Fact Check: Gavin Newsom says California tops Florida in every economic category. Is it true?
Claim: Gov. Gavin Newsom called out Florida, “especially Florida,” as he concluded his appearance at the Nov. 9 California economic summit, saying California “continues to dominate in every category.”
Rating: Not true.
Details:
Newsom did offer several accurate statistics about areas where California has led the nation in recent months and years.
But there was data he did not mention. California is not dominating “every category.”
Among those economic areas where Florida outpaces California:
▪ Unemployment rate. Last month, California had the nation’s highest state unemployment rate. California’s unemployment rate has been consistently higher than the nation’s throughout 2021. Florida’s has been close to the national figure.
▪ Unemployment claims. California had over 21% of all of the nation’s initial unemployment claims last week, but has 11.7% of the nation’s civilian labor force. Florida has about 7% of the labor force and last week had 2.1% of the initial unemployment claims.
▪ Business climate. California ranked 48th in favorable business tax climate, according to a study by the Tax Foundation, a Washington research group, largely because of its higher taxes. Florida was 4th.
▪ State gross domestic product. While the value of the state’s goods and services is growing more rapidly this year than Florida, Florida grew at a faster pace last fall.
California’s seasonally adjusted November unemployment rate was 6.9%, the nation’s highest and well above the nation’s 4.2% rate. Florida’s rate was 4.5%.
The pattern has persisted. The state’s October unemployment rate was 7.3%, tied with Nevada for the highest in the country. The national rate was 4.6%, the same as Florida’s.
In September, California’s rate was 7.5%. Florida’s 4.8% rate matched the national figure.
Who’s got a higher unemployment rate?
California’s unemployment rate as the peak of the 2020 recession was 16% in April 2020.
Florida’s rate that month was 14.2%, so its plunge has been somewhat steeper.
Dee Dee Myers, Director of Newsom’s Office of Business and Economic Development, said there are longstanding structural reasons the state’s unemployment rate has been higher than average.
California is more dependent on tourism and agriculture, two areas affected by hard-to-control trends such as the COVID-19 pandemic and weather.
Whose economy is growing faster?
The state gross domestic product statistics have been a win for California this year, but less so last year.
Both states suffered the same magnitude of economic collapse during the second quarter of 2020, when the pandemic triggered a deep recession. The U.S. economy sank 31.4%. California’s dropped 31.4% and Florida, 31.1%.
As the economic comeback began, Florida grew nearly three times as fast as California in the fourth quarter of last year, 3.4% to 1.2%.
In 2021, California’s economy grew at an annualized rate of 11.7% in the first quarter of this year and 8.1% in the second quarter. That was well above Florida’s rate of 7.5% and 6.7%.
There are strong signs of growth in California. Personal income, for instance, grew at a 4.2% rate since the recession, the fastest growth in the United States. Florida was sixth at 2.8%. Both states were well above the nation’s 1.1%.
California vs. Florida
In a harbinger of the future, venture capital continues to pour into California. The Legislative Analyst’s Office cited “a recent surge” in funding through the fall of this year was “hitting a new high for the third straight quarter,” according to Crunchbase, a private data service.
Economists noted that it’s difficult to compare state economies, because each has its own unique set of challenges.
That’s why, said Amy Baker, chief economist for the Florida Department of Economic and Demographic Research, it’s best to look at unemployment and the gross state product, which provide broad measurements.
The job numbers, she said, “are pretty indicative of how fast you’re recovering.”
Her conclusion: “It means their economy isn’t doing as well as ours.”
This story was originally published December 20, 2021 at 8:00 AM with the headline "Fact Check: Gavin Newsom says California tops Florida in every economic category. Is it true?."
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