State’s Unemployment Slips to 7.6%

California posted its smallest job gain in five months during March, but the rise was enough to nudge the state’s unemployment rate down to 7.6% from a revised 7.7% in February, state officials reported Friday.

The state showed a gain of 8,600 jobs last month, the skimpiest improvement since the negligible increase of 200 in October 1995. Employment declines in construction, government and retailing erased some of the sizable increases in business services and manufacturing.

Still, economists expressed confidence that the state’s economic recovery--fostered by such industries as entertainment, high technology, trade and other services--remains on track and that the apparent sluggishness in March was just a one-month aberration.

“We’ll see better gains in future months,” predicted David Hensley, a regional economist with Salomon Bros. in New York.

“The recovery is very broad-based. There are just a few lingering trouble spots,” he said, citing weakness in the aerospace-defense industry and consolidation among banks and other financial institutions.

In Southern California, where county unemployment figures tend to be more volatile because of the smaller samplings on which the estimates are based, the news was mixed. The jobless rate in Los Angeles County--which remains weaker economically than the rest of the resurgent region--hit 8.4% in March. That was the highest level since it stood at 8.6% in January 1995, and up from 8.2% in February.

The county’s economy “hasn’t been doing very much one way or the other. It’s not getting a lot better, but it’s not getting a lot worse,” said Vincent M. Canales, a labor market analyst with the California Employment Development Department.

Canales noted that the county’s jobless rate has been persistently high for more than five years, averaging 7.9% or higher every year since 1990, when it was 5.8%.

On the other hand, Orange County’s jobless rate fell to 4.2% in March from 4.6% in February. The Orange County statistics, unlike the state and Los Angeles County figures, are not adjusted for seasonal trends. Still, by way of comparison, the 4.2% joblessness was the lowest March rate for the county since 1990, when the level for the month was 2.7%.

Official government estimates show California averaging job increases of nearly 20,000 a month so far this year--down, but only modestly, from the average gains of just under 24,000 in 1995. While California in recent months had been adding jobs more quickly than the rest of the country, the figure grew more slowly than the national norm in March, when U.S. employers hired an extra 140,000 workers. The U.S. jobless rate for March was 5.6%.

Still, Ted Gibson, principal economist for the State Department of Finance, said the Employment Development Department estimates, based on polls of limited numbers of employers, probably underestimate California’s recent job growth. Gibson said his department’s payroll tax revenue suggests that employment actually is growing by about 30,000 jobs a month.

All the same, Gibson sees reason for optimism in the most recent EDD employment report. Gibson said the 2,500 jobs that California picked up in manufacturing last month was impressive in view of the factory employment losses being suffered elsewhere across the country.

An even bigger job gain of 13,900 came in services, particularly business services. Although no breakdown of that sector’s figures is available, the category includes a variety of growth areas ranging from the relatively high-paying computer software and multimedia fields to low-paying temporary help jobs.

The loss of 6,800 jobs in construction, on the other hand, may be a reflection of a lackluster rate of home building and the disappearance of earthquake repair work, Gibson said.

Times Staff Writer Don Lee in Orange County contributed to this story.

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Southland Jobless

Statewide, the unemployment rate in March dropped to 7.6% from 7.7%, but county rates varied widely. Jobless rates by county:

Los Angeles: 8.4% (March); 8.2% (February)

Orange: 4.2% (March); 4.6% (February)

Riverside: 7.7% (March); 8.8% (February)

San Bernardino: 7.3% (March); 8.0% (February)

Ventura: 6.2% (March); 6.9% (February)

San Diego: 5.5% (March); 6.1% (February)

Note: Los Angeles numbers seasonally adjusted; all other are unadjusted.

Source: California Employment Development Department