State's Job Market Stuck in Neutral

Through the first six months of the year, California payrolls have increased by a mere 3,600 jobs, reflecting employers' skepticism about the strength of the economic recovery.

A separate report released Friday showed that consumers are having doubts of their own. The University of Michigan index of consumer confidence fell to 86.5 in July, down from 92.4 in June and 96.9 in May.

With few sectors beyond housing showing any real verve, economists say the state's job market, like that of the nation's, probably will remain sluggish for months to come.

"The economy is just plain looking flat," said Ted Gibson, former chief economist for the California Department of Finance. "We're really not doing any better or worse than the rest of the nation. We're just kind of sitting here."

California's 6.4% June unemployment rate equaled that of May's, which was revised upward from the 6.3% previously reported by state officials. California has 29,000 fewer payroll jobs than it did a year ago, and has seen its unemployment rate increase from 5.2% in June 2001. Last month, the national unemployment rate was 5.9% compared with 5.8% in May. A year ago, the U.S. jobless rate stood at 4.6%.

Although Southern California's labor market remained among the healthiest in the state, all the major counties reported increases in joblessness in June. Orange County's June unemployment rate was 4%, up from 3.7% in May. San Diego's June rate rose to 4.1% from 3.8% the month before. Riverside and San Bernardino counties posted 5.7% in June, up from 5.2% in May. June unemployment in Ventura County was 4.8% compared with 4.3% the prior month.

Los Angeles County remained the Southland's laggard. The county's unemployment rate hit a five-year high of 7.1% in June, up from a revised 7% in May, while its payrolls dropped by a net 800 job positions in June, led by continued declines in manufacturing employment.

Still, the Bay Area continues to bear the brunt of last year's economic slowdown. In Santa Clara County, the heart of Silicon Valley, the June unemployment rate bounced back to 7.6% after easing to 7.3% in May. In January 2001, that county's jobless rate stood at 1.7%.