Job Creation in State Continues to Be Strong
California’s economy continued to hum in August, generating 14,500 jobs and bringing to 1.9 million the number created since the state’s last recession began 10 years ago.
The California jobless rate remained unchanged at 5.1% in August, the state Employment Development Department reported Friday.
Though California continues to outstrip the nation in job creation, its unemployment rate still stands a full percentage point above the national 4.1% figure, in part because its youthful population and giant agriculture industry are typically plagued by higher jobless rates.
“Though the jobless rate in California remains the same from the prior month, job growth in the state continues to be well ahead of the nation and has been positive now for 19 consecutive months,” department Director Michael S. Bernick said.
Though the number of nonfarm payroll jobs added to the California economy was about half the 32,300 created a month earlier, it still left the year-over-year pace of growth at 3%, compared with the 1.9% national average.
Bernick said the vitality of the state’s role in international trade was especially evident in August, when transportation and utility-related jobs grew by 4,700, more than that of any other industry. Much of that growth was in the trucking and ports segments of those industries.
Retail stores added 3,400 jobs, the second-highest gain for an industry in August, with many of those positions created at restaurants, according to the state’s report.
Only mining and government employment suffered job declines.
Los Angeles County unemployment also remains above the state and national averages at 5.7%, yet that’s down from 6% in July.
And although the Los Angeles rate is above state and national averages, that doesn’t mean it’s easy for companies to find new workers, said H. Michael Hogan III, chief financial officer of 3D Systems Corp., a company that makes machines that convert computer drawings into three-dimensional plastic models.
“We are often faced with a choice of taking someone with a little less experience than we might like for the position or paying a higher wage to get the right experience level,” Hogan said. “It’s harder to attract people in all parts of our business than it was two years ago.”
The job market is even tighter in Orange County, which saw its unemployment rate fall to 2.7% in August from 3.1% in July. Among California counties, only three--in the San Francisco Bay Area--had lower rates.
Analysts cited encouraging trends in Friday’s numbers. Both the number of people receiving unemployment insurance checks and those filing first claims for jobless benefits have declined steadily during the last three months.
“If you look at the reasons why people are saying they are unemployed, you can also see how strong the job market is in California,” said Mary Daly, an economist with the San Francisco branch of the Federal Reserve Bank.
“The number of people who have lost jobs has gone down steadily over the past year while the number of people who have left jobs voluntarily has increased,” Daly said.
Moreover, the hot job market continues to push unemployment rates among Latinos and African Americans in California to historical lows, said Cecilia Conrad, associate professor of economics at Pomona College.
The jobless rate for Latinos was 6.4% in August, compared with 7.7% a year earlier. It was 8.2% for African Americans, compared with 8.7% a year earlier and double-digit figures in 1998.
“There’s no doubt that economic growth has turned into jobs for people at the bottom, but only recently has there been any evidence that wages also are responding,” Conrad said.
“What’s held wages down is that there seems to be more people to fill these low-wage jobs, especially in Southern California.”
Conrad cited welfare reform initiatives and immigration as suppliers of entrants into the work force.
Unemployment Dips
Orange County’s unemployment rate, which is not seasonally adjusted, declined to 2.7% in August, matching the rate a year ago, according to preliminary figures. The monthly trend:
Aug. ‘00: 2.7%
Source: Employment Development Department
