California employers add 80,700 jobs in July; jobless rate falls to 6.2%
California’s economy surged in July as employers added 80,700 new jobs, the largest monthly employment gain in the last year.
In a promising sign for the state’s economy, a wide range of high-paying and low-paying jobs were added, “lifting almost everyone in the economy,” economist Sung Won Sohn said.
Meanwhile, the state’s unemployment rate fell to 6.2% from 6.3% in June — its lowest level in more than seven years. Nationwide, the jobless rate remained steady at 5.3% last month.
Economists said the lower unemployment rate is a reflection of the state’s strong jobs recovery. Since July 2014, the Golden State has added 494,300 net new jobs, a pace of 3.2% growth that outstrips the national average of 2.1%. A year ago, the state unemployment rate was 7.4%.
“Despite China, despite the drought, despite the port strikes earlier this year, the state continues with very impressive job growth,” said Stephen Levy, director of the Center for Continuing Study of the California Economy. “Nothing’s perfect, but it’s hard to beat 80,000 jobs and a decline in the unemployment rate.”
The professional and business services sector had the biggest month-over-month bump in jobs, adding 22,300 positions in July.
Real estate-related jobs have also risen significantly as demand for commercial buildings and apartments, particularly in the Bay Area and in Southern California, has boomed. Construction added 3,000 jobs.
Other industries showing strong growth include leisure and hospitality, with 19,100 new jobs, and the trade, transportation and utilities sector, which added 8,400 positions.
The increases in the construction sector, as well as in manufacturing and professional and business services, are positive signs that middle- and higher-wage jobs are on the rebound, Levy said.
“Finally, a little bit of optimism that we may regain some of those middle-wage jobs,” he said.
Still, there are “pockets of worry,” Sohn said.
Among them: slowing exports as countries whose currencies have depreciated significantly against the strong dollar buy fewer California products and services.
The devaluation of the Chinese yuan last week also sparked fears that foreign tourism to California would suffer.
“Tourists from China have already fallen, and additional decreases are expected,” Sohn said. “In addition, visitors from other Asian countries, Europe and Latin America have slackened.”
A tourism slowdown and even a drop in exports would not be a significant problem for the state’s diverse economy, said Scott Anderson, senior vice president and chief economist at Bank of the West.
“It’s a large economy,” he said. “There’s a lot of drivers there that are moving in the right direction. We’re coming up on almost our third year of real strong job creation in California, and there’s no indication that that’s going to change any time soon.”
The only major industry to shed jobs was government, with 1,100 positions lost. Mining and logging, which includes the struggling oil industry, was flat month over month.
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