California adds 44,200 jobs in August
California outpaced its recent job growth as employers added 44,200 nonfarm positions in August — far more than any other state.
But for the third straight month, the state unemployment rate remained flat at 7.4%, according to Employment Development Department data released Friday. That’s higher than the national rate, which edged lower last month to 6.1% from 6.2% in July.
The job recovery in California, however, has more momentum than in the nation as a whole.
This time last year, 8.9% of workers in the state were unemployed. Now, more Californians are streaming back into the labor force, which expanded by 16,400 people last month to nearly 18.6 million available workers.
But employers are hiring enough to absorb the expanding pool of workers, which contributed to the stagnant unemployment rate, economists said. Some 17.2 million Californians had jobs in August, up by 16,000 from July. But the number of unemployed workers was also up, rising by 1,000 to nearly 1.4 million total.
“If we want this to go down, the job creation has to pick up more than it is now,” said Esmael Adibi, director of the A. Gary Anderson Center for Economic Research at Chapman University.
At a job fair hosted earlier this week by Citadel Outlets in Commerce, job seekers milled about in the intense heat. Many leaned against store windows to fill out applications or positioned themselves near entryways spewing out cool air.
Rafael Moreno, 38, huddled with an application on a bench near Old Navy. The East Los Angeles resident — wearing a collared shirt, striped tie and slacks — was laid off from his insurance agent job in April. He’s losing hope that he’ll land an office job in clerical work or administration.
In five months, he’s sent out at least 20 applications but only landed interviews with Bank of America and AT&T — both of which went nowhere, he said. Part of the problem is that he doesn’t have a bachelor’s degree, only an associate’s.
“That hasn’t been enough for employers,” he said.
In the last month, nearly a third of all new jobs created nationally originated in California. By comparison, Florida added 22,700 positions and Texas boosted payrolls by 20,100 jobs.
But by percentage increase, the largest leaps in employment in August were made by New Mexico, with a 0.6% upswing, and Nebraska, which enjoyed a 0.5% lift.
Even accounting for California’s massive population, the nation’s largest, many economists expressed surprise at the job surge. Several remained wary of government data, pointing to frequent revisions and fluctuations.
“To be candid, I’m not sure I believe it,” said Christopher Thornberg, co-founder of Beacon Economics.
Other states hit hard by the recession, including Illinois and Nevada, have also seen more improvement in unemployment rates than California over the last year.
“In some sense, California is a little more in the middle of the pack,” said Alec Levenson, an economist and senior research scientist at USC’s Center for Effective Organizations.
The data released Friday show the construction as well as the professional and business services industries leading the upswing in California.
In the midst of a two-year rebound, the residential and commercial construction sector added 35,600 jobs compared with August 2013, a 5.6% surge. An additional 93,000 professional and business services jobs contributed to a 4% upswing in that sector.
“It’s a great time for these businesses,” Thornberg said. “The economy’s heating up, there’s more demand for their services both domestically and internationally, and more high-skilled workers are moving to California because it’s paradise.”
In the last year, manufacturing and financial activities were the only industries that lost jobs.
Some 411,000 Californians received unemployment insurance benefits in August, down more than 15,000 from July. The government received fewer claims as well — 47,640 from 56,565.
With the holiday season fast approaching, many businesses will be looking to enlarge their head counts.
Wal-Mart Stores Inc. said Thursday that it plans to hire 5,000 seasonal workers in Southern California as it heads into Christmas. The chain said it hopes to add 60,000 holiday employees to its ranks nationwide, nearly 10% more than it did last year.
Los Angeles County’s unemployment rate remained at 8.1% in August, an improvement from the 9.9% unemployment rate of a year ago.
Over the last year, the state’s fastest rates of job growth have been centered in the Bay Area. But employment gains in the Inland Empire, which posted 2.7% growth over the last year, are happening at nearly the same speed.
Riverside and San Bernardino counties were among the hardest-hit by the housing bust, and experts said growth over the last year points to how far the region had to dig out of the recession.
“It’s pretty normal to post these large gains, because you have a lot more slack,” said Kimberly Ritter-Martinez, an economist with the Los Angeles County Economic Development Corp. “You’re finally starting to see the Inland Empire catch up.”
Los Angeles County had a slower rate of job growth over the last year, and still has not recovered the number of jobs lost during the recession. But because of the sheer size of the county, it was responsible for nearly 60% of all jobs created statewide last month.
Economists say that Los Angeles County’s size and diversity of income generally mean much slower job growth than areas such as San Francisco and San Jose.
“Part of the county is like a coastal region, very diversified with professional services and healthcare,” said Adibi, the Chapman economist. “But part of the county has characteristics of the Inland Empire and Central California. Because of that, the overall growth rate is not as dynamic.”
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