State’s Jobless Rate Climbs to 6.4% in March
Signaling that the economic recovery has yet to reach the job market, California’s unemployment rate rose to 6.4% in March, matching the five-year high set at the beginning of the year. Last month’s rise from February’s revised 6.2% rate was the result of anemic job creation. In March, California employers boosted their payrolls by only a net 200 jobs, underscoring their continued reluctance to hire workers.
Overall, California’s March employment figures reflected an economy in transition, with employers hesitant to hire new hands until they are certain the recovery has legs. The good news is that California’s labor market appears to have leveled off after losing an average of 2,200 jobs a month in 2001. The bad news is that the world’s sixth-largest economy isn’t creating many net new jobs, which could lead to a continued uptick in the unemployment rate even as the economy continues to improve.
“We are in an in-between period,” said Howard Roth, chief economist with the state Department of Finance. “Employers aren’t yet convinced ... and committed to hiring.”
California’s rise in joblessness reflected the nation’s, which grew to 5.7% in March from 5.5% in February. But while the rest of the nation managed to eke out a small net gain of 58,000 jobs in March, California’s job machine appears to be at a virtual standstill, with new hires by some companies canceled out by continued layoffs at others.
“There is nothing pulling us out of the slowdown,” said Tom Lieser, senior economist with the UCLA Anderson Forecast. “There is no engine moving us forward.”
The jobs that are being added are mainly in Southern California, which continues to outshine the hard-pressed Bay Area. Orange County’s March unemployment rate was 3.7%, unchanged from February, and San Diego’s rate likewise held steady at 3.8%.
But it is the Inland Empire that is leading the pack in job creation. Last month, Riverside and San Bernardino counties added a combined 3,700 nonfarm jobs, putting the area nearly 34,000 jobs ahead of where it was in March 2001. That 3.3% year-over-year growth rate is the highest of any large metro area in California. It helped push Riverside County’s March jobless rate down to 5.2% from 5.5% in February, while San Bernardino’s rate dropped to 5.1% from 5.2% the previous month.
John Husing, an economist who studies the Inland Empire economy, credits the region’s growing population, affordable housing, abundance of low-cost developable commercial land and pro-business climate for the area’s continued strength.
“It’s less expensive to live and do business here,” Husing said.
In contrast, Los Angeles County has about 42,000 fewer jobs than it did a year ago, as its March unemployment rate rose to 6.7%, up from a revised 6.6% in February. One piece of good news is that the motion picture industry is showing some signs of life coming off a tough year marred by runaway production and two threatened strikes.
The state added 9,100 motion picture jobs in March--nearly 40% of them in Los Angeles County--reflecting an increase in movie shoots on local streets. Last month saw 723 filming days for feature films in Los Angeles County, the highest since June, said Nancy Sidhu, senior economist with the Los Angeles County Economic Development Corp.
“We’re definitely seeing more white [movie] trucks around, particularly in downtown Los Angeles,” Sidhu said. “We have come part of the way back.”
California’s services and trade sectors were the only areas to show net job gains in March. Transportation and public utilities led the losing sectors with 6,900 job losses, while manufacturing shed 2,000 jobs, marking its 14th consecutive month of decline.
The government sector recorded its first job loss in six months, declining by 1,200 jobs. The state of California shed the most jobs in March--800--reflecting a slowdown in the hiring of teachers in some regions and government belt-tightening because of the budget crunch, economists said.
The Bay Area continues to bear the brunt of California’s slowdown. The jobless rate in Santa Clara County, the heart of Silicon Valley, was 7.4% last month. That’s slightly better than the 7.5% it registered in February, but it’s a far cry from the 2.2% jobless rate recorded in March 2001.
Younger Californians suffered the highest unemployment in March. The rate for teenagers ages 16 to 19 climbed to 17.6%, compared with 4.8% for workers over the age of 25.
The unemployment rate for blacks reached 9.7% in March, up sharply from 9.1% in February. Latino unemployment increased slightly to 7.3% from 7.2% the previous month, and the rate for whites edged up to 5.5% in March from 5.3% in February.
San Luis Obispo County posted the state’s lowest unemployment rate at 3.2%. Colusa County reported the highest at 23.2%.
