California Gets Excited over Tepid Job Growth

Monday, July 23, 2012

Buoyed by having experienced its 11th straight month of job growth, Californians tried to forget that the June improvement was miniscule; lower jobless numbers could be accounted for by discouraged job seekers giving up the hunt; and the state still has the third worst unemployment in the nation.

The state unemployment rate dipped to 10.7% in June, while U.S. joblessness held steady at 8.2%, according to the California Employment Development Department (EDD). The unemployment rate is determined through a federal survey of 5,500 California households.

More than 1.97 million people are still looking for work in California, down 213,000 from a year ago. Although nonfarm industries experienced a net gain of 38,300 jobs, fewer job seekers are actively looking for employment. Economists say the state needs to add 100,000 jobs a month for it to be considered in real recovery. Still, there were some positive trends.

“The recovery is kind of broadening out,” according to Dennis Meyers, principal economist with the state Department of Finance, who noted growth in construction and the leisure and hospitality sector beyond gains the past year in technology. He did not note the declines in mining and logging, manufacturing, educational and health services, and government.

“Construction was our biggest major drag for a long time,” Esmael Adibi, director of the A. Gary Anderson Center for Economic Research at Chapman University told the Los Angeles Times. “But now we're coming back stronger in terms of percentages.”

EDD labor market consultant Justin Wehner said the numbers would have looked even better if kids exiting school weren’t looking for jobs.

Nationally, 27 states suffered increases in unemployment last month, 12 stayed the same and 11 (led by California) reduced unemployment.

–Ken Broder


To Learn More:

It's Not Clear if California's Economy Is Growing at All (by Gregor Macdonald, Business Insider)

California’s Unemployment Rate Decreases to 10.7 Percent (Employment Development Department) (pdf)

California Unemployment: Getting Better, but the West Still Bad (by Matthew DeBord, KPCC)

California Gains Jobs, Led by Trade and Tourism (by Ricardo Lopez, Los Angeles Times)

Sacramento Job Growth Accelerates as California Unemployment Declines (by Dale Kasler, Sacramento Bee)

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