California posts modest job growth; unemployment rate falls to 8.3%
California added a net 13,600 jobs in December, a modest but decent showing for a month of less-than-robust growth throughout the nation.
Those gains were enough to help push the unemployment rate down to 8.3% from 8.5% the previous month, the state Employment Development Department said Friday.
The Golden State saw job gains in many sectors. But the pace of growth slowed last month to 1.6%, down from a year earlier and from the first half of 2013, when the growth rate hovered around 2%.
California accounted for more than 18% of the jobs created in the country last month. A surprisingly lackluster national jobs report in December was blamed partly on poor weather but also raised doubts about increasingly chipper forecasts for economic growth this year.
“If you look at November and December, we generated almost 20% of all new jobs in the U.S., which is pretty good,” said Esmael Adibi, director of Chapman University’s A. Gary Anderson Center for Economic Research. “Although the pace of growth is still not what we would like to see to make a significant dent in unemployment.”
The unemployment rate also dropped as discouraged workers left the labor force altogether.
In December, the state’s labor force participation rate — the percentage of people with jobs or looking for work — fell to 62.2%, below the national rate of 62.8%. Those are the poorest showings for both the U.S. and California since 1978 and reflect a growing number of people who have given up looking for work.
“Part of it is baby boomers … many who are pushed out of the labor market as opposed to voluntarily leaving,” said Michael Bernick, a labor market researcher who previously led the Employment Development Department.
“The weak job market has also led to workers staying in school or on disability insurance,” he said.
Many Californians who lost jobs are like Mary Harris, 33, who stopped looking for work temporarily to head back into the classroom and learn new skills. After losing her secretarial job last January when her company folded, the Long Beach resident got her associate’s degree in business administration.
She’s been back on the job hunt for the last few months but has had little luck. Still, she’s hopeful that something could turn up soon.
“With my skills and education, I should be able to find a job in an office,” Harris said. “Otherwise, I may move to Texas. I hear things are better down there.”
In December, seven sectors out of 11 saw payroll gains.
Professional and business services posted the largest jump with 8,400 jobs. Leisure and hospitality, which has benefited from a resurgence of tourism in the state, reported an increase of 7,800 jobs. The combined trade, transportation and utilities sector came in third with a boost of 5,800 positions.
The largest job drop was in manufacturing, which lost 6,000 jobs. An additional 4,000 jobs were cut in the sector known as “other services,” which refers to jobs such as car mechanic or hair stylist that are not easily categorized. The information industry shed 2,800 jobs.
Although construction lost 1,700 jobs in December, industry watchers say the sector should continue to be an engine of growth, as it has been since the recovery began in the state.
Economists are mixed on their outlooks about 2014. Some predict a repeat of the slow and steady recovery that the state enjoyed last year, while others predict more momentum that will spur a quicker pace of growth.
Robert Kleinhenz, chief economist for the Los Angeles County Economic Development Corp., said California’s jobless rate could fall to its typical average of 7.5% by the year’s end.
“We should see faster acceleration in the labor market and other economic indicators this year compared to last year,” Kleinhenz said. “It ought to feel more like we moved further away from the worst days of the recession.”
Adibi of Chapman University forecasts 2.3% job growth in 2014.
In Southern California, there were job gains throughout much of the region.
Los Angeles County added 1,400 nonfarm jobs, and its jobless rate dropped to 9.2% from 9.5% in November. Orange County’s payrolls added 3,600, and its unemployment rate fell to 5.2% from 5.7% the previous month.
Riverside and San Bernardino counties combined added 6,700 jobs, and their jobless rate fell to 8.9% from 9.4%, while San Diego County gained 600 jobs and saw its unemployment rate decline to 6.4% from 6.9%.
The unemployment rates for California and L.A. County are seasonally adjusted. Those for Orange, Riverside, San Bernardino and San Diego counties are not.
