Nearly 100,000 private sector jobs were created in California last month, the best month-over-month jobs performance of the California economy in years. Most sectors showed strength, especially construction, information, business services and tourism. Only two sectors showed minor declines – state government and retail trade.
California’s unemployment rate, from a different survey and seasonally adjusted, fell from 12.4% to 12.2% in February. But this change should be viewed cautiously. Most of the drop in the unemployment rate was attributable to a drop in the labor force, and only to a lesser extent to an increase in employment. Growth in the labor force over the next several years, both from natural increase and from discouraged workers returning, will further dampen the decrease in overall unemployment rates.
However, regional differences still strongly characterize California. On a seasonally unadjusted basis coastal counties’ aggregate unemployment rate was 11.5% while inland counties’ rate was 15.7%. Coastal counties saw their aggregate rate drop by nearly a half percentage point last month, while inland counties’ aggregate unemployment rate fell by only two-tenths of a percentage point.
The chart below shows that California has probably hit the bottom in job losses, but our recovery will be long and regionally uneven.
