California Posts 9,400-Job Gain in August

Despite the United Parcel Service strike, which knocked 25,000 workers off statewide payrolls last month, California’s overall employment market proved surprisingly resilient in August.

The number of jobs reached 13.2 million, well over a million above the low point of the recession in 1993, the state reported Friday. While the 9,400 new jobs added last month were well below monthly increases earlier in the year, economists were still impressed with the gain.

“That’s actually a pretty good performance,” said Stephen Levy, director of the Center for the Continuing Study of the California Economy in Palo Alto.

The state’s ability to register a net gain in new jobs in the face of the UPS walkout “confirms the underlying strength of the economy,” he said.

California’s seasonally adjusted unemployment rate remained unchanged in August from July’s revised 6.2%, according to the report by the state Employment Development Department. A year earlier, the jobless rate was 7.1%.

Though the state’s unemployment rate was still higher than the 4.9% rate for the nation in August, California has been adding jobs at a faster pace than the rest of the country and is quickly closing the gap.

Tom Leiser, an economist at the UCLA Business Forecasting Project, said the new figures are a very positive indicator of California’s employment outlook for the remainder of the year--particularly since the UPS strike was settled last month.

In Orange County, one of the state’s healthiest labor markets, the unemployment rate narrowed to 3.4% last month from 3.7% in July.

Unlike the state and Los Angeles County figures, Orange County’s jobless rate is not adjusted for seasonal variations. That makes the county’s slim unemployment rate in August even more impressive, economists said, because it includes teachers who were on summer break.

“You get down below 4% unemployment and there’s not much more you can say,” said Ted Gibson, chief economist at the state Department of Finance. “It’s over full employment.”

Esmael Adibi, director of Chapman University’s Anderson Center for Economic Research, said that Orange County’s unemployment rate will probably hover in the 3.2% to 3.6% range for the remainder of the year.

The county is enjoying a broad expansion with the job base growing at a brisk 3% annual clip.

But Adibi said the best news is larger-than-average employment gains in the manufacturing and construction sectors.

“That’s indicative of the strong export environment that we’re benefiting from, and which is obviously supporting a wide range of industries,” he said.

Indeed, Orange County’s economy is so vibrant that it might account for some of the decline in the unemployment among Los Angeles County residents, said Steve Cochrane, a senior economist at Regional Financial Associates in West Chester, Pa.

Los Angeles County’s employment picture also was bolstered last month by 8,800 new jobs in the motion picture business.

The county lost 7,400 jobs in August due to the UPS strike. Even so, total employment remained fairly steady at 3.84 million. The jobless rate edged down to a seasonally adjusted 6.6% from a revised 6.7% in July.

In August, 1996, Los Angeles County’s unemployment rate was 8.1%.

Consumer confidence nationwide is very high, and that bodes well for the large number of apparel, toy and tourism businesses in Los Angeles and Orange counties, Cochrane said.

“Business investment is still very strong, and that feeds into all the high-tech manufacturing in California,” he said.

“That provides a really solid foundation for the economy, and for growth.”

Gibson said he expects California’s unemployment rate to fall below 6% by the end of the year, “and L.A. will not be too far behind.”

Other Southern California counties also experienced lower unemployment last month. Ventura County’s rate fell to 7.5% from 7.6% in July. In San Bernardino County, the jobless rate was 6.6%, down from 7.1%, and Riverside County’s rate declined to 8.9% from 9.1%. Those figures are not seasonally adjusted.

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Orange County Trend

Orange County’s August jobless rate, 3.4%, was a slight decline from the previous month but nearly a full point below one year ago: Unemployment, not seasonally adjusted:

Aug.: 3.4%

Source: California Employment Development Department

Researched by JANICE L. JONES / Los Angeles Times

Work, Work, Work

August jobless rates in Orange County during the 1990s.

1997: 3.4

Source: California Unemployment Development Department