Jobless Rates for State, County Continue to Fall

California’s job market continued on a roll in April, as the unemployment rate fell to 6.5%, its lowest level in more than seven years.

The state has now added more than 1 million jobs since the end of the recession four years ago, and is on a pace to add more than 400,000 jobs this year alone, according to Friday’s report by the state Employment Development Department.

One of the stars in the state’s comeback is Orange County, where 39,000 jobs have been added in the past year. At a tiny 3.1%, the county’s unemployment rate was higher only than the jobless rates of Marin and San Mateo counties and equal to that of booming Silicon Valley.

Orange County’s buoyant economy is “remarkable,” said Steve Cochrane, senior economist at Regional Financial Associates in West Chester, Pa.

The last time 400,000 jobs were created in California in a single year was in 1988--near the height of the boom years and just before the economy began to sour.

With the economic rebound now gaining speed, the number of jobs created in February through April of this year alone was about equal to the total created in all of 1994.

“That’s a big deal,” said Stephen Levy, director of the Center for Continuing Study of the California Economy in Palo Alto.

The 6.5% unemployment rate was down from a revised 6.6% in March and from 7.4% in April 1996. Last month’s rate was the lowest for the state since October 1990.

“California’s economy is in the midst of a strong expansion,” said Gov. Pete Wilson, in a statement accompanying Friday’s report. “Manufacturing, services, finance, insurance and real estate, and retail trade all gained jobs last month.”

While California’s unemployment rate overall is still well above the 4.9% rate for the nation, the gap is closing. At the current pace of job growth, the statewide unemployment rate could sink to 6% by the end of the year, said Levy.

Every additional job over 300,000 outpaces the growth of the labor force, cutting directly into the unemployment rate, he said. The benefits to state and local governments could be significant as the chronically unemployed return to the labor market. If the job growth continues, it could help welfare recipients move back into the work force, he said.

“We’ve come a long way” since the recession, said Tom Leiser, associate director of UCLA’s Business Forecasting Project. “If the nation continues to do well, California should continue to outgrow it.”

Orange County’s jobless rate, which, unlike the statewide figure, is not adjusted to account for seasonal variations, might edge up in the summer months when high school students hit the job market, said Esmael Adibi, director of Chapman University’s Anderson Center for Economic Research. But he expects favorable growth in the tourism sector to help absorb the teenage job-seekers.

The manufacturing sector in Orange County, particularly aircraft and related parts, showed strong growth last month. Services, finance and insurance also added jobs. “That’s really what is striking about this report. Every sector is showing positive growth,” said Adibi.

“To some extent,” said UCLA’s Leiser, Orange County “may be becoming our local version of Silicon Valley.”

In the statewide report, economists were most encouraged by April’s 10.5% jump in the level of construction industry employment from a year earlier. The growth was centered largely on nonresidential construction--which means that businesses are building facilities, said Bruce Smith, an economist at the state Department of Finance.

“That bodes very well for future job growth,” he said.

More construction would also provide a boost to the economy because of the increased demand for materials and related services.

The number of jobs in the manufacturing sector also continued to rise last month, increasing 2.5% from a year ago to 1.89 million, despite fears that a slowdown in the semiconductor industry might dampen growth. Friday’s report showed that demand for computers, electronic equipment and other export-oriented goods remains a solid contributor to the state’s growing jobs base.

“If you look at the fact that we added over 5,000 manufacturing jobs in April alone, while the same month the nation loses over 14,000 manufacturing jobs, that doesn’t hurt our feelings at all,” said Smith.

The service sector also chugged along, reaching 4.05 million jobs, a 4.5% year-to-year increase. The growth was spread among high-paid fields in technology businesses and lower-wage jobs in tourism.

Even the finance sector posted a slight gain, 0.5%, in employment to 735,000 jobs, despite the consolidation of banks and other financial institutions. Economists said that could be due to more jobs being created at stock brokerages and in the real estate industry.

“The whole picture of the California economy is that it is fairly well in balance,” said Cochrane, “You’ve got every single major category expanding.”

Adibi said that for the past few years Northern California’s strong growth has been carrying the state--and offsetting the spotty economic performance of the south. But that might be turning around, he said.

“I believe that Southern California is regaining momentum,” he said, though he added that “it’s a catch-up game.”

The biggest drag on the state economy has been Los Angeles County, which suffered deep wounds from aerospace, retail and financial services cutbacks.

While Los Angeles County’s jobless rate remained a relatively high 7.3% (seasonally adjusted) last month, continued growth in entertainment-related jobs helped push the rate down from March’s revised 7.4% and from 8.4% in April 1996.

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Fewer Jobless

April unemployment rates in Southern California range from 3.1% in Orange County to 7.0% in Los Angeles County:

California Unemployment:

April 1997: 6.5%

Southland Comparison

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County Rank Rate Orange 3 3.1% San Diego 8 4.3 Ventura 15 5.5 Santa Barbara 12 4.9 San Bernardino 18 6.1 Riverside 22 6.9 Los Angeles 23 7.0 California - 6.5

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Source: Employment Development Dept.; Researched by JANICE L. JONES / Los Angeles Times