Despite Better Unemployment Numbers, Job Sites See 'an Early Tsunami Warning' in Hiring Data

Sam Blake

Sam primarily covers entertainment and media for dot.LA. Previously he was Marjorie Deane Fellow at The Economist, where he wrote for the business and finance sections of the print edition. He has also worked at the XPRIZE Foundation, U.S. Government Accountability Office, KCRW, and MLB Advanced Media (now Disney Streaming Services). He holds an MBA from UCLA Anderson, an MPP from UCLA Luskin and a BA in History from University of Michigan. Email him at samblake@dot.LA and find him on Twitter @hisamblake

Despite Better Unemployment Numbers, Job Sites See 'an Early Tsunami Warning' in Hiring Data
  • Although Friday's U.S. jobs data show continued declines in unemployment, many economists, such as from ZipRecruiter and LinkedIn, are concerned at the data they're seeing.
  • One of them called the decline in employers' job postings on ZipRecruiter "an early tsunami warning" and a "pull-the-ripcord emergency moment."
  • Several factors suggest pessimism from businesses about the near future, including the recent dry-up of government stimulus alongside ongoing operating constraints due to the pandemic.

Friday's jobs report showed the U.S. unemployment figures continuing their decline to 8.4% in August, from a high of 14.7% in April.

Despite that welcome news, more recent data from L.A.-based ZipRecruiter contains unsettling signs for the future. After 10 weeks of rising activity from employers, job postings have reverted to a downward trend since mid-August.

"This is an early tsunami warning," ZipRecruiter labor economist Julia Pollak told dot.LA. "It could be the start of exactly the sort of systemic breakdown the government was trying to avoid in the beginning [of the pandemic]."

U.S. data provided by the U.S. Bureau of Labor Statistics. Local data provided by the California Employment Development Department and includes seasonally adjusted final data except for July, for which finalized data was not yet available. No local data was yet available for August.

Unemployment rates don't tell a full story about where the economy is headed, Pollak said. It's a reminder that she wants people in power to heed.

"I think Congress should see this as an emergency sign," she said, noting that job postings on ZipRecruiter tend to be an early indicator of job growth – or decline.

The job picture in California and Los Angeles is similar to that of the country at large, according to ZipRecruiter's data. Los Angeles has one of the highest rates of unemployment among large metro areas.

LinkedIn, another job board, found hiring was 16.2% lower this August than last year.

It's not surprising to Jerry Nickelsburg, an economist at the UCLA Anderson School of Management. He worries it will exacerbate inequality in Los Angeles, as industries being hit hardest tend to skew toward lower-income sectors, like logistics and tourism.

Nickelsburg said the federal unemployment data paints it a murky picture. The regulatory changes in recent months that led to a number of re-openings "mask what's going on underneath" at the economic level, he said. "We have less visibility than we normally have," Nickelsburg added. Assuming a continuation of the start-and-stop pace of opening up and the regulatory response, he foresees a "soft labor market in spite of the strong jobs report," noting that the job growth in today's data is fueled in part by temporary positions associated with the U.S. Census.

LinkedIn's principal economist Guy Berger also reported this week that hiring observed on LinkedIn (measured by the share of members adding a new employer to their profiles) fell from July to August. "Our takeaway is that this month's data shows that the virus has created a 'ceiling' on just how much the economy can return to normal," he said. "Given how much higher COVID transmission is here in the U.S. vs. aboard, the ceiling might be lower here."

"My real fear is what will happen in September," Pollak said. "I look at a downturn in job postings as a break-the-glass, pull-the-ripcord emergency moment."

Pollak said her alarm follows weeks of optimism. More companies had been signing up for ZipRecruiter's services. Every single industry and every single state had seen job postings increase in July and August, she said. But now, those trends have stopped, and a number of factors appear to be turning that summer of hope into a fall reckoning:

Ongoing Uncertainty: Without clarity on the pandemic and the government's policy to stop it, businesses remain inclined to do what they usually do in the face of uncertainty: sit and wait. Berger, the LinkedIn economist, said this is due at least in part to a "less centralized U.S. response" to the pandemic and that the uncertainty is holding businesses back from long-term investing and hiring.

Reduced Economic Activity: Anticipated closures of spectator sports, performing arts, colleges and ski resorts will hurt not just the businesses in those industries, but also adjacent ones like bars and restaurants. This expected dampening follows a quiet summer, which is normally the banner season for many such businesses. "Summer profit margins weren't large enough to sustain many businesses," Pollak said. Facing a future with fewer customers, "many will have to close in the fall."

Government Stimulus Is Drying Up: The $350 billion payment protection program loans designed to help employers pay their workers during the shutdowns ceased on August 8th. $600 weekly unemployment checks expired in July, causing a $60 billion reduction in unemployment payouts in August. "That is almost certainly reducing consumer spending right now," Pollak said, pointing to a survey ZipRecruiter conducted this summer that found over 40% of respondents would be unable to pay their rent if unemployment payments shrunk. Congressional talks on renewing a stimulus program have been gridlocked.

Schools Aren't Opening: Berger called virtual classes and delayed school re-openings "a severe challenge for households where all parents work." That's behind his topline takeaway that, in addition to a vaccine, his data point to a "need to get money back in the hands of Americans who need it and a childcare solution for the interim."

Consumer Confidence Is Down: Conference Board, a think tank, released data this week that consumer confidence has fallen two months in a row. "If confidence goes down, we can expect spending to go down," Pollak said – both among those who have no choice and those on the fence about, say, buying a house or a new car.

Pollak added that since neither the stock market nor housing values have crashed, her data point to widespread "concern about COVID, the future course of policy, and the ability for businesses to reopen and be sustainable given reduced sales and rules limiting their capacity."

Over the coming months she and others will be closely watching for the speed at which jobs are able to return to their pre-COVID baseline, and other indicators of a dynamic labor market. These include participation rates among prime-age workers and women, wage growth and long-term unemployment. But as long as the pandemic lingers, those indicators may be tepid.

    "We can't fully bounce back until there is more certainty around the virus," Berger said.

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    Rain's Latest Funding Fuels the Future of Financial Wellness

    🔦 Spotlight

    Happy Friday,

    This week, the LA tech scene buzzed with news that Rain, a leader in financial wellness, hassecured $75 million in Series B equity funding, spearheaded by Prosus. This isn't just another funding round; it's a pivotal chapter in Rain's mission to transform how American workers interact with their earnings.

    Since its inception, Rain has been at the forefront of innovation in financial technology, particularly with its earned wage access solutions. The concept was simple yet revolutionary: allow workers to access their earned wages instantly, mitigating financial stress and dependency on high-interest payday loans. This vision quickly gained traction, propelling Rain from a promising startup to a key player in the fintech space.

    What makes this Series B funding particularly noteworthy is what it represents on a larger scale. It's not just an influx of capital but a strong endorsement of Rain's potential to expand even further. With previous rounds fueling their initial growth and strategic partnerships, such as their notablecollaboration with Marqeta to enhance payment technologies, Rain has steadily built a foundation not just for success but for significant impact.

    As Rain secures this significant new funding, their initiative to reshape financial wellness is set to expand dramatically, showcasing the profound impact tech can have on everyday financial challenges.

    Looking forward to seeing how their innovations will drive change in the financial landscape.

    🤝 Venture Deals

    LA Companies

    • Dosen, a Los Angeles-based HRtech startup founded by Ronan Wall, Victor Burke, and Cian McCarthy, has secured $2.3M in an oversubscribed pre-seed funding round led by Affinity Ventures. The company offers an AI-powered platform that aligns employee-led learning with business goals through personalized, gamified development programs. The funds will be used to scale the platform, enhance AI-driven personalized learning, and improve employee engagement and productivity. - learn more
    • Plug, a Santa Monica-based company operating an EV-exclusive wholesale online auction platform, has secured $6.7M in an oversubscribed seed funding round led by Floodgate, Autotech Ventures, and A*. The company has also launched Plug Trade Desk™, the first EV-focused service designed to help dealers confidently price, move, and monetize trade-ins. The newly acquired funds will be used to enhance Plug's technology and expand its services, aiming to support dealers in navigating the growing used EV market. - learn more
    • Gallatin AI, a defense tech startup, has raised $15M in seed funding led by 8VC to scale its AI-powered logistics platform, Navigator. The tool helps military logisticians predict, plan, and execute operations more efficiently in contested environments. Funds will be used to expand the team and deploy the platform across military services. - learn more
    • BLNG AI, a generative AI platform based in Los Angeles and Paris, raised $3M in seed funding led by Speedinvest to streamline jewelry design by turning sketches into photorealistic renderings and animations. The funding will support commercialization, team expansion in Europe and the U.S., and the launch of a subscription-based app for luxury brands and independent jewelers. - learn more
    • Amca, a newly launched aerospace company focused on modernizing the industrial supply chain, has raised $76M in funding from investors including Caffeinated Capital, Founders Fund, Lux Capital, Andreessen Horowitz, and others. The company plans to acquire specialized suppliers and develop new aerospace products, aiming to strengthen and future-proof the sector’s manufacturing and innovation capabilities. - learn more
    • Turbine Finance Corp., a Santa Monica, California-based data science-driven liquidity platform, has raised a total of $21.75M in equity funding, comprising a $13M Series A round co-led by Alpha Edison and TTV Capital, and a previously unannounced $8.75M seed round with participation from Fin Capital, B Capital, and Sozo Ventures. Additionally, the company secured up to a $100M warehouse facility from Silicon Valley Bank to provide credit facilities to venture investors. The combined funding of $121.75M will be used to deploy the warehouse line and expand Turbine's data science team. Turbine's platform enables private equity and venture firms to offer limited partners access to the value of their portfolio investments without reducing exposure, leveraging machine learning to expedite underwriting processes. - learn more
    • Gente Beauty, an innovative Brazilian body care brand, has received a lead investment from Webster Capital, a private equity firm specializing in consumer and healthcare sectors. This partnership aims to support Gente Beauty's growth and expansion in the beauty industry. - learn more
              LA Venture Funds
              • Alexandria Investment Partners participated in a $41M Series A round for Solu Therapeutics, a Boston-based biotech company developing targeted protein degradation therapies. The funding will advance its lead candidate, STX-0712, which recently entered a Phase 1 clinical trial for CMML and other advanced blood cancers. - learn more
              • Calibrate Ventures participated in SigIQ.ai's $9.5M seed funding round. SigIQ.ai, based in Berkeley, California, is an AI tutoring startup focused on providing personalized education through advanced AI models. The funds will be used to hire top talent, enhance their AI models, and scale their platforms to educational systems worldwide. - learn more
              • Rusheen Capital Management participated in Zero Industrial's $10M Series A funding round, aiming to accelerate the development of thermal energy storage solutions in North America. Zero Industrial focuses on deploying large-scale thermal energy storage projects to enhance energy efficiency and support decarbonization efforts. The funding will be used to expand their project pipeline and advance the commercialization of their technology. - learn more

              LA Exits

              • Bread Beauty Supply has been acquired by Cost of Doing Business (CODB), a holding company founded in 2024 by Topicals founder and CEO Olamide Olowe and president Sochi Mbadugha. The acquisition aims to expand Bread's retail presence in the U.S., starting with an increased footprint in Sephora stores. Founder Maeva Heim will continue as Chief Creative Officer, focusing on the brand's creative direction, while CODB will manage strategic operations. This move reflects CODB's commitment to supporting Black-owned businesses and fostering diversity in the beauty industry. - learn more

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                            El Segundo Startup Turns Tax Credits into Big Business

                            🔦 Spotlight

                            Hello LA,

                            Step into the world of Incentify, the El Segundo-based innovator turning the headache of managing tax credits and incentives into a walk in the park. Founded in 2019, this trailblazing company is reshaping how businesses approach what was once a daunting bureaucratic challenge.

                            Incentify’s platform is revolutionizing the industry by helping businesses discover and effectively manage a share of the estimated $1.2 trillion in tax credits and incentives that often go unclaimed each year. This critical service not only simplifies the process but also ensures that companies can more easily access and leverage these financial opportunities to fuel their growth and sustainability initiatives.

                            Recently, Incentify reached a new milestone by securing $9.5 million Series A funding led by Innovent Capital Group. This significant investment underscores the market’s confidence in their innovative approach and supports their mission to expand their technological capabilities and market reach.

                            As Incentify gears up for this expansion, their efforts are set to make tax incentives more accessible to a broader spectrum of businesses. This is especially vital in today’s economy, where optimizing financial strategies is crucial for business resilience and growth.

                            Incentify's success story from El Segundo is not just about financial gains but also about empowering companies with the tools to turn complex financial engagements into strategic advantages.

                            Stay tuned for more from LA’s vibrant tech scene. Let’s continue to push the boundaries of what’s possible.

                            Enjoy your weekend, and keep innovating, LA!

                            🤝 Venture Deals

                            LA Companies

                            • TOGETHXR, a pioneering women's sports media and commerce brand co-founded by athletes Alex Morgan, Chloe Kim, Simone Manuel, and Sue Bird, has achieved profitability and significant growth, including tripling its year-over-year revenue and increasing its social media following by 17% year-to-date. The company has secured additional growth capital in a funding round led by Alex Morgan's Trybe Ventures. The funds will be used to expand TOGETHXR's presence in the women's sports marketplace. Additionally, media executive Nancy Dubuc has joined the company as Executive Chair, bringing her extensive experience to support TOGETHXR's mission of elevating women's sports and culture. - learn more
                            • Airvet, a Los Angeles-based pet telehealth platform, has secured $11M in an oversubscribed Series B-2 funding round led by HighlandX. This investment follows a year of significant growth, including a 4x increase in year-over-year revenue and a tripling of its client base. Airvet partners with leading employers across various industries, such as PepsiCo, Adobe, and Lyft, to provide employees with 24/7 access to veterinary care via video or chat. The platform's services include online pharmacy, e-prescriptions, discounted pet insurance, wellness programs, and specialty care, with recent expansions into Spanish and French language support. The funds will be used to further enhance Airvet's platform and expand its reach, aiming to make veterinary care more accessible and affordable for pet families globally. - learn more
                                    LA Venture Funds
                                    • Interlagos co-led a $50M Series A funding round for Aetherflux, a San Carlos, California-based startup developing satellites to collect and transmit solar energy from space to Earth. The funds will be used to expand Aetherflux's engineering team and advance the technology for its planned low Earth orbit demonstration mission in 2026. - learn more
                                    • Bungalow Capital Management co-led a $2M seed funding round for Juno, a Denver-based startup specializing in corporate guest travel management. Juno offers an integrated platform that streamlines booking, logistics, payments, reimbursements, and support for non-employee travelers such as job candidates, contractors, and customers. The funds will be used to accelerate product development and expand partnerships, including a collaboration with ALTOUR as their first travel management company partner. - learn more
                                    • Veridical Ventures co-led a $3.75M seed funding round for Flagship, a Sydney, Australia-based retail technology company specializing in visual merchandising solutions. Flagship's platform creates digital twins of retail stores, enabling data-driven optimization of product placement and store layouts to enhance sales performance. The funds will be used to expand Flagship's presence in the U.S. market and further develop its product offerings. - learn more
                                    • Miroma Ventures participated in a £6.5M Series A funding round for Limitless Travel, a Birmingham, UK-based company specializing in accessible holidays for individuals with disabilities. Founded in 2015 by Angus Drummond, who was diagnosed with muscular dystrophy at 22, Limitless Travel offers curated group holidays with trained carers, ensuring accommodations and excursions meet specific accessibility needs. The investment will enable the company to enhance its technology, expand its range of destinations, and lay the groundwork for international growth, aiming to transform the lives of disabled individuals through travel. - learn more
                                    • B Capital participated in a $20M Series A funding round for Gable, a Seattle-based company specializing in data management solutions. Gable's platform focuses on "shifting left" in data management by enabling software and data developers to collaboratively build and manage high-quality data assets through API-based data contracts. The funds will be used to accelerate product development and expand Gable's team to meet the growing demand for data collaboration tools. - learn more
                                    • Rebel Fund participated in a $3.8M funding round for Sohar Health, a health technology company. Sohar Health is developing an AI-powered platform designed to streamline patient intake and triage, aiming to enhance access to healthcare services. The funds will be used to accelerate product development and expand the company's reach within the healthcare industry. - learn more

                                        LA Exits

                                        • Tixologi, a next-generation ticketing platform, has been acquired by Punchup Live, a New York-based comedy platform. This strategic move integrates Tixologi's advanced ticketing technology into Punchup Live's ecosystem, enabling seamless, direct-to-fan ticket sales for comedians and venues. The acquisition aims to enhance the ticket purchasing experience by providing features such as fast checkout, unified outreach tools, and advanced anti-scalping solutions, thereby empowering comedians to connect more effectively with their audiences. - learn more
                                        • InVisit, a Calabasas, California-based provider of cloud-based visitor management solutions, has been acquired by Motorola Solutions. InVisit's platform streamlines visitor registration, access, and host notifications across sectors such as commercial offices, education, and healthcare, enhancing security through features like blocklist screening and real-time guest activity insights. This acquisition aims to integrate InVisit's capabilities into Motorola Solutions' Avigilon Alta security suite, offering enterprise customers a unified, cloud-native approach to managing security threats and improving operational efficiency. - learn more

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                                                    $207M Later, Napster is Back and Ready for the Metaverse

                                                    🔦 Spotlight

                                                    Happy Friday, Los Angeles!

                                                    This week, we’re rewinding the clock and fast-forwarding into the future at the same time. Napster, yes, that Napster, just got acquired for $207 million byInfinite Reality, a metaverse and immersive tech company that’s aiming to bring the iconic music platform into the next generation.

                                                    For anyone who came of age in the early 2000s, Napster was either your musical awakening or the reason your dial-up connection crashed. Launched in 1999 by Shawn Fanning and Sean Parker, it was the face of peer-to-peer file sharing and a lightning rod in the music industry’s first wave of digital disruption. After its legal battles and shutdown in 2001, Napster bounced between owners like Roxio and Best Buy, before eventually merging with Rhapsody and evolving into a legitimate streaming service.

                                                    Now, Infinite Reality is giving Napster a fresh remix. The company says it plans to turn Napster into a social-first music platform that emphasizes artist-fan interaction over passive listening. We’re talking virtual 3D concert experiences, listening parties, fan communities, and merch drops… essentially, a metaverse-native platform built for music superfans.

                                                    According to Infinite Reality CEO John Acunto, this aligns with the company’s bigger vision: moving the internet away from “a flat 2D clickable web” into “a 3D conversational one.” They’re betting that a brand like Napster, which already carries cultural weight, can thrive in a world where fans want deeper connections and creators want modern monetization tools.

                                                    It’s a bold move, but maybe a smart one. Nostalgia is a powerful asset, and in an era where legacy brands keep getting digital reboots, Napster has a chance to go from early disruptor to comeback story.

                                                    Will today’s listeners hit play? We’ll see. But as far as tech comebacks go, we’re here for this remix.

                                                    🤝 Venture Deals

                                                    LA Companies

                                                    • Topanga, a Los Angeles-based company specializing in AI-driven waste reduction solutions for commercial kitchens, has raised an $8M Series A funding round led by Blue Bear Capital, with participation from Struck Capital, Amasia, and Wonder Ventures. This investment brings Topanga's total funding to $12.2M. The company plans to use the proceeds to expand its food waste tracking platform into the senior living, health care, and hospitality sectors, accelerate the growth of its ReusePass system beyond universities into enterprise food service, and enhance integration with major food-service platforms like Grubhub and Jamix. - learn more
                                                    • Flight Science, an aviation tech startup focused on AI-powered flight optimization, raised $1.5M in pre-seed funding led by Outsiders Fund. The company helps airlines reduce fuel costs, emissions, and turbulence impact, and will use the funds to grow its team and expand product rollout by summer 2025. - learn more
                                                          LA Venture Funds
                                                            • Second Sight Ventures participated in a $14.2M Series A1 funding round for Lucky Energy, an Austin, Texas-based energy drink company. Lucky Energy offers a line of zero-sugar, zero-calorie beverages in six flavors, formulated with ingredients like maca and beta-alanine. The company plans to use the funds to accelerate distribution, introduce new products, support strategic partnerships, and recruit in key business areas. - learn more
                                                            • M13 led a $5.5M funding round for Chord Commerce, with participation from Act One Ventures and others. The New York-based company provides an AI-powered customer data platform (CDP) that helps commerce brands unify customer data, generate real-time insights, and automate marketing decisions. The funding will be used to further develop the platform and support brands in scaling their data-driven marketing efforts. - learn more
                                                            • Upfront Ventures led a $4M Seed funding round for Arlo Health, a New York City-based AI-powered health insurance underwriter focused on small and mid-sized businesses. Arlo offers level-funded health plans designed to improve preventive care and cost transparency through value-based care and AI-driven underwriting. The funds will be used to expand its broker network, grow its engineering and sales teams, and scale operations. - learn more
                                                            • Bonfire Ventures co-led a $5M Seed funding round for VoiceOps, with participation from Village Global and others. Based in New York City, VoiceOps uses generative AI to analyze phone calls and surface insights that boost sales performance, ensure compliance, and optimize marketing. The funding will support product development, team expansion, and broader market adoption. - learn more
                                                            • MANTIS Venture Capital participated in a $17.2M Seed funding round for EDGE Markets, a fintech company building banking tools tailored to the gaming industry. EDGE’s flagship product, EDGE Boost, offers a debit card and bank account specifically designed for betting, with features like spending limits, financial transparency, and cash-back rewards. The funds will be used to further develop the platform and expand its presence within the gaming market. - learn more

                                                                LA Exits

                                                                • SmartDepo, a leading provider of AI-powered deposition summaries for the legal industry, has been acquired by Rev, a prominent speech-to-text technology company. Founded in 2023 by civil rights attorney Isaac Manoff, SmartDepo delivers comprehensive deposition summaries featuring 100% accurate page-line citations, hyperlinked tables of contents, key admissions analyses, and deposition memos highlighting essential themes. This strategic acquisition combines Rev's highly accurate transcription services with SmartDepo's advanced summarization capabilities, aiming to enhance productivity for attorneys and court reporters by reducing manual review time and improving client outcomes. - learn more
                                                                • Stem, a platform offering personalized distribution and digital strategy services for independent artists and labels, has been acquired by Concord, a leading independent music company. Stem will operate as a separate division within Concord Label Group, with CEO Milana Lewis and President Kristin Graziani continuing in their roles. This acquisition provides Stem with the capital and resources to invest in new technology, expand its suite of label services, and accelerate global growth, while maintaining its mission to empower independent artists with autonomy and support. - learn more

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