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Post-holiday slowdown hits logistics and retail while health care drives annual growth
REDLANDS, Calif. — The Inland Empire labor market is off to a rough start in 2026, losing 23,600 jobs in January as the unemployment rate climbed to 5.4%, according to new data from California’s Employment Development Department.
The rate is up from a revised 5.1% in December and slightly higher than 5.3% a year ago. It remains just below California’s 5.5% unemployment rate but above the national average of 4.7%.
Why it matters: The Inland Empire is a key logistics hub for Southern California, and shifts in warehousing and transportation jobs often reflect broader changes in consumer demand. While some January losses are seasonal, the region’s reliance on these industries makes it especially sensitive to slowdowns.
Long-term economic growth continues to be driven by health care and social assistance, mirroring statewide and national trends as demand for medical services rises.
The region’s largest employment sector—trade, transportation, and utilities—accounted for the bulk of January’s losses, shedding 17,200 jobs.
Transportation and warehousing led the decline, down 9,300 jobs, followed by retail trade, which dropped by 7,500 jobs. Wholesale trade also slipped slightly.
Professional and business services lost another 3,600 jobs, with most cuts concentrated in administrative and support roles.
Construction (-1,300 jobs) and manufacturing (-300 jobs) also declined.
A handful of sectors posted modest increases.
Government employment rose by 100 jobs, driven by gains at the local level. Leisure and hospitality and other services each added 100 jobs, while mining and logging remained unchanged.
Despite the steep monthly losses, the Inland Empire added 15,100 jobs compared to January 2025, a 0.9% increase.
Private education and health services led that growth, adding 27,000 jobs. Nearly all of those gains came from health care and social assistance, which grew by 25,600 jobs.
Other sectors posting annual gains include other services (+1,300 jobs) and leisure and hospitality (+900 jobs).
Several key industries remain in decline year-over-year.
Construction saw the largest dip, down 5,300 jobs, with losses concentrated among specialty trade contractors. Professional and business services fell by 3,700 jobs, while manufacturing declined by 2,500.
The latest report reflects a labor market that remains stable over the long term but turbulent month to month.
January’s losses align with typical post-holiday slowdowns, but the scale of the decline highlights how reliant the Inland Empire is on those industries.
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