April Jobless Rate Edges Up in O.C., State
California’s unemployment rate edged up to 4.8% in April, marking the first time in six years that joblessness statewide climbed two consecutive months and providing strong evidence of a cooling economy. In March, unemployment in California was 4.7%.
Figures released Friday by state officials also showed rising unemployment in Los Angeles County, with the jobless level climbing to 5.1% in April from a revised 4.9% the month before.
Orange County’s unemployment rate also inched up to 2.5% from 2.4% the previous month, but remained near historical lows. Despite a one-month dip in manufacturing, employers in the county, particularly in the services industry, continued to add jobs at a robust pace.
“We are really barreling along,” said Esmael Adibi, director of the Center for Economic Research at Chapman University in Orange.
All told, however, the latest statewide employment statistics underscore how the U.S. slump combined with the state’s energy and high-tech troubles have begun to dampen business expansion in much of California.
The state economy, after booming in 2000 and continuing to expand surprisingly briskly at the beginning of this year, “is now on a slower growth path,” said Brad Williams, senior economist for the California Legislative Analyst’s office.
Analysts emphasized that the comedown for California as a whole is far less severe than the national downturn. Still, they said a sharp drop in technology spending has led to an abrupt end to the boom in Silicon Valley and other parts of the Bay Area.
Taking all five Los Angeles-area counties and San Diego together, the jobless rate was 4.1% in April, unchanged from March, but down from 4.4% in April 2000. By contrast, the nine-county Bay Area posted a jobless rate of 2.8% last month, up from 2.6% in March and from 2.4% in April, 2000.
Analysts expect the state economy to cool further this year, as a result of everything from rolling power blackouts to high gasoline prices to the downward pull of slowdowns nationally and overseas.
Williams said layoffs at major technology-manufacturing companies, and slower growth in computer services fields, are especially troubling because they had been the source of so many high-paying new jobs in recent years. The technology boom “propelled a lot of growth in the state, and that’s reversing,” Williams said. “Just as it had a magnifying effect on the way up, it will have a magnifying effect on the way down.”
He predicted that sales of homes, cars and other consumer goods will taper off substantially, particularly in Northern California, and said that the state’s unemployment is likely to rise to somewhere between 5.5% and 6% by year’s end.
Still, there also was some reassuring news in Friday’s employment report. The state gained 17,300 jobs in April. That was barely one-third of the monthly average last year but still impressive in a month when the nation lost 223,000 jobs.
“So far, we’re dodging the worst of the national weakness,” said Ted Gibson, chief economist for the California Department of Finance.
The biggest job gains were in the services, government, retailing and construction categories, whereas the declines mainly came in manufacturing.
Michael S. Bernick, director of the California Employment Development Department, said the state’s job-placement offices “are not seeing the frenetic pace that we saw in much of 2000, but our people still are reporting a regular flow of job openings.”
In Orange County, businesses added 49,400 nonfarm jobs over the past year. The lively growth was fueled largely by new positions in the services industry--a sprawling category that includes software engineers, temporary-help workers and janitors.
The sector’s brightest spot was amusements, which added 4,200 jobs, up a whopping 12.5% over the past year as the area continued to benefit from the recent Disney Resort expansion in Anaheim.
The manufacturing sector, however, lost 600 jobs in April after gaining the same number the previous month. The losses were spread throughout, said Ann Marshall, the state’s labor market analyst for Orange County.
Still, manufacturers have added 4,800 jobs over the past year, a healthy 2.1% increase. And despite higher energy costs and rolling blackouts, factories have added 300 positions since January.
Construction in the county was flat last month, but the sector added 6,200 jobs over the year, an 8.2% boost. In fact, all industries have increased their payrolls for the year.
The county’s numbers have remained strong despite ongoing layoffs because dismissed workers are quickly landing new jobs, Adibi said.
Analysts said the state’s rising unemployment rate stems more from an influx of new job hunters to the labor market than from layoffs. They said California’s continuing economic momentum, at a time when other regions are hurting, means that the state might be drawing more job hunters from other states and countries.
California business forecasters, both inside and outside government, continue to predict that the state will avoid falling into a recession. Although there is no official definition of a recession for the state, most analysts consider it a sustained period of declining employment. Leading California business forecasters continue to foresee moderate job growth of close to 2.5% this year, versus the rapid 3.8% gains in 2000. Adibi predicts an annual growth rate of 3.3% to 3.5% for Orange County.
The jobless rates for California and Los Angeles County also remain fairly close to historic lows. The state unemployment level of 4.5% in February was its best since 1969.
Likewise, the county’s rate of 4.7% the same month also was a 32-year low. In addition, the most recent jobless rates for both the state and county remain better than the levels of a year ago.
Despite small rises in unemployment in Los Angeles and Orange counties last month, forecasters generally are upbeat about Southern California’s prospects this year. The region’s service industries continue to add jobs, the construction fields show momentum, and manufacturing, while declining, is doing far better locally than nationally or in the Bay Area.
As a result, most analysts say the five-county region--comprising Los Angeles, Orange, Riverside, San Bernardino and Ventura counties--should account for most of the state’s job growth this year. San Diego is expected to keep growing too.
“Even if the nation goes into a recession--and I don’t think we will--we’ll fare pretty well,” said Joseph P. Magaddino, director of the Office of Economic Research at Cal State Long Beach. “Goodness knows, we deserve it, after going through the wretched period of the early 1990s,” Magaddino added, citing the region’s devastating recession a decade ago that stemmed from defense industry cutbacks and slumps in real estate and finance.
Among the state’s 58 counties, the lowest unemployment rates came in Sonoma, at 2.3%, followed by Orange and San Luis Obispo counties, at 2.5%.
For blacks and Latinos, unemployment rates changed only slightly and remained near record lows. The jobless rate for Latinos inched down to 6.6%, from 6.7% in March, while joblessness among African Americans edged up to 7.4% in April, from 7.3% the month before.
California’s rural areas and small cities continue to suffer some of the worst unemployment in the nation, and the national slowdown could depress those areas further. The highest joblessness among the counties came in Imperial, at 19.8%, followed by Tulare, at 15.3%, and Merced and Colusa, both at 15.1%.
Nationally, as previously reported, the unemployment rate rose to 4.5% in April, up from 4.3%. The gap between joblessness California and nationally is now the narrowest it has been since September 1990, when the state was sinking into its recession.
In the other Los Angeles-area counties, jobless rates declined in April. Riverside County’s rate was 4.5%, down from 4.6% in March; San Bernardino’s level was 4.4%, down from 4.5%; and Ventura’s was 3.3%, down from 3.6%. San Diego, however, saw its jobless rate inch up to 2.7%, from 2.6%.
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O.C. Jobless Rate
The county’s unemployment rate, which is not seasonally adjusted, was 2.5% in April after reaching an all time low of 2% in December. The monthly figures:
