O.C. Unemployment Rate Rises to 6% in May From 5.5% in April

Orange County’s unemployment rate ratcheted up to 6% in May from 5.5% the month before, a typical springtime trend, the state Employment Development Department said Friday.

Last month’s figure was just slightly higher than the 5.9% rate for May, 1992. The EDD’s Anaheim office reported that Orange County lost 16,100 jobs overall during the one-year period.

But with the addition of people who are self-employed or independent contractors, employment actually increased by 13,600 from year to year. Chapman University economist Esmael Adibi said that the loss of jobs overall and gain among the self-employed may reflect that more people are contracting themselves out by working as free-lancers.

If that is the case, it would be consistent with a national trend in which businesses are hiring more outside workers who receive few, if any, benefits and can be easily dismissed if the economy goes sour.

Adrian Sanchez, regional economist for First Interstate Bank in Los Angeles, attributed the move toward free-lance and temporary workers to corporate caution about hiring.

“Some businesses are seeing a modest increase in sales, (but) they are not sure this is going to pan out,” Sanchez said. Their reasoning, he said, is “let’s hire some temps and see if the economy is getting stronger.”

Nearly all sectors of the Orange County economy had job losses over the one-year period, the EDD said. The exceptions were services and transportation/public utilities, which together added about 6,400 positions.

Construction, manufacturing, retail trade and wholesale trade took the brunt of the cuts, accounting for a total of 18,100 lost jobs. The county lost 4,900 jobs from year to year in high-technology industries alone, the EDD said.

The decline in employment from April to May is fairly typical, analysts said. Such a drop between those months has occurred in each of the past five years, according to EDD statistics. That drop-off, the EDD said, is due to students and teachers entering the labor market looking for work when the school year is over.

Orange County’s 6% unemployment rate for May compared to Los Angeles County’s 9.1%, California’s 8.7% and the nation’s 6.7%.