First, government. Sanjay Varshney is the dean of the business school at Sacramento State. He says California's budget crisis has crippled a region where a third of its workers are in the public sector.
Varshney: "The deficit keeps showing up every year. And that really puts downward pressure on government spending and what they can truly afford."
Second, the retail sector - a crucial part of a region that's seen its population grow significantly this decade.
Varshney: "Because of the high unemployment situation and the really very weak housing market, you know that consumers are being very cautious about how they spend."
The Sacramento region's unemployment rate currently stands at 12.6 percent. That's down from the start of 2010, when it hovered around 13 percent - but up from 12 percent this time last year.