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State's jobless rate falls to 12.4% in January

As the nation's February unemployment report shows a stronger recovery, California releases figures that say it added just 12,500 jobs in January. The state's jobless rate declined from 12.5% in December.

March 05, 2011|By Alana Semuels, Los Angeles Times

California's fragile economy is beginning to recover, but hiring continues to lag behind the nation, particularly because of cutbacks in state and local governments, according to new state data.

"As far as California, I do think we're running behind," said Nancy Sidhu, chief economist at the Los Angeles County Economic Development Corp. "In California's case, moving up off the bottom is going to be a little slow."

That weakness in the economy is likely to continue as both the state and the nation grapple with budget shortfalls that are likely to lead to hiring freezes and job cuts. Gov. Jerry Brown said he would cut more than $25 billion from the state budget if voters and lawmakers don't approve more taxes.

That leaves job creation to the private sector, which has proved reluctant to hire thus far. California employers added just 12,500 jobs to payrolls in January, pushing the unemployment rate down to 12.4%, from 12.5% in December, according to the state Employment Development Department.

The nation's labor market was also weak in January, when employers added just 63,000 jobs. But it began to pick up in February, according to a new report Friday, which showed that U.S. employers added 192,000 jobs in that month. The U.S. unemployment rate fell to 8.9% in February, down from 9% in January.

The state's February report won't come out until later this month.

There are still 2.2 million unemployed Californians, and many of them, such as Amanda Yollin, feel left out of a labor market that often discriminates against the long-term unemployed.

Yollin, a 27-year-old Northridge resident, has been looking for a job since June 2010. She's on food stamps and general relief but lost her apartment Friday. She's planning on staying with friends — or on the street — until she finds work.

"I'm seeing all my friends move back home to live with their parents because they can't afford to pay the rent," she said. "But I'm on my own, and it's a hard city to make it in."

Yollin, who has worked in retail, theater and veterinary sciences, was the salutatorian of her high school class and has taken some college classes. But employers tell her she's either too qualified or not qualified enough.

"It's just a horrible economy," she said. "I have no job, no money, no savings. I just used my last five bucks to buy some food."

In January, the state lost jobs in information, financial activities, professional and business services, educational and health services and leisure and hospitality. Information posted the biggest losses — the sector was down 9,600 jobs.

There were some positive signs in the labor market. January marked the fourth consecutive month of job growth. And California's job gains made up nearly 20% of the nation's increase in January, said Michael S. Bernick, former head of the Employment Development Department. That bodes well for February: The nation added more jobs, so California should as well.

But part of the problem in California is that construction, which usually leads the way out of the recovery, is still very weak. The industry is still down nearly 400,000 jobs from its peak employment in February 2006.

"Three sectors — construction, financial activities and government — are taking the oomph out of the recovery," said Esmael Adibi, a Chapman University economist. "Job creation is what is going to bring housing back, but with this pace of job creation, we're not going to see a quick turnaround."

Los Angeles County's unemployment rate fell to 12.9% in January, from a revised 13% the month before. The county lost 77,300 jobs over the month, shedding positions in trade, transportation and utilities and professional and business services. Observers say the large monthly job losses result from the retail sector dropping seasonal workers after the holiday season ended.

Orange County's unemployment rate rose to 9.2% in January, from 9.0% in December. The county lost 21,300 jobs, with retail trade and government employment leading the losses. In the Riverside and San Bernardino County metropolitan area, employers shed 20,000 jobs from payrolls in January, pushing the unemployment rate to 14.2%, up from 14% in December.

Unemployment rates remained high throughout the state, with eight counties posting seasonally unadjusted unemployment rates above 20%. Those counties were Colusa (27.8%), Imperial (25.1%), Merced (21.2%), San Benito (20.6%), Siskiyou (21%), Sutter (21.5%), Trinity (21%) and Yuba (20.3%).

Charles Chacon, 45, has been looking for a full-time job since the economy turned sour in 2008. The West L.A. construction worker, who attended cinematography school, says he owes $85,000 in school loans and that creditors keep calling to collect.

"I tell them, 'I have no money. How am I going to give you money?' " he said.

He finds sporadic construction jobs but said it's a far cry from 2007, when he could easily make $3,000 in a week and a half.

"Now, I'm willing to work anything," he said. "It's pretty bad out there."

alana.semuels@latimes.com

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