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L.A. County supervisors seek aid for hundreds of workers affected by Phillips 66 refinery closure

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L.A. County supervisors seek aid for hundreds of workers affected by Phillips 66 refinery closure

With a major oil refinery in Wilmington and Carson scheduled to close next year, Los Angeles County officials are looking to shore up resources for hundreds of workers who will be left without jobs.

The Los Angeles County Board of Supervisors unanimously passed a motion Tuesday asking county staff to work with local partners such as the city of Los Angeles and the South Bay Workforce Investment Board to develop a plan to provide hiring fairs, training and other job placement resources for affected workers.

Oil giant Phillips 66 announced in October that the century-old complex, which sprawls across 650 acres and produces about 8% of the state’s gasoline, would cease operations late next year. Its closure will affect some 600 employees and 300 contract workers that keep its operations running.

Supervisor Janice Hahn said at the meeting that more than half of the affected workforce is Latino and includes skilled workers such as operators, welders, engineers and safety compliance experts that would bring “years of specialized training and certifications” to other jobs. She said they should receive support to help them make the transition to similar jobs in renewable energy, infrastructure development and advanced manufacturing.

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“This is a time the county needs to lean in and support them as they face this abrupt transition,” Hahn said.

Supervisors Hahn and Holly Mitchell introduced the motion, which also asks various departments to identify career pathways for “hard-to-hire” skilled trade positions within the county itself.

“We have the responsibility to ensure that displaced workers can smoothly transition … not just by partnering with the private sector but also by opening up doors here at the county,” Mitchell said at the meeting.

The county’s Director of Economic Opportunity has 60 days to report back to the board with an action plan.

The announcement of the pending closure came amid community concerns of harmful emissions and high pollution levels. Mark Lashier, chairman and chief executive of Phillips 66, said in an October news release that the long-term sustainability of the operation was “uncertain and affected by market dynamics.”

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“We understand this decision has an impact on our employees, contractors and the broader community,” Lashier said. “We will work to help and support them through this transition.”

The closure will leave the state with eight major refineries, three in the Bay Area and five in Southern California, operated by Chevron, Valero and others.

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OpenAI's controversial Sora is finally launching today. Will it truly disrupt Hollywood?

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OpenAI's controversial Sora is finally launching today. Will it truly disrupt Hollywood?

OpenAI’s controversial text-to-video artificial intelligence tool Sora sent shock waves through the entertainment industry when the company unveiled it earlier this year.

The technology promised to revolutionize filmmaking by automatically creating short movies based on written commands. For example, users could type in descriptions, such as “a stylish woman walks down a Tokyo street,” and Sora would provide up to 60-second videos based on that information. Workers feared that it was a prelude to a future in which AI displaced jobs throughout Hollywood.

But until now, Sora has been available only to people participating in research, testing and previews for artists.

On Monday, Sora faces its next big test as OpenAI, best known for the ChatGPT text bot, makes it available to the broader public. In the U.S., consumers can use Sora with a ChatGPT Plus subscription, which costs $20 a month. It can generate up to 50 videos of up to 20 seconds long. Customers can get more Sora usage, higher resolution and longer videos with a ChatGPT Pro subscription.

OpenAI executives say Sora will lead to new possibilities for artists and creatives.

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“We really believe that Sora can open doors for people to explore and share their creativity visually, especially without extensive resources or training,” said Souki Mansoor, Sora artist program lead for OpenAI, in an interview. “As we know, filmmaking is very expensive.”

The tool will be accessible for people 18 or older where ChatGPT is available, except for in the United Kingdom, Switzerland and countries in the European Economic Area. OpenAI said it is working on enabling Sora in those locations. The company is also preparing a free version of Sora.

AI is a major source of tension in the entertainment industry. It was a key issue in last year’s strikes by actors and writers, who sought protections from the rising tech as part of their contract negotiations.

Many have also raised concerns about how AI models are trained and whether intellectual property rights holders and artists are being compensated fairly, or at all, for content digested by the powerful technology.

Entertainment companies meanwhile have been exploring partnerships with AI startups as a way to save money.

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Mansoor said that OpenAI is sensitive to the concerns raised by creatives about potential job losses, but is optimistic about the opportunities.

“Sora is designed as a creative collaborator, so the hope is that it helps artists bring very ambitious projects to life without expensive resources,” Mansoor said. “We think that this is raising the bar for what’s possible in video creation.”

Sora’s proponents say it could help artists test bold ideas without as many budget constraints. Alexia Adana, a New York-based creative director and visual artist, made the case that it could enable more stories from people, including underrepresented creators, who lack financial resources or equipment.

“We’re in this age where you can create anything and you can learn anything, and it’s either free or very low cost,” said Adana, who had early access to Sora. “This is such an exciting time for people who wouldn’t normally have the resources to demonstrate their vision.”

Adana used Sora to create a film concept called “Bloomchild,” which depicted a child made of soil and dirt who blooms and struggles to fit in. She said it was influenced by her own experiences as a person from Jamaica who grew up in the suburbs of Connecticut.

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“I’m able to use a tool to come up with a full-on trailer,” Adana said. “I would have never been able to do that before.”

Indie pop artist Washed Out used Sora to create a music video. The director said the tool allowed him to show scenes from multiple places at a fraction of the cost of shooting on location. Meanwhile, a video that explained the origins of Toys R Us was made 80% with Sora, said Nik Kleverov, chief creative officer of Native Foreign, a Culver City-based creative agency and production company.

OpenAI said Sora will have safety measures in place to prevent abuses of the tool, such as child nudity.

Rohan Sahai, Sora’s engineering lead, said OpenAI has done “a lot of safety work to better understand how we prevent misuse” since Sora was first announced in February.

Some artists are angry with how OpenAI has gone about testing and developing Sora. Last month, a group of artists posted concerns in an online letter about how many creators, in their view, are being used to test and promote the technology without adequate compensation.

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The open letter has received more than 1,170 signatures, including from London artist Jake Elwes.

“While hundreds contribute for free, a select few will be chosen through a competition to have their Sora-created films screened — offering minimal compensation which pales in comparison to the substantial PR and marketing value OpenAI receives,” the artists wrote.

Mansoor said that the group’s comments had no influence on the timing of Sora’s launch. She said that the company focused on giving early access to artists who would be most disrupted by tools like Sora and give them the option of helping shape the tool’s development.

“There was no obligation to even use the tool, much less give feedback,” she said.

Mansoor said she came from the creative industry, spending more than a decade in independent filmmaking. “I came to OpenAI to create the kinds of experiences that I wish I had coming up in the industry,” she said.

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Kleverov said the concerns raised by the letter didn’t reflect the views of early testers. “The AI world is already so small and then within the world, those of us who are playing with Sora — it’s such a supportive space,” he said.

Walter Woodman, a director and co-founder of Toronto and L.A. production company Shy Kids, said once people experience Sora, “then everyone will see that it is not a magic bullet.” Shy Kids has used Sora to work on short films including “My Love.”

Many creators who have used AI tools say it takes time to get the hang of the tools and that the technology has important limitations.

“Sora can help, much like a camera, editing equipment, or great performance,” Woodman said in an email. “But without great storytelling and storytellers, it will be just a tool on the shelf. However, those with talent are in for a creative awakening.”

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Column: The Hoover Institution says all recent California job growth has been in government jobs. That's completely wrong

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Column: The Hoover Institution says all recent California job growth has been in government jobs. That's completely wrong

Back when most sensible Californians were concerning themselves with Thanksgiving preparations, the California-bashing right wing went hog wild over a stunning report that almost all private job growth in the state collapsed from January 2022 to June 2024 and almost all growth — 96.5% — was in government jobs.

“California’s Businesses Stop Hiring,” was the headline on the report published by the conservative Hoover Institution. Its main claim was that from January 2022 to June 2024, private employers in the state added only 5,400 jobs.

You can imagine how California bashers, including some within the state, greeted the news that government was propping up the state’s economy.

“This is what a failing state looks like,” Rep. Kevin Kiley (R-Rocklin), who badly lost a bid to replace Gov. Gavin Newsom in the 2021 recall election, tweeted. Others who gleefully tweeted about the Hoover claim included Rep. Vince Fong (R-Bakersfield), and venture investor Steve Jurvetson. Right-wingers outside California also joined the choir.

The Hoover article was what we in the news biz often pigeonhole as “interesting, if true.”

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But it’s not true.

The original article, by UCLA economics professor Lee Ohanian, a Hoover Institution senior fellow, asserted that California added only 156,000 nonfarm jobs in the January 2022-June 2024 period. Since government statistics also showed that government employment in the state rose by 150,500, that left (after rounding) only about 5,400 new jobs created outside the government sector.

The picture painted was one in which private employers are shutting down and only government hiring is keeping the California economy afloat. The opposite is true, however.

(The Hoover Institution has retracted the original article and removed it from its website. An archived version of the original can be found here.)

Here’s the main problem with the Hoover analysis: During the sample period, California actually added 672,300 nonfarm jobs, not 156,000. Consequently, the 150,500 new government jobs accounted for only about 22.4% of the total, not 96.5%. The accurate figures show that not only did California’s businesses not stop hiring, but continued to hire fairly robustly from January 2022 to June 2024.

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How did this calculation go so awry? The answer is simple. Ohanian conflated the two separate monthly employment surveys issued by the Bureau of Labor Statistics: One is its so-called household survey, which asks a national sample of about 60,000 households how many people in the household are employed. The other is its establishment or “payroll” survey, which asks about 629,000 workplaces how many people they employ.

Generally, the household survey yields a higher number of employed persons than the establishment survey. That’s because it counts the self-employed (including gig workers) and farmworkers, among others who are excluded from the payroll statistics. But that relationship breaks down when you’re counting only payroll workers, slicing and dicing the statistics into industry sectors.

Mixing together the BLS household data and the BLS establishment data is “a cardinal sin of BLS data analysis,” observes the pseudonymous economics commentator Invictus on The Big Picture blog of Ritholtz Wealth Management, in an indispensable deconstruction of Ohanian’s original post.

In that post, Ohanian subtracted the government jobs figure reported in the establishment survey from the nonfarm employment figure in the household survey. That effectively overstated the government jobs percentage of California employment growth. The proper approach, Invictus notes, would have been to use the establishment survey for both measures.

Ohanian acknowledged in an email that he had erroneously considered the household and establishment figures similar enough to treat them as effectively equivalent. “If I had seen the differences in the two series,” he says, “I would have written the piece differently. Mea culpa.”

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In a corrective article posted Tuesday on the Hoover website, Ohanian makes public his mea culpa but also reiterates a point he made in the original article, which is that California’s job growth is weakening. That’s echoed by other studies, including a recent warning from the state’s Legislative Analyst’s Office.

Yet there’s much more to be said about Ohanian’s original article, as well as the glee with which conservatives seized on its headline claim as the basis for largely groundless attacks on California’s economic policies. First, it’s proper to note that the original piece was published Aug. 7, which is why its analysis covers only the period that ended in June.

The government issues two distinct sets of employment statistics — the payroll or establishment survey (in orange) and the household survey (in red). It also adjusts the household survey to confirm more with the payroll survey. The adjusted figure is in blue. The two major surveys measure different things and shouldn’t be mixed.

(Bureau of Labor Statistics)

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Why it got resurrected and shot around the right-wing echo chamber last week is a mystery. Ohanian himself seemed uncertain when I asked him about it. Kiley, Fong and Jurvetson haven’t responded to my requests for comment.

That brings us to the statistics themselves. Employment data bristle with pitfalls for the unwary, even among experienced economists such as Ohanian. Indeed, in April, Ohanian posted an analysis on the Hoover website that purported to show a loss of 10,000 fast-food jobs in California from September 2023, when Newsom signed a minimum wage increase for that sector, through January this year — even before the increase went into effect.

As I reported, Ohanian based his post on a Wall Street Journal article that used employment figures that weren’t seasonally adjusted. That’s a crucial error when tracking jobs in seasonal industries such as restaurants.

The Journal’s article, and consequently Ohanian’s, mistook a seasonal decline in restaurant employment that occurs from September to January every single year for the one-time consequences of the minimum wage increase. Fast-food jobs, seasonally adjusted, actually rose by 6,300 in the period being reported. Ohanian told me at the time that he had been unaware that the Journal used nonseasonally adjusted figures.

BLS employment figures may be especially confusing because the bureau’s two surveys superficially seem to measure the same thing, but are very different — so much so that the bureau itself has issued a detailed explainer about the distinction. It notes that the establishment survey is “a highly reliable gauge of monthly change in nonfarm payroll employment.” The household survey is oriented more toward demographics and is best known as the source of the national unemployment rate.

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Ohanian used his misconstruction of employment figures as the basis for a wide-ranging critique of California economic policy, mostly citing how the high cost of living drives people out of the state.

“Part of California’s job weakness,” he wrote, “reflects the number of people and businesses leaving the state.” California’s population fell by about 75,000 from 2022 and 2023 (the latest data available), he wrote, adding that companies such as Tesla, Oracle, and Chevron have moved or are moving their headquarters elsewhere.

“Population loss naturally leads to job loss,” Ohanian told me by email. “It is challenging to see how California could be gaining jobs as portrayed in the Establishment Survey, given a smaller population.”

That may well be true over the longer term and with larger numbers. But the 75,000 departed residents in 2022-23 represent less than two hundredths of a percent of the state’s population. Even the larger population decline of about 538,000 since 2020 represents about 1.4% of the state’s population.

The key question would be: Who’s leaving? Many emigrants may be retirees, who don’t have occupational reasons to stay in the high-cost state and may have sizable equity in their homes to pocket for a move to a cheaper location; about 7.5 million of California’s residents today are older than 65. The pandemic also drove the population down — COVID-related deaths numbered at least 60,000 in 2020 and 2021.

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As for the emigration of corporate headquarters, California still leads the nation in headquarters of Fortune 500 companies, with 57. New York and Texas were runners up with 52 each. California remains a national leader in business creation, with nearly 560,000 new business applications filed with the state in 2023. When new technologies emerge with the potential to aid economic expansion, they tend to start in California.

One other subtext of the debate over California job growth needs to be mentioned. That’s the picture that conservatives paint about government jobs. The tweeted hand-wringings about the purported explosion in government jobs, which implies that the government workers are an army of faceless bureaucrats engaged in writing anti-business regulations.

The idea that the Musk/Ramaswamy Department of Government Efficiency can cashier them without affecting your daily life is a fantasy. In fact, the federal government employs only about 3 million workers, about half of whom are in the military, the Department of Veterans Affairs, and the Department of Homeland Security; the overall figure has remained fairly stable since the 1960s.

An additional 20 million are state and local employees, the majority of whom are teachers, along with police and fire fighters. Which of these workers should we fire?

Any discussion of California’s economy limited to periods of a year or two needs to be viewed in relation to the big picture, which is that California’s economy is by far the biggest in the country — indeed, it would rank in the top five or six countries if it were a sovereign state. At an estimated $4.08 trillion in gross domestic product, its economy is more than half again as large as the runner-up among U.S. states, Texas ($2.7 trillion).

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Ohanian is right to argue that there’s reason for concern about where the state goes from here. But to suggest that there’s something fundamentally faulty about policies that still undergird the most powerful state economy in the nation or that California is a “failing state” — that’s “interesting, if true” … but, again, not true.

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Glendale's ServiceTitan seeks to raise $500 million in IPO

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Glendale's ServiceTitan seeks to raise 0 million in IPO

ServiceTitan, a Glendale tech firm that makes business management software for plumbers, painters and other contractors, announced Tuesday that it wants to raise up to $502 million in its initial public offering on the Nasdaq stock exchange.

The company said it plans to offer 8.8 million shares that would be priced between $52 and $57 each, according to a regulatory filing. At the top of that range, ServiceTitan would have a market capitalization of $5.16 billion. The company was valued at $7.6 billion after a November 2022 funding round. ServiceTitan hasn’t said when it plans to start trading.

ServiceTitan was founded in 2007 by two college friends from Glendale, Ara Mahdessian, 39, and Vahe Kuzoyan, 41, whose fathers worked as contractors. The company previously raised about $1.4 billion from venture firms, including Iconiq Growth, Bessemer Venture Partners and Battery Ventures.

It counts about 8,000 contracting firms as customers, providing an end-to-end software suite that can manage booking appointments, generating estimates and processing invoices as well as payroll and dispatching workers. Clients range in size from family-owned contractors to large national franchises totaling more than 100,000 technicians. It charges a subscription fee for its services.

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The company, which assists contractors nationwide, says it wants to expand the number of trades and markets it serves. It employed 2,870 workers as of July 31 at its Glendale headquarters and offices elsewhere in the U.S. and internationally.

Competitors include BuildOps, Housecall Pro, Jobber and other companies that charge subscriptions for their web-based business management software.

ServiceTitan had filed confidential paperwork for an $18-billion public offering in 2022, according to Business Insider, but didn’t move forward after the Federal Reserve sharply raised interest rates to combat inflation, freezing up the IPO market.

The company reported revenue of $614 million in the fiscal year that ended Jan. 31, up nearly a third from a year earlier, and an operating loss of $195 million, 28% less than in fiscal 2023. It had about $147 million in cash and equivalents on hand as of Jan. 31 and was carrying $175 million in long-term net debt.

The company’s share structure will ensure that control remains with the founders — Mahdessian is chief executive and Kuzoyan president — who will retain all Class B shares, which are entitled to 10 votes each.

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Lead underwriters on the IPO are Goldman Sachs Group, Morgan Stanley, Wells Fargo and Citigroup. They have an option to buy an additional 1.32 million shares, which will be traded under the ticker symbol “TTAN.”

Bloomberg contributed to this report.

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