Evidence of economic pain is rippling across Southern California, hitting businesses big and small.
Until last month, Simon Yoon ran a popular sushi restaurant tucked away in a Diamond Bar strip center where commuters often stopped to pick up a bite to eat while waiting out the rush hour congestion at the nearby 57 and 60 freeway interchange.
Yoon shuttered his restaurant, Fusion 2 Any 1, because he could no longer make ends meet due to a wave of policy decisions to remake the economy by President Donald Trump, who’s just under a year in office now.
Yoon said he could no longer afford the $14,000 monthly rent and rising expenses caused by tariffs that tripled the price of everything from a box of chopsticks and a bag of garlic to plastic knives, forks and avocados.
“I couldn’t raise my prices to the consumers,” said Yoon, who didn’t want to push away his regulars. “I cut lots of labor.”
Also see: Economy shows ‘resilience’ despite ‘thorny issues,’ CSUF economists say
He also blamed the drop-off in customers on raids and tactics used in recent weeks by federal Immigration and Customs Enforcement officers in Diamond Bar, which created a climate of fear in the community.
“It’s hurting a lot of business,” Yoon said. “Catching criminals is great, but not everyone is a criminal. There are a lot of hard-working people that are having their families broken up. That’s sad to see.”
The 48-year-old Yoon voted for Trump a year ago but now regrets it. “I’m hoping for the best, but nobody comes out to eat,” he said.
Yoon isn’t the only business owner barely making ends meet these days.
Businesses across Southern California have shed thousands of workers amid a slowing economy, many citing similar reasons to Yoon’s — stretching from Anaheim to Ontario and Pasadena.
On Thursday, global outplacement firm Challenger, Gray & Christmas reported that last month was the worst October for layoff announcements since 2003. California saw 158,734 people laid off from Jan. 1-Oct. 31, up 16% over last year’s 136,661 — the second-largest employment cuts nationwide, according to the outplacement firm.
Cuts in federal funding — fueled by the longest-running federal government shutdown, now at 40 days — also are having their effects. Tariff wars with foreign nations over imports have rattled local businesses, as some are struggling with inflation and labor issues.
Cal State University Fullerton economists Anil Puri and Mira Farka and other economists with UCLA Anderson and Beacon Economics recently delivered cautionary forecasts on the state of the economy.
Underscoring the concerns, the CSUF economists said that inflation is expected to likely continue to “edge higher into the first quarter of next year,” though they do not expect it to get out of hand, anticipating a peak of around 3.5%.” They added that inflation has “yet to crest,” and “the labor market has yet to find its floor — though neither is expected to inflict as much pain as once feared.”
The current annual inflation rate for the U.S. was 3% for the year period ending in September. New inflation statistics published by the regional Consumer Price Indexes for September show an 3.5% inflation rate for Los Angeles and Orange counties. That’s the biggest cost-of-living bump in 16 months.
The economists said they wouldn’t be surprised if the remainder of the year is marked by “a few more bumps, with payrolls weakening further as firms await clarity on trade deals, the government shutdown and overall consumer demand.”
Unemployment ticks up
Layoffs in the region have picked up from a year ago, according to the government’s Bureau of Labor Statistics, the official federal agency that keeps track of jobs data.
The BLS paused updates during the government’s shutdown that began Oct. 1. In August, the unemployment rate in Orange County stood at 4.6%, down from a revised 4.8% in July 2025, but above the year-ago estimate of 4.5%. Similar unemployment trends were reported in Los Angeles County (6.3% in August), Riverside County (6.1%) and San Bernardino County (6.1%).
Puri and Farka said people should brace for sticker shock when the government reopens, revising figures on job losses and “alarming” hiring conditions.
In the past month, Anaheim theme park Disneyland laid off 100 salaried employees as Orange County’s largest employer recalibrates its business ahead of the busy Christmas holiday season. Amazon also is cutting 760 jobs in Southern California — 333 in Irvine — beginning in January as part of a shakeup driven by artificial intelligence, and Planned Parenthood of Orange and San Bernardino Counties laid off 81 people as it shutters Melody Health, its primary care practice, due to federal budget cuts.
Other layoffs in October:
- NASA’s Jet Propulsion Laboratory in Pasadena laid off 550 employees as part of its continued streamlining and restructuring plan across technical, business and support areas. This is the third round of layoffs at JPL in the past two years.
- The University of Southern California began cutting 259 jobs on Oct. 31 as it tackles a rising operating deficit of more than $230 million Since July 9, USC has laid off — or is in the process of terminating — 975 people throughout the university system’s nearly 24,600 faculty and staff.
- Kaiser Permanente also laid off hundreds of workers across California.
- Manna Beverages, an Anaheim-based beverage bottling company, announced its sudden closure in October due to “underperformance of the business,” forcing 627 layoffs statewide, nearly 40% of whom worked in Anaheim.
Some companies even feel the time is ripe to sell.
In August, Las Vegas-based Silver State HVAC, Refrigeration & Plumbing acquired The Whitman Co. in Anaheim.
“We wanted to avoid a fire sale,” said Linda Whitman, manager of the business and married to owner Fred Whitman, who pointed to the rising cost of doing business in California and plans to retire while the going was good.
She said profit margins were shrinking due to the rising prices of commercial-grade heating, ventilation and air conditioning systems since the pandemic when supplies tightened, plus challenges emerging in the past year with tariffs.
“We sold primarily for retirement purposes, but it also was driven by what you’ve heard a million times. It’s getting impossible to run a business in California,” Whitman said. “It’s hard to sustain that when costs for workers’ compensation and liability insurance are going up 25% year-over-year, in addition to labor costs and everything else.
“One of our big customers is a chain restaurant, and they have been struggling, and that of course affects us,” said Whitman, whose company has avoided layoffs by cutting back hours during certain times of the year. “If we weren’t going to be retiring, it would have been for all the other reasons that we might sell. Our sales have been increasing, but our profitability has not.”
ICE raids not helping
In Ontario, local shopkeepers are also worried about the economy.
In May 2024, Javier Barajas and his wife, Tania Mangas, took over the Tortas Ahogadas Chapala restaurant in downtown Ontario along G Street. It’s located in a strip center across the street from the popular El Pescador Mexican restaurant along Euclid Avenue — which was packed on Tuesday with a lunchtime crowd of city probation officers and office workers.
“People are scared,” said Barajas of the ICE raids.
Also see: Inland Empire ICE detainees include gardeners, students, fathers
Recent ICE operations in Ontario have dampened dining out and shopping. Business owners interviewed cited high-profile incidents like a landscaper being detained inside a surgical center in July, and a shooting during a vehicle stop in October. Other incidents include the taking into custody of at least three people at a Stater Bros. Markets along Holt Boulevard and arrests of gardeners.
Tariffs have not treated Barajas very well, as the price for meats added to Mexican dishes have doubled. On Tuesday, there were a handful of customers eating at the restaurant — which he says was busier before the raids began in the community this past summer.
For instance, he said, a chuck roll — a large boneless cut of beef from the shoulder of the cow — shot to $7.50 from $3.80 a pound last year, while a pound of ranchera meat — a higher premium type of beef cut, most commonly used in Mexican dishes like carne asada — jumped to $10.50 from $7 a pound.
He says beef prices are up because tariffs have led to higher overhead costs for feed, fuel and labor that have contributed to higher prices consumers see at the grocery store and in their bills at restaurants — like at his.
“It’s super hard to make money. I spend all of my money on the restaurant,” said Barajas, who has posted a “help wanted” sign on his restaurant’s front door to fill a cook opening.
At the JROD Insurance Agency just south of El Pescador, owner Jesse Rodriguez said that his business is barely getting by.
“We used to get walk-in business every time the Route 66 car show was held in Ontario. I didn’t get one customer this time,” said Rodriguez of the 12th annual Route 66 Cruisin’ Reunion that roared into downtown Ontario on Sept. 19. “There’s a slowdown everywhere here in town.”
Andres Torres, co-owner of Mission Furniture along Euclid, said that he saw furniture sales climb in the early days of the pandemic when everyone was locked down in their homes and shopping online. Sales have since tapered off, and profits have narrowed in line with a slowing economy he saw before Trump’s election.
But another slowdown has emerged with Trump administration-imposed tariffs on Vietnam and China, causing furniture prices to edge up 5-10%, Torres said.
“It’s tough, but I’m looking to the future to get ahead of the curve,” said Torres of development projects for housing and more potential shoppers coming in Ontario’s downtown area. “Our intention is to survive this, but the ICE raids don’t help.”
Diamond Bar’s Yoon might be temporarily down, but he’s come up with a survival plan for his business.
He recently took an offer from a business colleague to open his restaurant in a section of the Gangnam Korean BBQ along Golden Springs Drive, across the street from the Diamond Bar Golf Course.
If Yoon can turn his sushi-take out spot profitable, he may end up owning the new restaurant within Gangnam, and begin paying rent to its owner.
For now, however, he’s content with managing the bar and restaurant in half the space of his old one a mile away. “I don’t want to leave at the bottom because I did so much for the community,” he said. “I want to go on for a few more years.”
Key findings from local economic studies …
UCLA Anderson Forecast
- The labor market deteriorated notably, marked by a decline in payroll employment in June. The risk of rising layoffs leading to a recession is now a “tangible possibility.”
- The inflationary trend pivoted to “a rising trajectory.”
- A “stagflation-lite” regime is anticipated, marking a period in which both inflation and unemployment remain modestly elevated.
- Data on employment over the past eight months suggest the state is in an employment contraction, one that will last through 2025.
Beacon Econmics
- Growth is slowing as unemployment creeps up. Unemployment reached 5.5% in August — matching its highest level of the last three years and significantly above the national rate of 4.3%.
- Gross Domestic Product growth slowed to 1.8% year-over-year in the 2025 first quarter — half the pace of early 2024 and below the state’s long-term average of 2.7%.
- The housing market is cooling with annual home sales down to 300,000 — below the 400,000 pre-pandemic level and the 500,000 peak during the pandemic stimulus-era.
- Energy prices remain higher than national average. Utility prices in California have climbed faster than the national average since 2008, driven by “wildfire costs, climate investments, and grid upgrades.”
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In May 2024, Javier Barajas and his wife, Tania Mangas, took over the Tortas Ahogadas Chapala restaurant in downtown Ontario along G Street. “People are scared,” Above, on Nov. 4, 2025, Barajas said that people in the community are fearful of raids by agents of the U.S. Immigration and Customs Enforcement agency. “It’s been a roller coaster ride because of fear in the economy.” (Photo by Pat Maio)
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In May 2024, Javier Barajas and his wife, Tania Mangas, took over the Tortas Ahogadas Chapala restaurant in downtown Ontario along G Street. “People are scared,” Above, on Nov. 4, 2025, Barajas said that people in the community are fearful of raids by agents of the U.S. Immigration and Customs Enforcement agency. “It’s been a roller coaster ride because of fear in the economy.” (Photo by Pat Maio)
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