Hiring has also slowed down, with 4,500 jobs added in July, significantly lower than the 30,000 added in June.
California's unemployment rate has inched up for the second month in a row.
The news is not what job-seekers want to hear.
The unemployment rate for July jumped to 12 percent. That's up from June, when it was at 11.8 percent. A year ago it was much higher, at 12.4 percent.
One of the hardest hit areas anywhere in the country is Southern California's Inland Empire.
Unemployment in San Bernardino and Riverside counties combined is now at 14.7 percent.
Summertime unemployment in the Inland Empire jumped by 1.2 percent last year, this year, it rose by 1.5 percent.
But the /*California Employment Development Department*/ (EDD) says the trend of job growth in the state continued, and that's the number that counts more.
Companies added 190,000 jobs over the last year.
Unfortunately, the recovery shows a tale of two Californias: only parts of the state are seeing jobs and only in certain sectors.
"Especially in the Southern California region, where information is and motion pictures and so forth. And in the Silicon Valley region, where we see computer software design and telecommunications," said Loree Levy, EDD deputy director.
Despite small job growth, government continues to be a drag in California's economy with big reductions in payroll.
Because temporary tax hikes were not extended, for instance, hundreds of adult health day centers are shutting down on December 1, when the state eliminates funding.
The road ahead seems mixed for California.
The chief executive officer of Starbucks announced this week he intends to hire 70,000 people across the country.
But Bank of America may be laying off as many as 10,000 employees companywide.
Under fire for not doing enough to revive the economy, Governor Jerry Brown this week appointed a former Bank of America executive to help create jobs.