi Matrix stats for apartment complexes. Those stats include vacancy rates, how long units remain empty, how many prospective renters view an apartment and how many current tenants renew their leases.

The pinch

Orange County was California’s hardest place to find a rental in early 2024. Apartment seekers were faced with complexes nearly full (96%) with the average vacancies lasting 40 days and getting 11 looks. And 60% of OC tenants stay put and sign a new lease. A year ago, OC ranked No. 2 statewide.

On a national scale, Orange County was the 11th-toughest market to find a rental, according to the study.

Last year’s No. 1 market, San Diego, fell to No. 2. It was 95% full, with vacancies lasting 38 days and getting 9 looks as 50% of tenants renewed. It ranked No. 18 nationally.

The third-toughest California market was Silicon Valley, up from fifth in 2023. Its units are 94% full, with vacancies lasting 37 days getting nine looks as 47% of tenants renew. It ranked 20th most competitive in the U.S.

By the way, the five most competitive US markets were Miami, Milwaukee, North New Jersey, suburban Chicago and Grand Rapids, Mich.

Pressure points

Other California markets tracked, ranked by 2024 competitiveness …

No. 4 Eastern Los Angeles County: 96% full; vacancies lasting 43 days getting 14 looks as 48% tenants renew. Year ago? No. 4.

No. 5 Central Valley: 96% full; vacancies last 40 days, get 8 looks as 53% renew. Year ago? No. 7.

No. 6 Central Coast: 97% full; vacancies last 40 days, get 9 looks as 46% renew. Year ago? No. 3.

No. 7 Sacramento: 95% full; vacancies last 44 days, get 8 looks as 52% renew. Year ago? No. 9.

No. 8 North LA/Ventura County: 95% full, vacancies last 46 days, get 9 looks as 48% renew. Year ago? No. 8.

No. 9 San Francisco Peninsula /North Bay: 93% full; vacancies last 42 days, get 6 looks as 45% renew. Year ago? No. 12.

No. 10 Inland Empire: 94% full; vacancies last 48 days, get 9 looks as 51% renew. Year ago? No. 6.

No. 11 Western Los Angeles County: 93% full; vacancies last 43 days, get 8 looks as 38% renew. Year ago? No. 10.

No. 12 East Bay: 94% full; vacancies last 43 days, get 7 looks, as 45% renew. Year ago? No. 11.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

In an era when clean public transportation has seemingly huge support, how can the makers of low-emission buses fail?

The latest casualty is a Southern California factory where environmentally friendly buses were made. It’s being shut down by its Wisconsin-based owners.

REV Group – which makes everything from RVs to fire trucks – decided in January to exit the mass transit business, announcing the closure of its ENC bus business and its plant in Jurupa Valley. State documents show 425 jobs will be lost after the business winds down after completing outstanding orders.

Now, you probably don’t know ENC, but you’ve likely ridden in one of their products. Their legacy product was the ubiquitous airport shuttle. The manufacturer then evolved into manufacturing mass-transit buses.

LA Metro runs 295 of ENC’s natural gas-fueled vehicles. San Francisco Municipal Transportation Agency has 30 electric-hybrid mini-buses. And just last year, Foothill Transit – serving riders around Pomona – ordered 19 electric ENC buses.

The company blames a slew of challenges for the factory shuttering.

“Delays in the supply of critical components and the build out of infrastructure to support EV adoption, as well as the financial health of key suppliers, has created a competitive bidding environment for diesel and CNG buses that has made it difficult for ENC to compete profitably versus peers of greater scale,” REV CEO Mark Skonieczny said in a statement. “The decision to wind down operations was not made lightly; however, based on the options available to us, we believe this is the best path forward for our business.”

Rough road

Clean-running buses ride along with plenty of government cash.

There were 6,147 electric buses in use nationwide in September 2023, up 85% in two years, according to CalStart. And California has 1,946 – nearly one-third of the national fleet.

Yet the road to business success seems rough.

Each transit district requires distinct specifications for what they buy, and that is no easy chore.

Like all vehicle makers, supply chain disruptions have become routine. And for green-vehicle makers, the parts shortage is especially problematic.

Also, like most businesses, the costs of doing business has soared – a big problem in an industry where companies bid for contracts that take years to execute.

Plus, mass transit in the post-pandemic world is by no means a growth business, as more workers do their jobs at home to avoid commutes.

The electric-bus industry heavyweight – Proterra, based in Burlingame – went bankrupt last year. Apparently, the logistics and costs of making small orders for numerous transit districts proved too daunting.

Now, the green bus niche could find comfort in the swift resolution to Proterra’s bankruptcy. The sale of its assets was so quick, there’s clearly value left, even in pieces.

Bus maker Phoenix Motor picked up the remains of Proterra’s manufacturing. Its battery business – a supplier to ENC — was bought by Volvo Group, the giant Swedish vehicle maker. And the electric chargers went to Cowen, a sustainable technology investor.

Long path to closure

ENC’s roots date to National Coach, a classic California entrepreneurial tale.

The founders in 1975 saw a need for what’s become a common item – airport shuttles that run travelers to rental car parking lots. Many of those vehicles were built at a new factory in Chino, which opened in 1984.

Of course, like many Golden State business tales, it also had an exit strategy: The company was sold to RV maker Thor Industries in 1991.

This is where the ENC lineage gets a tad complicated.

Thor combined National Coach with its other bus business, ElDorado Motor in Kansas. National Coach was rebranded ElDorado National-California – eventually “ENC” – and would focus on bigger shuttle buses.

A decade later, ENC expanded into heavy-duty buses for public transit systems. It opened a 200,000-square-foot factory in Jurupa Valley in 2003. The facility even had a test track on its 17-acre campus.

But in 2013, Thor sold its bus business, including ENC, to what’s known today as REV Group. Clearly, that didn’t work out.

Seven years later, REV Group sold off the Kansas operations – makers of those shuttles.

And now the California slice is being wound down.

Little green in green

Green transportation has its own green problem – profitability.

It’s not just the bus world. Makers of both consumer cars and commercial trucks are finding the niche challenging. That’s true of the industry’s startups as well as established fossil-fuel automakers, who are paying catch-up.

Look, Americans bought a record 1.5 million electric-powered vehicles last year. But the rush to enter this niche has created intense competition. And now you’re seeing fallout, with manufacturers trimming or retooling plans – or simply quitting.

GM, Ford and Mercedes has downgraded electric car aspirations. Industry giant Tesla has aggressively cut its prices. And newbie Lucid has disappointing sales.

E-truck maker Lordstown is just emerging from a bankruptcy. Another new truck manufacturer, Irvine-based Rivian, just had another round of layoffs.

So, clearly, the early euphoria of various vehicles powered by alternative fuels is over.

Yes, the novel thinking has gained mainstream acceptance. And new ideas still pop up. For example, a New Zealand maker of autonomous electric shuttles, Ohmio, is creating a US headquarters in Riverside.

But now comes the heavy lifting of making green transportation more broadly economically sustainable.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

“Swift swings” takes a quick peek at one economic trend.

The number: Permits for new California housing dipped slightly in 2023 – but it was still better than the national norm.

The source: My trusty spreadsheet looked at the National Association of Home Builders’ tally of housing permits last year, comparing that with 2022 for all US states and the District of Columbia.

Quick analysis: California builders filed 111,221 permits last year (No. 3 among the states). That was off 6% from 2022 – but that dip was still the 16th-best performance nationally.

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Of those California permits, 57,959 were for single-family houses (No. 4 nationally) – off 8% in a year (No. 31). California multifamily permits totaled 53,262 (No. 3) – off 3% (No. 16).

Elsewhere in the US, 1.26 million permits were pulled in the 49 states and D.C. That’s off 11%. Just nine states had increases.

Single-family permits were 851,268, off 6%. Only six states were up for the year.

Multifamily permits totaled 508,107, off 19%, with 15 states having increased filings.

Bottom line

Developers often complain that homebuilding is frequently limited by bureaucratic hurdles. But 2023 was far more about a cloudy economic outlook, a mortgage rates jump, and fears that too many apartments were being built.

Note that last year’s California permits equaled 2.8 per 1,000 residents, the lowest ratio since 2020. Yet, it’s also above the average 2.2 permits per 1,000 residents pace since 2008.

Remember, the Great Recession changed how builders build. From 1990 to 2007, California permitting averaged 4 per 1,000.

Locally speaking

Here’s how California’s biggest homebuilding markets fared within the nation’s 100 most-active metropolitan areas for permitting. Ponder the geographic divide, with southern metros having a combined 6% increase in permits vs. a 10% drop to the north …

Los Angeles-Orange County: 30,691 overall permits in 2023 (No. 7 of 100) – off 6% vs. 2022 (No. 46 change of the 100). Single-family houses? 11,810 permits (No. 14) – up 7% (No. 10). Multifamily? 18,881 permits (No. 5) – off 13% (No. 50).

Inland Empire: 19,710 overall (No. 17) – up 21% (No. 11). Houses? 11,924 (No. 13) – off 2% (No. 39). Multifamily? 7,786 (No. 20) – up 89% (No. 10).

Sacramento: 11,917 overall (No. 29) – up 11% (No. 15). Houses? 7,941 (No. 24) – off 2% (No. 41). Multifamily? 3,976 (No. 35) – up 54% (No. 14).

San Diego: 11,468 overall (No. 30) – up 21% (No. 10). Houses? 3,048 (No. 66) – off 13% (No. 75). Multifamily? 8,420 (No. 18) – up 42% (No. 15).

San Francisco: 7,478 overall (No. 39) – off 32% (No. 93). Houses? 3,037 (No. 67) – off 6% (No. 52). Multifamily? 4,441 (No. 32) – off 43% (No. 81).

San Jose: 6,288 overall (No. 51) – off 7% (No. 51). Houses? 2,200 (No. 89) – off 40% (worst of the 100). Multifamily? 4,088 (No. 33) – up 32% (No. 17).

Fresno: 3,223 overall (No. 90) – off 12% (No. 62). Houses? 2,398 (No. 85) – off 17% (No. 90). Multifamily? 825 (No. 83) – up 5% (No. 31).

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

A growing number of Californians – and fellow Americans – are having some trouble paying their bills.

If you want to see evidence of a slowing economy that’s taxing some consumers, look at a quarterly report from the Federal Reserve Bank of New York that digs inside credit histories from Equifax. My trustee spreadsheet looked at the fourth-quarter results for California, the nation overall, and the state’s two economic rivals – Texas and Florida.

Consider bills that are 90 days late or more. In California, 1.23% of consumers with credit histories have missed payments, up 0.22 percentage points in a year. It’s also the highest level in a year and a half.

Still, delinquent California debts are below the 2.1% rate found at year-end 2019 – a benchmark for let’s say “normal” pre-pandemic economic conditions.

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And Californians are better at bill-paying than elsewhere in the nation, where 1.74% of US bills were skipped – up 0.22 percentage points in a year.

Florida was at 2.58% up 0.6 points in a year. Texas had 2.42% late payers, up 0.29 points in a year.

Clearly, the Federal Reserve’s attempts to cool the economy and its problematic inflation smacks numerous household budgets. Higher interest rates – especially on shorter-term debts like credit cards and auto loans – are painful to many family’s checkbooks. Pricey mortgages simply crashed the homebuying pace.

Yet, we see that few bill problems are severe. California bankruptcies run 32 per 10,000 consumers, vs. 54 at year-end 2019. That’s below the nation’s 40 per 10,000 and Florida’s 37. Texas is at 27.

The important thing to know is that this increase in tardy payments is a bounce up from a mid-pandemic low when consumers were stuck at home and not spending much money, plus many people got various government stimulus checks. Comparisons to 2019 provide a scale for this late-payment upswing.

Mortgage moderation

Now you can’t chat about bills without thinking about mortgages. That’s a bit of PTSD from the bubble-bursting Great Recession of two decades ago.

Again, delinquencies are up, but still below the days before coronavirus.

In California, 0.36% of mortgages were 90 days or more late. Yes, that’s doubled in a year and the highest level in seven quarters. Still, this is less than half of the Golden State’s 0.8% tardy mortgages at year-end 2019 as well as better than elsewhere in the US.

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Nationally, there was 0.57% delinquency rate, up 0.14 percentage points in a year.  Florida’s at 1.07% late – up 0.68 points in a year. Texas had 0.66% slow payers, up 0.31 points.

And the worst-case scenario – foreclosures – is up but remains negligible.

California had 10 foreclosures per 10,000 home loans – up in a year but well under 17 seen at year-end 2019. Nationally, 14 per 10,000 – up 2. Florida’s 15 per 10,000 was up 5. And Texas’ 12 was up 2.

Pile of debts

Yes, California’s do carry a lot of debt – mainly the result of sky-high house prices. But growth is meek, which could be a sign of consumer skittishness.

Statewide, debts run $84,960 per person – 81% tied to mortgages – the ninth-highest level in data dating to 2003. It’s up a barely noticeable 0.1% in a year and up 17% since 2019.

Nationally, debts are only $61,039 per capita – one-third less than the Golden State’s pile – but that’s a record high and an 1.9% increase in a year and up 18% since 2019.

Florida is at a record $60,040 – up 5.2% in a year and 27% since 2019. Texas hit a record, too, at $56,890 – up 3.4% in a year and up 26% since 2019.

Bottom line

As of the end of 2023, there was no epidemic of financially swamped households.

That’s not dismissive of real economic pain for many families. It’s simply what these broad debt figures show.

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A key reason is the job market is cooler but still worker-friendly on a historic scale. And paychecks for many workers have grown near the pace of inflation.

Think about California’s unemployment rate at 4.6% for all of last year. Yes, that’s up from 4.2% in 2022, but did you known joblessness averaged 7% statewide during the previous three decades?

And California is by no means alone with historically low unemployment.

Last year’s national jobless rate of 3.2% is nearly half of 6% seen in 1980-2019. Florida at 2.7% and Texas at 4.1% are both well below each state’s three-decade rate of 6%.

So, please don’t ignore slow payers. Growing late payments must be watched closely as the bumpy economy evolves.

Just take it in with a shot of perspective.