Riverside County Jobless Rate Hits 5.9% in July on Payroll Losses

A summer jump in Riverside County unemployment

Riverside County's unemployment rate rose to just under 6% in July. Preliminary figures from the California Employment Development Department (EDD) put the countywide rate at 5.9%, up from 5.4% in June.12 Payroll losses in several sectors drove the increase, according to the state data.11 The rate for the whole Inland Empire, which combines Riverside and San Bernardino counties, rose from 5.3% to 5.7% over the same month.13

The monthly jump looks bad on its own, but the yearly comparison is better. The July rate was three-tenths of a point lower than in July 2025, when the county stood at 6.2%.12 San Bernardino County shows the same pattern. Its rate reached 5.5% in July, up from 5.2% in June and 4.6% in May, but it was still below the 6.0% recorded a year earlier.5

The increase continued into late summer. In August the county rate rose again to 6.2%, and the Inland Empire rate reached 5.9%.19 Even so, August was one-tenth of a point below the same month a year earlier.19 Unemployment in the region has now risen month over month since spring and still sits slightly below 2025 levels.

Where the jobs went

Two reports from the same wire service describe July's losses with different emphasis. One version lists losses in agriculture, construction, hospitality and professional and business services, which together shed 4,600 jobs. It also lists gains in financial services, health services, information technology, manufacturing and warehousing, which together added 4,100 positions.12 Another version puts the public sector first. By that account, about 15,400 bi-county government positions disappeared, mostly in education, because campuses are quiet in summer.13

EDD's own industry table supports the public-sector explanation. Government employment in the Riverside–San Bernardino–Ontario metro area fell from 266,200 in June to 250,800 in July. Local government education jobs dropped from 130,300 to 115,300.15 Those positions partly came back in August, when local government education employment rose by 3,300.15

On this reading, much of July's increase reflects the school calendar rather than a sudden break in the regional economy. A seasonally adjusted series published by the Federal Reserve Bank of St. Louis supports that view. It shows the metro area's smoothed unemployment rate at 5.2% in both June and July, slightly below the 5.4% recorded in March and April.16 The unadjusted figures that drive local headlines exaggerate the summer rise.

The seasonal story does not explain everything. Over the year to August, professional and business services lost 5,700 jobs in the metro area, the biggest decline of any sector. Construction lost 4,600 and manufacturing lost 1,700.15 Health care and social assistance added 17,200 jobs over the same period and is doing most of the work holding the region up.15 Healthcare added more than 18,000 jobs across the Inland Empire in the 12 months to July.1

A falling rate that hides a shrinking workforce

The year-over-year improvement needs a closer look. The Inland Empire's civilian labor force shrank from 2,243,300 in August 2025 to 2,204,100 in August 2026. Over the same period, the number of employed residents fell by 1.5%.15 In San Bernardino County, employed residents dropped from 977,700 in July 2025 to 960,400 in July 2026, and the labor force fell by about 24,000.1

Taken together, these figures suggest that part of the yearly decline in unemployment comes from fewer people working or looking for work, not from more people finding jobs. That pattern matches the state as a whole. A UCLA Anderson forecast found that California's household survey showed 351,100 fewer people in the labor force over the 12 months to August, even as payroll employment grew modestly.30 A former EDD director has suggested that migration out of state and the federal crackdown on undocumented workers may be shrinking the workforce.24 In an agricultural and logistics region like the Inland Empire, that explanation is plausible, though not proven.

The pain is also uneven within Riverside County. Cherry Valley and Coachella both had July unemployment rates of 10.8%. Blythe followed at 10.6%, and March Air Reserve Base and Rancho Mirage each stood at 8.5%.11 By August, Coachella's rate had climbed to 12.8%.19 These desert and rural areas depend heavily on farm work and hospitality, and they have far higher unemployment than the county average.

Wage growth is not keeping up

Wages are the other weak spot. In the first quarter of 2026, California's average weekly wage was $1,986, the sixth-highest in the country and 20% above the national average.23 Wage growth was weak, however. Pay rose just 2.7% over the year, eighth-lowest among the states and well below the 3.9% national figure.25 National inflation also ran at 2.7% that quarter, so the typical California worker's raise was cancelled out by higher prices.25

This is a particular problem for the Inland Empire. The region has long relied on lower-wage service, warehousing and logistics jobs, and its high-tech and professional jobs pay less than similar work elsewhere in the state.8 Up to a third of working adults commute out of the region for work.8 When raises across the state only match inflation, a region that already starts with lower pay gains little ground. It also loses the professional-services jobs that paid better than the local average.

Tech layoffs: a coastal story with inland effects

The Inland Empire is not a tech hub, but the tech layoffs reshaping California still reach it. From January through May, U.S. tech employers announced 123,653 job cuts, 66% more than in the same period of 2025. California accounted for close to 77,000 announced cuts across all sectors, about double any other state.22 Companies have increasingly cited artificial intelligence as the reason for cuts. Large employers such as Meta, Oracle and Snap announced more reductions in the spring.24

Locally, the information sector is small and getting smaller. The metro area had 11,000 information jobs in August, down 9.8% from a year earlier.15 The sector added a few hundred jobs in July but lost positions again in August.1219 Professional, scientific and technical services, which includes much of what counts as tech work, fell by 1,700 jobs over the year.15

The statewide picture on layoffs is mixed, and the numbers depend on which measure is used. One analysis of state notices filed under the WARN layoff-warning law found that California's announced layoffs in 2026 were running 8% below the 2025 pace, with 11% fewer workers affected. Weekly unemployment claims were also down 7%.23 The same analysis found that California's job growth had beaten the rest of the country for nine straight months. It attributed much of that strength to an AI boom in the Bay Area.23

Both accounts can be true. Tech cuts are large, concentrated and widely reported, while overall job loss in California has eased. The UCLA forecasters describe a "bifurcated" economy split between AI, aerospace and related industries on one side and everything else on the other.30 The state economy grew at a 3.7% annual rate in the first quarter, but it added only 138,500 jobs in the 12 months to August.30

What it means for the region

The best reading of the July report is a seasonal increase on top of a slowly weakening job market. School-year job losses explain most of the monthly jump, and the seasonally adjusted rate shows little change.16 Underneath, the region is losing professional-services, construction and manufacturing jobs, its workforce is shrinking, and it depends heavily on healthcare hiring.15

Healthcare and social services have driven much of California's job growth this year, and the UCLA forecasters do not expect those sectors to stay as strong.30 They project a statewide unemployment rate averaging 5.2% this year and 4.9% next year. They also expect the AI investment wave to start producing job gains in 2027 and 2028.30

If those gains come, they will probably go first to the Bay Area and coastal aerospace centers. For Riverside County, the question is whether healthcare and logistics can keep absorbing workers while pay raises barely match inflation. The August increase to 6.2% suggests the region has not yet recovered.19