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Below are the monthly updates from the most current March 2020 fuel price data (GasBuddy.com) and January 2020 electricity and natural gas price data (US Energy Information Agency).
As with most other recent economic data releases, these numbers do not yet fully reflect the current economic conditions as they have been affected by emergency measures to combat the COVID-19 virus. They do, however, begin to reflect changes coming from another source of economic disruption, the collapse in world oil prices stemming initially from a battle within OPEC for market share between Saudi Arabia and Russia and now intensified by the sharp decline in economic activity coming from the emergency social distancing measures. While lower fuel prices will assist households and many employers in the short term, this price collapse in particular threatens continued operating viability and employment within higher leveraged independent producers, adding yet another source of uncertainty as the affected regions struggle to move to the economic recovery phase. Within
California, direct employment is led by Kern, Ventura, Santa Barbara, and Los Angeles Counties along with a broader range of counties with a much larger number of related jobs in refining, transportation, and support industries.
The most recent energy price data also shows the continuing rise in costs to both households and employers coming from the state’s energy regulations and policies, with commercial electricity prices now the 3rd highest in the nation and industrial prices the 5th highest. While these costs were a source of growing concern even during the positive economic trends existing prior to the current emergency, they now represent conditions unique to California that will impose additional barriers to the coming recovery period in our state. As many households and employers attempt to rebuild cash flows from what will essentially be a cold start, these regulatory costs will continue to divert a higher level of household incomes and business operating revenues than in other states. At the national level, various actions have begun to be made to reduce this added source of cost
uncertainty such as the US Environmental Protection Agency waiver of summer gasoline formulation requirements to avoid shortages in fuel supplies. In California, regulatory agencies have instead announced their intent to continue “proposing new and implementing existing regulations” even as many households struggle in the face of a growing cost of living.
To view additional data and analysis related to the California economy visit our website at http://www.centerforjobs.org/ca.
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