Greater Palm Springs ended 2025 with a welcome improvement in unemployment, as the regional jobless rate fell from 6.5% in November to 6.0% in December.
The drop matters, especially because it was broad. All nine cities in the Greater Palm Springs market posted a lower unemployment rate in December than in November, extending the region’s late-year rebound after the more stressed labor conditions seen during the summer and early fall.
But the new numbers also show a more nuanced reality beneath the headline. The valley’s labor market improved in December, yet it remained weaker than Riverside County, California and the United States. And the local improvement came even as total employment slipped, suggesting that some of the decline in unemployment reflected a smaller labor force as well as fewer people counted as unemployed.
In other words, December was better. It was not a clean breakout.
At the regional level, Greater Palm Springs had a labor force of 184,000 in December, down from 185,500 in November. Employment slipped from 173,600 to 173,000. The number of unemployed residents, however, fell more sharply, from 12,100 to 11,000, pulling the unemployment rate down by roughly half a percentage point to 6.0%.
That pattern is important. In a tourism-heavy regional economy like Greater Palm Springs, unemployment can improve for the right reason, meaning employers are adding jobs, or for a more mixed reason, meaning fewer people are actively in the labor force. December appears to include some of both dynamics, but the labor-force decline shows that the improvement was not simply a case of robust hiring across the board.
Still, the city-level data show undeniable progress.
Coachella continued to post the highest unemployment rate in the region, but even there, the number improved, falling from 9.9% in November to 9.3% in December. Rancho Mirage remained the second highest at 8.4%, down from 8.9%. At the other end of the spectrum, Indian Wells posted the valley’s lowest unemployment rate at 4.6%, improving from 4.9%, while Cathedral City dropped from 5.4% to 4.7%.
Some of the most notable monthly improvements came in places that strongly influence the valley’s overall employment picture. Indio fell from 6.3% to 5.7%. Palm Desert dropped from 5.9% to 5.3%. Palm Springs declined from 5.6% to 5.1%. La Quinta moved from 5.6% to 5.1%. Desert Hot Springs improved from 6.1% to 5.8%.
Cathedral City posted the largest month-to-month improvement, dropping 0.7 percent. Coachella, Indio and Palm Desert each improved by 0.6 points. Those are meaningful one-month moves, particularly for communities where seasonal shifts can strongly affect local hiring.
The broad nature of the improvement is one of the strongest takeaways in the December data. This was not one city skewing the valley-wide average. Every city improved.
Even so, December’s numbers reinforce a point that has become familiar in local labor market coverage: Greater Palm Springs is not a single, uniform economy. It is a cluster of connected but uneven local labor markets.
The east valley continues to carry higher employment stress, with Coachella still well above the regional average. Rancho Mirage remains unusually elevated relative to many of its neighbors. Meanwhile, Indian Wells and Cathedral City posted the lowest rates in December, showing how varied labor conditions can be across a relatively compact geographic region.
The benchmark comparisons are also telling.
Riverside County’s unemployment rate fell from 5.5% in November to 5.2% in December. California moved from 5.4% to 5.1% on the same not-seasonally-adjusted basis used in the local area data. The U.S. rate, also not seasonally adjusted, declined from 4.3% in November to 4.1% in December.
That means Greater Palm Springs remained above all three benchmarks in December. The valley’s 6.0% rate was 0.8 percentage points above Riverside County, 0.9 points above California and 1.9 points above the national rate.
Still, the gap narrowed modestly from November. That is a constructive sign as we headed into the winter season, when the valley always gets a lift from tourism, hospitality, events, retail activity and seasonal population increases.
Broader labor-market indicators add context to the local picture.
In California, the state’s seasonally adjusted unemployment rate edged down from 5.6% in November to 5.5% in December, even as employers shed 1,700 nonfarm payroll jobs in December after adding 32,500 in November. Nationally, the U.S. seasonally adjusted unemployment rate moved from 4.6% in November to 4.4% in December. U.S. employers added 64,000 jobs in November and 50,000 in December, pointing to a labor market that was still growing late in the year, but at a restrained pace.
That backdrop helps explain the local story. Greater Palm Springs improved in December, but it did so in an environment where hiring momentum nationally and statewide was hardly booming. The local gain looks less like a surge and more like a seasonal step forward in a labor market that remains structurally uneven.
For local business leaders, the December report offers both encouragement and caution.
The encouragement is straightforward. The valley closed the year in better shape than it was in November, and every city moved in the right direction. That is a positive signal for employers, workforce officials, elected leaders and anyone watching the health of the local economy.
The caution is that the improvement did not come with rising employment. Total employment dipped, and the labor force shrank. That means the local economy still has work to do before it can claim a stronger and more durable labor-market expansion.
So, the December message is not that Greater Palm Springs has solved its employment challenges. It is that the region regained some footing at year’s end, with progress visible across every city, even as the valley continues to run hotter than the county, the state and the nation on unemployment.
That is a better place to start 2026 than where the region stood a few months earlier. But it is also a reminder that in Greater Palm Springs, a lower unemployment rate does not always tell the whole story.
Source: CA Employment Development Department (EDD), Local Area Unemployment Statistics (not seasonally adjusted).
