Since the state’s employment peak in July, 2007, California has lost over a million jobs. Don’t lose sight of that grim statistic as we hear some qualified, “it’s-getting-worse-more-slowly-and-maybe-we’re-seeing-the-bottom-down-there-somewhere” news.
California’s latest unemployment rate, released last Friday, remained steady this month at 12.2%. Part of the reason is that the actual number of unemployed blipped down, and the labor force also shrank. Month-to-month changes should be viewed with caution: California’s unemployment rate is double what it was just 20 months ago, and is the fourth-highest in the country, behind Michigan, Nevada and Rhode Island. Inland rural California is suffering even worse; its 14.7% unemployment would be second-worst nationally.
Overall employment dropped again this month, but only by a hope-stirring 39,000 jobs. (This is about half the average monthly job loss from last November through June.) Major sectoral losses were in construction, information, manufacturing (durables), and private education. Job losses are also beginning to appear in the government sector. There may be some initial good news in some low wage industries, such as retail trade and tourism, but again, one-month changes should be viewed skeptically.
The news will actually start to get better when jobs are added to the economy, not when we merely lose fewer than the month before. That means the line on this chart (comparing California’s jobs picture in this recession with previous downturns) needs to turn north.
