Los Angeles County saw job gains in May, likely driven in part by rebuilding after the January 2025 wildfires, which destroyed or damaged more than 18,000 structures.
Construction added 2,300 jobs since April, while postings for new jobs in the industry jumped 45% over a year ago —indicating rebuilding in Pacific Palisades, Altadena and nearby is helping boost the local economy, according to a report by the Los Angeles County Economic Development Corp.
“This is consistent with the possibility that wildfire rebuilding activity is increasing construction labor demand in the area,” Max Chomas, an economist at the LAEDC Institute for Applied Economics, said at a presentation this week based on California Employment Development Department and other data.
Motion picture and sound recordings also added 2,800 jobs during the month, despite a deep downturn in Hollywood caused by a reduction in streaming filming, runaway production and other factors. The industry lost 6,700 jobs compared with a year ago.
Still, the job growth since April in construction and Hollywood were among the highlights of a month that saw total county payroll jobs — excluding agriculture and certain other sectors — grow by 9,000 jobs, to 4,618,400. Employment was virtually flat from the same time a year ago.
“May was a relatively good month for employment growth,” Chomas said.
The biggest monthly job gainers were the hotel and restaurant industries, which added 3,700 jobs.
Manufacturing, which has been hit by job losses over recent years, added 400 jobs since April. It also saw a 15% increase in job postings compared with a year ago.
That could reflect the resurgence in Southern California’s aerospace and defense industries, which have seen a sharp rise in startups.
Postings for all new jobs were up 1,134, or 2.4%, since a year ago. Chomas noted that May was only one of five months over the last three years that saw year-over-year growth in job postings.
The gains helped stabilize the county’s unemployment rate at 5.2%, matching April’s rate and down from 5.4% in May 2025.
Still, that is higher than May’s 4.3% national unemployment rate, and it masked some weakness in the local economy.
The rate is calculated by a household survey to determine which members are working, looking for work or no longer seeking employment.
It found 18,000 workers had dropped out of the county labor force in May, artificially driving down the unemployment rate, according the California EDD.
Similarly, California recorded a 5.3% unemployment rate in May, on par with April, despite a drop in the labor force.
That rate is higher than every state other than Delaware. In May, California only added 3,100 non-farm jobs month-over-month — a job growth rate that lags behind the nation, according to an analysis by the Inland Empire Economic Partnership and the Lowe Institute of Political Economy at Claremont McKenna College.
The LAEDC’s report also examined the potential effects the growth in artificial intelligence has been having on L.A. County jobs “exposed” to AI, meaning they are vulnerable to AI replacement.
California has been hit hard by thousands of AI-related layoffs in Silicon Valley as the software has been integrated into the tech workplace — even though there is fierce competition for software engineers with skills and expertise in the field.
The report found that since July 2023, job listings in Los Angeles County for AI-exposed positions — such as clerical and translation positions — have lagged behind other jobs. However, it is unclear whether businesses have replaced or are waiting to replace those workers with AI.
It may be that employers overhired for those positions during the COVID-19 pandemic and are now shedding them, since there is a correlation between AI-exposed positions and those jobs that can be completed from home, Chomas said.
The report also examined macroeconomic trends and policy decisions affecting the national, state and Los Angeles County economies — which have been hit by tariffs, the crackdown on immigrant labor and high energy costs, among other factors.
Nevertheless, consumers continue to spend despite affordability strains, and employers continue to hire selectively amid higher interest rates to battle inflation, said institute economist Shannon Sedgwick.
“During the previous decade, we experienced extraordinarily low inflation, near zero interest rates, relatively stable globalization, and abundant capital. So those conditions may have conditioned us to think that environment was normal,” she said.
“But historically speaking, today’s world of higher rates, greater geopolitical uncertainty and tighter labor markets, they may actually be closer to that long-run average,” Sedgwick noted.
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