Sacramento Jobs Slip as Unemployment Falls to 4.8%

Nonfarm payrolls drop even as jobless rate declines, pointing to workers leaving the labor force

Jan. 30, 2026 at 2:07pm

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Sacramento's unemployment rate fell to 4.8% in December, but the region also saw a drop in nonfarm payrolls and a shrinking labor force, indicating that the lower jobless figure may not reflect an entirely healthy job market.

Why it matters

The mixed jobs report for Sacramento highlights how a declining unemployment rate can sometimes mask underlying labor market weaknesses, as workers leaving the labor force can skew the headline figure. This is especially relevant as the region grapples with broader tech and office hiring slowdowns across Northern California.

The details

According to data from CoStar Analytics, Sacramento's unemployment rate dipped to 4.8% in December from a revised 5.1% in November, even as nonfarm payrolls slipped and the civilian labor force shrank. This combination of fewer jobs and a smaller labor force can make the lower jobless rate appear healthier than the actual underlying employment picture.

  • Sacramento's unemployment rate was 4.5% a year earlier in December 2025.
  • California's overall unemployment rate was 5.5% in December 2026.

The players

CoStar Analytics

A real estate data and analytics firm that highlighted the regional employment trends in Sacramento.

U.S. Bureau of Labor Statistics

The federal agency that publishes the state and metropolitan-area employment data referenced in the report.

California Employment Development Department

The state agency that releases detailed industry-level employment figures for California regions.

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What they’re saying

“When payrolls are down while the jobless rate also slips, it often means workers are leaving the labor market or pressing pause on their job searches rather than landing new positions in large numbers.”

— Joshua Ohl, Analyst, CoStar Analytics

What’s next

The California Employment Development Department is scheduled to release more detailed metropolitan-area employment data for December 2026 on February 4, which will provide a clearer picture of the industry-level trends driving Sacramento's mixed jobs report.

The takeaway

Sacramento's jobs report highlights how a declining unemployment rate can sometimes mask underlying labor market weaknesses, underscoring the importance of looking beyond headline figures to understand the full employment picture in a region.