Monthly State Job Growth at 2-Year High

By STUART SILVERSTEIN

Jan. 15, 2000 12 AM PT

TIMES STAFF WRITER

The booming California economy created 63,700 jobs in December, the biggest monthly increase in nearly two years, officials reported Friday.

Employment growth was widespread, covering nearly every sector of the economy. The broad-based job increases, continuing a long-running rebound that began in 1993, “shows just how robust California’s economy remains,” said Ross DeVol, director of regional studies for the Milken Institute in Santa Monica.

California’s unemployment rate stayed at 4.9% for a fourth consecutive month, the lowest level in the 30 years that the state has tracked joblessness in its current format. (November’s jobless rate was revised to 4.9%, up from a previously reported 4.8%.)

Economists said the growing employment opportunities have drawn more people into the job market, including those who once were too discouraged about their prospects to look for work.

December capped a strong year that brought the state 401,800 new jobs. Although that rise was smaller than the 446,300 increase in 1998, many analysts said the state economy gained steam in the second half of the year.

Friday’s report “is another confirmation of a really spectacular fourth quarter for California,” said Brad Williams, senior economist in the California Legislative Analyst’s Office.

Based on the surging income tax revenues that flowed into the state’s treasury late in the year, Williams said he believes the preliminary employment figures released Friday actually understate job growth in California.

One of the few downbeat notes was that the state’s jobless rate of 4.9% remained above the national mark of 4.1%. Still, California is adding jobs faster than the rest of the country. The state’s nonfarm job growth was 2.9% last year, versus a national gain of 2.1%.

For Southern California, which began its recovery later than the Bay Area, Friday’s report was particularly encouraging. The southern half of the state is now leading the way in job growth, with unemployment in most counties falling either to record lows or, at least, the lowest levels in decades.

Orange County, for example, posted a December jobless rate of 2.1%, the lowest since the county started keeping records in the late 1940s. In November, the county’s rate was 2.4% and in December 1998 it stood at 2.5%.San Diego County’s jobless level last month of 2.5% was the lowest in more than 40 years, and off from 2.8% in November and 3% in December 1998.

Even Los Angeles County, which took the hardest hits in California during the recession of the early 1990s, is bouncing back. In December, the county’s jobless rate dipped to 5.7%, the lowest since July 1990. In November, the county’s rate was 5.8% and in December 1998 it was 6.8%.

While job growth has slowed in the Bay Area, that may be largely because there are so few available workers to hire. San Francisco’s jobless rate last month was 2.3%, extraordinarily low for a major urban area. Nearby Marin and San Mateo counties shared the lowest jobless rates in the state, 1.4%.

What’s more, the Bay Area has been a source of many high-paying jobs in high technology, making its showing particularly impressive.

“Silicon Valley may be running out of room, and running into cost constraints, but it’s still the center of the universe for anything related to the Internet,” said Tom Lieser, executive director of the UCLA Anderson Business Forecast.

In December, eight of the nine major industry groups showed employment increases. The only job loser was the small mining industry, whose employment fell by a mere 200 jobs.

The construction industry, for example, kept booming in December. Its job total is up 8.9% over the past 12 months, the highest of the nine major employment categories.

The strength of the business is clear to people such as Tom Newbro, director for the Air Conditioning and Refrigeration Training Trust apprenticeship program serving Los Angeles and Orange counties. Among the 200 apprentice mechanics in the program, Newbro said, “unemployment is maybe 1%, here in the middle of the winter. We’re in a really great economic time,” with many of the apprentices working overtime hours.

The service sector, particularly business services, also kept booming. Gov. Gray Davis held a news conference Friday at the United Parcel Service terminal in downtown Los Angeles to highlight how businesses such as UPS have expanded.

Davis pointed out that Internet commerce has been a boon to companies such as UPS, which transports many of the goods ordered by consumers via their home computers. He also lauded UPS for hiring over the year 1,300 workers who previously were on the welfare rolls in California.

For the month of December, however, the biggest job gainer of all was retailing, whose employment rose 26,300. Williams said that increase may have been due, in part, to later-than-usual holiday season hiring. He theorized that “stores weren’t able to hire employees and get them on the payroll as soon as they have in the past because they’re harder to find.”

The continued economic strength will mean further state budget windfalls. In the fiscal year beginning July 1, the state will collect $3 billion more than the Davis administration estimated in Monday’s budget proposal, the state Legislative Analyst said Friday.

Additionally, Sacramento is ending the current fiscal year, 1999-2000, with at least $2.9 billion more than budget analysts thought.

Times staff writer Dan Morain in Sacramento also contributed to this story.

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

More Good News

California’s jobless rate remained at 4.9% in December. A look at the job markets statewide and by county:

December unemployment rates in Southern California counties:

By County

County* Dec. ’99

jobless rate

Los Angeles

Orange

Riverside