State’s Jobless Rate Down, but Slump Persists
California’s unemployment rate declined last month to 9.5%, down from 9.8%, but the state remains mired in a jobs slump, with only scant signs of a turnaround, the Labor Department reported Friday.
The national jobless figure also improved, dipping to 7.1% from 7.3%. But both the national and state numbers simply reflect a shrinkage of the work force as 508,000 fewer Americans sought jobs in January.
The state’s scant consolation is that the situation has not worsened since unemployment hit 10% in November, according to Thomas Plewes, associate commissioner of labor statistics.
“California could have had large increases in unemployment given the lousy weather conditions during the (unemployment) survey week--rain in the south and snow in the north,” Plewes said in an interview after a hearing of Congress’ Joint Economic Committee. “It’s good news that things have stopped getting worse.”
In Orange County, the most recent jobless rate figure, for December, was 6.1%. That was down a full percentage point from 7.1% in November, but the improvement came largely from seasonal hiring as retailers and tourism-related businesses added staff for the holiday shopping and vacation periods.
The county’s January jobless figures won’t be available until the end of this month.
A separate tally of jobs by the state Employment Development Department of employment at businesses in Orange County showed that a total of 1,500 jobs were trimmed from local payrolls during December, with the gains in retailing and tourism erased by layoffs in construction, manufacturing and service businesses, such as hospitals and law firms.
Orange County ended 1992 with an average unemployment rate of 6.1%, up substantially from the 4.8% average for 1991.
Southern California is suffering through a double hit: big layoffs in defense and related businesses with special impact on the region, and a general economic situation in which virtually all big employers are expanding their production while trimming payrolls.
Nationwide, companies “are streamlining and using their existing work force and not hiring,” Deputy Commissioner of Labor Statistics William G. Barron Jr. told the Joint Economic Committee.
“In this recovery, employers are extremely reluctant to hire,” he said, noting that the average workweek in manufacturing rose to 41.4 hours in January, the highest level in more than 25 years. The figure demonstrates that business will readily pay overtime to current workers, rather than incur the cost of adding another person to the payroll.
The recession officially ended 22 months ago, because that is when the nation’s output of goods and services began growing again. For job seekers, however, the slump continues.
Since World War II, the average economic rebound added 226,000 jobs a month; however, the current recovery has produced a minuscule 23,000 jobs monthly.
Rep. David R. Obey (D-Wis.), the committee chairman, likened the economy to a “plane that is finally getting off the ground but is flying so low there’s not much gas in it. We’ve got to keep the engines going, and get the plane flying higher and faster if we are going to clear the mountains of economic problems that loom in our future.”
The current unemployment figure does not reflect the recent rounds of layoffs announced by Sears, IBM and other corporate giants. Jobs lost from those firms will be tallied throughout the year as individuals report to the monthly Census Bureau surveyors that they are seeking work but unable to find it.
In January, 118.1 million Americans were working, a decline of 240,000. The ranks of the jobless totaled 9 million, down 267,000 from the prior month. The labor force shrank by 508,000--the number of individuals who gave up looking for work or who came of working age but did not seek employment. If all of them had sought jobs, the unemployment rate would have jumped to 7.5%.
White House Press Secretary Dee Dee Myers said the drop in the official jobless rate was “encouraging, but unemployment figures are still higher than they were at the trough of the recession in the spring of 1991.”
President Clinton “is still very concerned about the relatively slow recovery in jobs and in income,” she said. “He still thinks that it’s necessary to try to kick-start the economy, particularly in the area of job growth.”
In California, 13.8 million people were working, a drop of 62,000. Unemployment totaled 1.4 million, a decline of 54,000.
For the first time in six months, the survey of business payrolls indicated employment rose 29,700. However, the same thing happened in the past two Januaries, and the gains were later dropped as statistical flukes. This year, “we’re keeping our fingers crossed,” that there really were more jobs created, said Ted Gibson, principal economist with the California Department of Finance.
“I get the sense that things are bottoming out here,” Gibson said. “We may finally be looking upward rather than continuing to slide.” But he immediately tempered his optimism by noting the woes of Southern California. “We’re still losing jobs in manufacturing and particularly in the aerospace industry,” he said, citing the loss of 2,600 jobs in aircraft and 1,500 jobs in missiles and space vehicles.
Employment in Los Angeles County was 3,970,000 last month, a decline of 41,000. There were 462,000 job-seekers without jobs, an increase of 25,000.
The national jobless rates last month for major population groups were: men 6.4%, down from 6.8%; women, 6.4%, unchanged; whites, 6.2%, down from 6.3%; blacks, 14.2%, unchanged; Latinos, 11.6%, down from 11.7%.
Times staff writer Stuart Silverstein in Los Angeles contributed to this story.
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Jobless Rates
Here are U.S. and California unemployment rates, in percentages, over the last year:
U.S. Calif. Jan. 7.1 9.5 Dec. ’92 7.3 9.8 Nov. 7.3 10.1 Oct. 7.4 9.8 Sept. 7.5 9.4 Aug. 7.6 9.8 July 7.7 8.9 June 7.8 9.5 May 7.5 8.7 April 7.1 8.0 March 7.2 8.5 Feb. 7.2 8.7 Jan. 7.0 8.1
OTHER KEY STATES
Jan. Dec. Florida 7.8 7.2 Illinois 6.5 7.0 Massachusetts 8.2 8.6 Michigan 7.1 8.0 New Jersey 7.4 8.3 New York 8.5 8.5 North Carolina 5.4 5.6 Ohio 7.0 7.3 Pennsylvania 7.5 7.3 Texas 7.8 7.7
