State Posts Moderate Job Gain in April

California added a net 20,400 payroll jobs in April, the state Employment Development Department reported Friday, a moderate rise that suggests the state’s growth remains solid but not spectacular.

The gain followed a revised increase of 21,000 net jobs in March and 27,700 in February.

“The state is showing steady, stable growth, which is a good thing at this point in the business cycle,” said Steve Cochrane, a regional economist who follows California for Economy.com.

“We’re pretty much marching in step with the national economy,” said Howard Roth, chief economist at the state Department of Finance. On a year-over-year basis, the state’s job growth is about 1.7%, on par with the nation’s, he said.

Economists were cheered by the broad nature of the state’s job gains in April, as nine of 11 industry categories posted increases, led by education and health services.

Unemployment remained unchanged at 5.4%, the lowest rate since 2001 but higher than the nation’s 5.2%.

After suffering from a sluggish job market through much of the recovery from the 2001 recession, the state and national job pictures appear to be improving. U.S. employers added a net 274,000 payroll jobs in April, a surprisingly strong showing that eased fears that the national economy might be entering a soft patch.

Economists say the state’s employers face the same challenge as their counterparts elsewhere: They can’t rely solely on productivity gains any longer. If companies need to expand to meet orders, they must hire new workers, as existing staffs can’t be squeezed much more.

The California and national economies also face some of the same hurdles that could slow future job growth, said Roth of the state Department of Finance. These include high energy prices and a lack of new government stimulus to build on President Bush’s tax cuts, he said.

The biggest risk for California’s economy might be higher mortgage rates, which could throttle the booming housing market. The state’s economy is overly dependent on housing, which has created construction jobs while boosting spending from homeowners relishing surging equity values, said Christopher Thornberg, senior economist at the UCLA Anderson Forecast.

“Housing’s been driving the show for the last few years,” Thornberg said. But the boom has covered up weaknesses in other sectors, such as manufacturing, he said.

The boost in construction jobs “makes the California labor market look stronger than it really is,” giving Californians “a false sense of security,” said Cochrane of Economy.com. “The state could slip behind if the housing market falters.”

On the plus side, California could benefit from increased exports resulting from a possible revaluation of the Chinese currency, the yuan, Cochrane said. A stronger yuan would make state agricultural and technology products cheaper in China and other Asian markets, he said.

The hottest category for April job growth, education and health services, added a net 6,500 positions on a seasonally adjusted basis, the state reported. That was followed by leisure and hospitality, up 6,300. Government jobs, which have lagged because of state fiscal woes, came in third with a jump of 4,600.

The two segments reporting declines were trade, transportation and utilities, down 3,600, and financial activities, off 1,800.

Several Southland counties continued to boast relatively low unemployment rates, led by Orange at 3.5%, Santa Barbara at 3.8%, San Diego at 4%, Ventura at 4.1%, Riverside at 4.7% and San Bernardino at 4.8%. In Los Angeles County, the biggest of the bunch, 5.4% of the workforce was jobless. Imperial County had a 14.6% unemployment rate, the state’s highest.