The mix of jobs in a metropolitan area has significant impacts on the local apartment market. For this reason, MPF Research has identified five U.S. metros that have outsized exposure to certain industries. The data for these rankings were obtained via the Bureau of Labor Statistics as of March 2015. In this blog series, we’ll take a deeper look at the five metro areas and highlight unique characteristics that drive the employment makeup of each metro. We’ll also a few other “runner up” metros that also have outsized exposure these five employment industries.
Among the metros that have outsized exposure to certain industries is the Sacramento. Roughly 25.6% of Sacramento employees work in the Government industry. That percentage translates to 231,900 Government workers.
Within the Government sector, there are three subsectors: Federal Government, State Government and Local Government. Since Sacramento is California’s state capital, the State Government industry contains the largest chunk of employees at 12.8%, followed closely by Local Government at 11.3%. Meanwhile, Federal Government only contains 1.5% of Sacramento’s employees.
It is pretty clear that Sacramento’s economy is dependent on government. In fact, a problem Sacramento has wrestled with has been its dependence on state government. California as a whole has struggled with funding issues and budgeting problems, which has affected spending and employment growth in the state’s capital city. However, over the past few years, California has made big progress in addressing some of these budgeting issues, facilitated by a recovering economy and increasing tax revenues. As a result, Sacramento’s total employment in the State Government subsector finally reached pre-recession levels in 2014’s 1st quarter. Since then, the subsector has gained another 2,900 jobs.
Looking at the 2015-2016 budget proposal, there are a few items that address budgeting issues and, in turn, will be a good thing for Sacramento. To see the 2014- 2015 proposal in its entirety, you can view it here.
- $151 billion in spending from the General Fund and Special Fund ($11 billion more than the revised 2013-2014 level)
- $2.3 billion reserve, $1.6 billion of which would be in the rainy-day reserve and $693 million in the General Fund’s traditional reserve
- By the year’s end, the state’s rainy day fund will have a total balance of $2.8 billion
- Continues to focus on paying down California’s “wall of debt”
- Pay down the remaining $1 billion in school and community colleges deferrals
- Make the last payment on the $15 billion in Economic Recovery Bonds
- Repay local governments $533 million in mandate reimbursements
- Plan for allocation of $850 million in cap-and-trade auction revenues
- $618 million for the state’s water challenges
- $815 million for deferred maintenance infrastructure projects
It’s clear that California is slowly getting its budgeting issues under control. And, as the state continues to recover from funding and budgeting problems, Sacramento’s government sector will continue to recover.