SACRAMENTO — California's moribund construction and real estate industries helped push the state unemployment rate to 6.8% in May, its highest level in nearly five years.
The state Employment Development Department reported Friday that joblessness in May rose six-tenths of a percentage point from the previous month and was a dramatic 1.5 percentage points higher than in May 2007.
And the outlook is likely to get worse for California -- at least for the rest of the year, experts said. Economic concerns, fueled by higher oil prices, also sent stocks lower Friday, with the Dow Jones industrial average falling 220.40 points to 11,842.69, the lowest level in three months.
"Although some forecasting groups continue to debate whether or not the economy is heading into a recession, these numbers should make it perfectly clear that the state is already in a recession," Beacon Economics, a Los Angeles-based research firm, said in an analysis of the jobless data. "The only question now is, how long and how bad will it be?"
Other economists noted that California's seasonably adjusted unemployment increase, although large, wasn't unexpected. It roughly paralleled a half-percentage-point rise in the national rate, which increased to 5.5% in May, as previously reported.
California's May unemployment rate was the fifth-highest in the nation, behind Michigan, Rhode Island, Alaska and Mississippi, according to the U.S. Bureau of Labor Statistics.
The total number of unemployed people in California last month was 1.26 million, up 115,000 from the previous month and 300,000 higher than in May 2007.
The report said California posted a net loss of 10,900 jobs in May from the month before, mostly in residential and commercial construction. Workers who once made good wages in California's formerly booming real estate market say they're frustrated and increasingly desperate.
"Absolutely, it's getting worse," said Debbie Smith, who worked as an office manager for a real estate magazine publishing company in Ventura before being laid off last September. "There's nothing out there, believe me."
Smith said she had only one strong job possibility in the last nine months, but "it fell through, I think, because I'm 54."
The dropoff in real estate and construction also plagued the Los Angeles metropolitan area, where unemployment rose to 6.7% in May from a revised 5.9% in April and 4.9% a year earlier. At a time of year when building traditionally is in full swing, the number of construction jobs was off half a percentage point for the month and 6.7% from May 2007.
