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THE TIMES 100 : The Best Performing Companies in California : INDUSTRY REPORT : They May Not Be Mentioned, But They're Certainly Notable : Many companies not on The Times 100 list for various reasons account for a big chunk of the state's employment and help power the economy.

April 30, 1991|MARTHA GROVES | TIMES STAFF WRITER

California's publicly owned behemoths--the Chevrons, Safeways, Hewlett-Packards and Lockheeds of the world--aren't the only game in town, not by a long shot.

Consider that 42.5% of the state's private-sector employment is in small businesses with fewer than 100 employees.

Consider that 98% of the state's 475,000 companies have fewer than 100 workers.

Consider that, of California's 13.4 million job holders, 1.1 million are self-employed.

And consider that the nine-campus University of California has more than 126,700 employees, about 4,000 more than a year ago and nearly twice the level of Pacific Telesis Group, the state's largest publicly held employer, with 63,657 on the payroll here. Not to mention that the City of Los Angeles employs more than 34,000 workers, with an additional 11,000 at the Department of Water and Power.

To be eligible for inclusion in The Times 100 supplement, companies must be publicly owned and based in California. Therefore, the lists omit a plethora of privately held companies based in California and elsewhere, as well as publicly held corporations with headquarters outside the state (or, increasingly, outside the nation) and countless public agencies, schools and nonprofit organizations.

The good news is that companies with headquarters outside the state provide employment for as many as half of California's workers, according to an educated guess by Jack A. Kyser, chief economist for the Los Angeles Area Chamber of Commerce. The bad news is that many of the jobs that go hand-in-hand with a headquarters operation--accounting and legal services, purchasing and printing--are being filled outside the state.

"It hurts not to have the companies based in California," Kyser said. "You always want to have the corporate headquarters. That's the jackpot."

Nonetheless, these "significant others" account for a big chunk of the state's employment and help power the economy.

Among the most significant of the "others" is General Motors Corp., Detroit's auto giant. Operating in Southern California, GM's Hughes Aircraft Co., Delco Systems Operations and Van Nuys auto plant accounted for 56,600 jobs in 1990, with payrolls amounting to $2.2 billion. At Hughes Aircraft alone, the job count at year-end 1990 was 45,000. All told, GM Hughes Electronics Corp., which includes Hughes and Delco, had $11.4 billion in sales for 1990, according to MZ Group in San Francisco.

Unfortunately for thousands of Californians, the employment trend at Hughes and other aerospace and defense giants has been decidedly downward because of defense budget cutbacks and the national recession.

According to a recent UCLA study, the state's aerospace industry--a key force in the California economy, with its relatively high-paying jobs--now employs 322,000 people, down about 52,000 from 1987, the peak of the Reagan Administration's defense buildup. More than half the loss occurred in the last year, and UCLA's Business Forecasting Project expects that number to drop to 294,000 by the end of 1992.

General Dynamics, based in St. Louis, last August consolidated two divisions in Pomona and Rancho Cucamonga into one, the newly named Air Defense Systems. Employment there is down to 5,800 from more than 7,300 when the operations merged and from 8,450 at the end of January, 1990.

At year-end 1990, employment at the company's four other operations in California was 17,873, but that has now shrunk to 17,640.

With California and the rest of the nation mired in a recession, 1990 was a year of layoffs and cost-cutting that jolted many employers and workers. Retailers, major job providers, were particularly hard hit.

Seattle-based Nordstrom, faced with a severe spending slowdown, "looked at the economic situation last August, and we realized we were just overstaffed," said Joe Demarte, vice president of personnel. The sales staff was cut back. Although three new stores were opened in California in the past year, employment actually shrank--to 13,600 from 14,500.

The California employment of Dayton Hudson, based in Minneapolis, continues to grow because of store openings. Of the company's 708 stores at year-end 1990, 206 were in California. The company's Mervyn's division, with headquarters in Hayward, had 31,000 employees, and the Target discount chain had 19,700. About 30% of the company's nearly $15 billion in sales comes from California.

As of August, 1990, Chicago-based Sears, Roebuck & Co.'s employment in the state--at its stores and its Allstate insurance, Dean Witter brokerage and Coldwell Banker residential real estate offices--had shrunk by more than 1,800 to 47,800 from 1988 levels. By year-end, the corporation plans to reduce its merchandising work force by 33,000, or about 8%, with an unknown number of cuts coming in California.

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