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Wednesday, July 9, 2025

Orange County Job Market Shrinks Amid Economic Slump

Orange County is showing signs of economic deceleration, according to a recent economic forecast forum co-hosted by the UCLA Anderson Forecast and the Merage School of Business at UC Irvine (UCI). At the event, Mark Schniepp, Director of California Forecast, stated that job recovery in Orange County is expected to remain sluggish through 2025, with most sectors either stagnating or declining in employment.

Courtesy of OC Vibe

Schniepp presented labor market data from the past two years. From March 2023 to March 2024, Orange County added about 20,000 jobs, but then lost 16,000 over the next 12 months, signaling a sharp drop. “While the entire state is experiencing slower job growth, the scale of decline in Orange County is unusually large,” he said.

Health Care, Tourism, and Government Remain Resilient

Some sectors are still growing, including health care, tourism, and government. Health care remains the most stable job creator, with multiple hospital projects underway. The UCI Medical Center currently under construction in Irvine is expected to be completed by the end of 2025, creating over 1,000 new jobs.

Tourism is also holding up. Local hotels are maintaining 70% to 80% occupancy rates, and Disneyland has even seen an increase in its average wait times, reaching 29 minutes, up from the previous year. However, international tourism remains a concern. In the first quarter of 2025, the number of Canadian visitors dropped by 12% year-over-year, and direct flights from China have plummeted from around 300 pre-pandemic to 83. Since Canadian visitors make up about 6% of Disneyland’s total foot traffic, further declines could significantly impact tourism revenue.

Manufacturing, Logistics, and Tech Underperform

Manufacturing, logistics, and tech sectors are struggling. Over the past three years, 6 million square feet of industrial space has been added to the county, but demand has not kept pace. As a result, the vacancy rate has exceeded 5%, with another 2.5 million square feet expected by late 2025. This imbalance is pushing rents down, and some companies are downsizing or relocating their logistics operations elsewhere.

The tech industry continues to stagnate. Employment in software and related tech roles has declined since late 2022, with companies increasingly adopting AI-driven code automation following the launch of ChatGPT. Traditional developer hiring has slowed, and overall, the tech sector in Orange County has shed more than 10,000 jobs, with only certain semiconductor manufacturing positions seeing growth.

Housing Market Remains Stagnant

The housing market has yet to rebound. The average home price in Orange County now approaches $1.5 million. Although new home sales are up 6%, they remain well below pre-pandemic levels. Inventory has grown 19% year-over-year, but high interest rates, supply chain issues, and uncertain material costs are making developers hesitant to break ground. While apartment construction is active, single-family home projects remain largely stalled.

Large-Scale Developments Offer Some Optimism

Despite the challenges, Schniepp noted that several large-scale projects could help stabilize the local economy. These include the Disneyland expansion, the OC Vibe cultural complex, new hotel developments in Dana Point, and massive residential projects in Irvine. “At present, these developments are the only meaningful drivers of job growth and capital investment in the region,” he said.

Schniepp concluded, “Orange County has long been considered one of California’s most stable economies, but this year is different. Job losses are likely to continue through the end of 2025, and any significant recovery in manufacturing or tech may not arrive until 2026 or later.”

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Wonhee Cho
Wonhee Cho
Wonhee Cho is a journalist covering tech and finance, but also writes about food, sports, entrepreneurship, travel, and real estate. Prior to joining the Korea Daily, he built his career in public relations, specializing in the gaming and technology sectors, where he developed a deep understanding of the industry landscape and media strategy.