More Good News on State’s Job Front
California added another 24,500 jobs in October, marking the 24th consecutive month of record payroll employment, state officials said Friday in another bullish report on the state’s economy.
More than 1.2 million jobs have been created since the low point of the recession in 1993, and 342,800 positions have been added in the past year alone, according to the Employment Development Department.
The unemployment rate edged down to a seasonally adjusted 6.3% from an upwardly revised 6.4% in September. In October 1996, California’s jobless rate stood at 7%.
The bullish report was the latest installment in a string of good news for the state, where job growth has outpaced the nation as a whole.
The U.S. unemployment rate was 4.7% in October, but economists said that California is steadily closing the gap. Ted Gibson, chief economist at the state Department of Finance, expects that the state jobless rate will dip to the mid-5% range next year.
Gibson noted that statewide employment growth was dampened slightly last month by a Foster Farms strike in Livingston, which reduced payrolls by 2,500, and by a possible undercounting of restaurant employment.
“The job growth is even better than it looks,” he said. “To me, the underlying growth was close to 30,000, which is a pretty good number for the month.”
Steve Cochrane, senior economist at Regional Financial Associates in West Chester, Pa., noted that the unemployment rate has leveled off in recent months, even as job growth continues to be strong, largely because the number of new entrants to the labor force is at a four-year high. “This is pretty good, because it implies that the strong labor market conditions are drawing new people in who had been sitting on the sidelines.”
Another positive sign, he said, is that a larger share of those who are unemployed left their jobs voluntarily, rather than being fired or laid off. That shows “there’s less anxiety about the labor market,” he said.
“In bad times, if you’re unhappy with your job you may hang on to it anyway. In good times, you may just say, ‘I quit,’ and then go out and look for a good job,” Cochrane said.
The construction sector continued its upward climb in October, as employment grew 1,300 from September and was up more than 50,000 from a year earlier. Industrial and office construction is still growing rapidly a year into its rebound, residential development is starting to pick up, and government-sponsored projects are also underway.
“You name it, they’re building it right now in California,” said Cochrane. “It’s one of the strongest industries right now, and one of the reasons the California economy will continue going for the next year.”
Public school payrolls also climbed again in October, reflecting hiring to meet the statewide goal of reducing the size of primary classes.
More jobs were added last month in the aircraft, electronics and communications equipment industries. Semiconductor equipment manufacturers, who are vulnerable to the economic turmoil in Asia, also continued to hire. “That’s encouraging,” said Gibson, the state economist. “At least for the moment, we’re still seeing growth in that, which reflects that we’re not being hurt by the turbulence overseas.”
Los Angeles County’s jobless rate fell again last month, to a seasonally adjusted 6.5% from a revised 6.7% in September and 8% a year before. The county added 23,300 jobs last month, including 10,000 in government--mainly in education. Total employment has grown by nearly 68,000 in the past year, a 1.8% increase.
“This certainly indicates that L.A. is in the full swim of the recovery now,” said Gibson. He believes that when the state publishes its annual benchmark revisions in March, the results will show Los Angeles County job growth has been even stronger than the current numbers indicate, in part because entertainment industry employment has been undercounted.
Elsewhere in Southern California, the unemployment rate continued to fall. Orange County’s jobless rate declined to 3.3% from 3.5%, while Riverside fell to 8.2% from 8.8%. San Bernardino’s rate was 6.3%, down from 6.6% in September, and Ventura’s fell to 6.6% from 7.7%. Unlike the state and Los Angeles County jobless rates, these figures are not seasonally adjusted.
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Downward Trend
California unemployment rate, seasonally adjusted:
October ‘97: 6.3%
Source: Labor Department
