L.A. County Jobless Rate Lowest in 11 Years

Defying a national pattern of slowing employment growth, California gained a substantial 47,000 jobs last month and the unemployment rate declined to 5%, from 5.3% in June.

The report Friday from the California Employment Development Department bolstered hopes that the state’s expansion will push ahead even if the U.S. economy cools further.

In Los Angeles County, unemployment fell to its lowest level in more than 11 years, 5.2%, from 5.5% in June.

Many analysts are encouraged by the area’s recent economic trend, although county-by-county figures are often erratic.

Statewide, perhaps most impressive was the 32,900 increase in private-sector jobs. That meant California has created about one-quarter of the nation’s nonfarm private-sector jobs two months in a row.

Ted Gibson, economist for the California Department of Finance, said export industries such as electronics appear to be thriving and construction is on an upswing. He said one of the sectors that dipped last month, agriculture, is generally strong but was temporarily slowed by a cooler-than-usual July in the Central Valley.

All told, Gibson said, “The fundamentals in the state’s economy are very good right now.”

California’s recession in the early 1990s was far deeper and longer than the national slowdown, and joblessness here remains higher than the national average. In July, as previously reported, the U.S. unemployment rate was 4%.

As a result, economists are watching closely to see whether the evidence of economic cooling nationally will pull down California, or whether the state’s high-tech, entertainment and other export industries can maintain the expansion.

Many analysts have warned that California suffers from a bulging income gap between the state’s fabulously wealthy high-tech entrepreneurs and the vast numbers of low-wage immigrant workers. And, recently, some of the state’s hottest home real estate markets have started to cool.

Still, overall, the economy continues to grow briskly and is producing lots of jobs.

“Employers continue to talk about the great difficulty they have in finding workers,” said Michael S. Bernick, director of the California Employment Development Department. “The message is the same from small businesses and the large companies. There are thousands of openings.”

So far this year, California’s job gains have averaged 39,900 a month, versus a monthly average of 30,900 last year.

In the private sector alone, the average increase this year has been 30,800, versus 25,700 in 1999. This year, because of employment fluctuations related to the hiring and layoff of temporary federal census workers, labor-market analysts have focused more heavily on the private sector.

By way of comparison, the nation’s private sector has produced an average of 175,000 new jobs a month this year, down from 202,000 last year.

The worst news in Friday’s employment report came from the Central Valley, whose cities have some of the most severe metropolitan jobless rates in the nation. The highest unemployment was in the Fresno area, which had a 14.1% jobless rate in July, and in Merced County, where the level was 13.9%.

The state’s jobless rate over the last 12 months has ranged from February’s 4.6%, a 30-year low, to the high of 5.3% in June.

With the exception of Los Angeles County, the state’s lowest jobless rates generally are in major urban areas. In the three-county San Francisco area, July’s unemployment rate stood at 2.5%; in Santa Clara County, home to Silicon Valley, the level was 2.2%.

In Southern California’s tightest employment market, Orange County, the jobless rate inched up to 3%. That was up from 2.9% in June, and the same level for July 1999.

Lisa M. Grobar, director of the Cal State Long Beach Economic Forecast Project, said Orange County’s economy remains healthy, “but it’s not the kind of boom they had in ’98 and ’99.”

Grobar pointed out that the decline in Los Angeles County’s jobless rate--often an erratic figure because of the small sampling on which county estimates are based--was influenced by a large number of labor-force dropouts. She said that often happens in July, as many teachers and other school employees go on vacation.

Still, job gains in Los Angeles County in recent months have lifted the overall Southern California economy, reversing the pattern from earlier in the recovery.

In Southern California last month, unemployment rates climbed in Ventura and Riverside counties, in addition to Orange County. The jobless rate in Ventura County last month was 6%, up from 4.5% in June. In Riverside County, the rate was 7.2%, up from 5.9% in June.

San Diego County’s jobless rate, at 3.5%, and San Bernardino County’s, at 5.6%, were unchanged. Many of the originally reported figures for June were revised upward Friday.

Unlike the statistics for California and Los Angeles County, the figures for other communities in the state are not adjusted for seasonal trends. As a result, figures for many of the communities reflected the customary rise in joblessness during July.

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

Unemployment Rate Up

Orange County’s unemployment rate, which is not seasonally adjusted, rose to 3.0% in July--the highest rate for 2000. The monthly trend:

July ‘00: 3.0%

Source: Employment Development Department