Unemployment Rate in O.C. Hits 5-Year Low

Providing further evidence of the region’s improving economy, state employment officials reported Wednesday that Orange County’s jobless rate plunged to a five-year low of 4% in December.

The rate drop, from 5.2% in November, reflected strong seasonal hiring by retailers as well as healthy gains in services and finance sectors.

Assuming the December jobless figure, which is preliminary, holds up, Orange County’s average unemployment rate for 1995 was 5.3%. That compares with 5.8% for 1994 and 6.7% for 1993.

“There is no question that we are in the right direction,” said Esmael Adibi, director of Chapman University’s Center for Economic Research.

The jobless rate, which is based on a sample of households and unemployment claims, typically falls in December because of holiday hiring. But last year, Orange County retailers added 5,200 jobs in the final month of the year--50% more than they did in 1994.

December’s rate of 4% was the lowest since October 1990, when joblessness was pegged at 3.9% shortly before the county slipped into recession. Compared with other Decembers, last year’s jobless rate was the lowest since 1989.

The big one-month drop in the county’s jobless figure mirrored the state’s performance. California’s jobless rate, as previously reported, fell to 7.7% from 8.8% in November. The U.S. rate for December held steady at 5.6%.

Wednesday’s report by the state Employment Development Department showed 1.282 million people were employed in December in Orange County, including an increasing number of self-employed workers. The state counted 54,100 people in the county as unemployed--about 16,000 fewer than November and 1,500 fewer than December of 1994, when unemployment was 4.2%.

At the national level, a 4% jobless rate would be considered full employment, meaning most everybody actively seeking work is working. The 4% constitutes a pool of people in between jobs that will always exist.

Although counties are considered too small to be described as fully employed, analysts pointed out that Orange County’s jobless rate is exceptionally low given the mass defense layoffs during the recession and the many people who have gone through training for new careers.

By comparison, unemployment in Los Angeles County was 7.6% in December.

According to preliminary data based on county employer records, total nonfarm payroll jobs in Orange County grew at a modest pace of slightly less than 1% for all of last year.

However, Adibi of Chapman University said he expected the state would raise the number of job gains when officials revise their figures this spring. Because the county payroll employment figures are drawn from a sample of mainly large employers, preliminary reports often miss hiring by smaller firms.

Despite the positive employment report, some bankers and other analysts have questioned the quality of jobs that the county was creating.

Adibi agreed that a fair number of new jobs were part-time and low-paying service work, but he said that businesses last year also boosted employment of higher-paying jobs that included computer programmers and lawyers.

“Not all are hamburger-flipping type of jobs,” Adibi said.