State Adds 36,300 Jobs in Broad-Based Boom

California’s economic engine continued to pick up steam in February, as employers added another 36,300 new jobs, pushing the unemployment rate to its lowest level in nearly eight years, the state reported Friday.

Job growth was broad-based, with all major industry sectors, including manufacturing, services and retailing, boosting payrolls. The seasonally adjusted unemployment rate fell to 5.8% from January’s revised 6.0%, reaching the lowest level since August 1990, the state Employment Development Department said.

In February 1997, the state unemployment rate stood at 6.6%.

Orange County remained one of the state’s hottest job markets. The unemployment rate, which is not adjusted for seasonal factors, sank to 3% from 3.1% in January, as employers added another 7,800 jobs.

Economists said they were a bit startled by the state economy’s resilience in the face of El Nino’s storms and the Asian financial crisis.

Even the construction industry added workers last month as the pall of El Nino failed to dampen that industry’s comeback.

“California is right up on top,” said Steve Cochrane, an economist at Regional Financial Associates in West Chester, Pa. “Everything seems to be coming together for California right now.”

Although California’s unemployment rate remains higher than the 4.6% rate for the nation as a whole, it has been closing the gap at a surprisingly fast clip. In the last year, half a million new jobs have been added in the state, a robust 3.8% gain.

“This is a very positive piece of news,” said Tom Leiser, an economist at UCLA’s Business Forecasting Project. “We’re clearly on a stronger trend than the national labor market.”

In Orange County, total employment has increased by 56,700, or 4.7%, in the last year. But Esmael Adibi, director of Chapman University’s Anderson Center for Economic Research, cautioned that such a high rate of growth is unsustainable and it will likely be adjusted downward when the state revises the numbers early next year.

Still, the county’s surging employment market continues to lure back the longtime unemployed. The labor force--the number of people available to work in the county--grew by 2.8% in the last year to 1.4 million. But new workers are being quickly hired by employers and the unemployment rate continues to fall, an indication of just how powerful the county’s jobs machine is, Adibi said.

Employment growth in the county is spread across a broad range of industries. Construction employment is now up 11% over a year ago, to nearly 60,000, while manufacturing has grown by 5.5% to 228,600. The service sector also expanded to nearly 1 million jobs, a 4.2% gain from a year earlier.

“The economy still has quite a bit of momentum and strength,” Adibi said. “What I’m trying to pass along is it’s not going to be as strong as it is now.”

The good news last month extended into Los Angeles County, where the unemployment rate fell to a seasonally adjusted 5.8% from a revised 6.1% in January and 7.2% a year earlier. The last time the county’s unemployment rate was equal to or below that of the state was in 1995.

Total employment in Los Angeles County has expanded by more than 100,000 in the last year, with strong gains registered in construction (up 4,300), manufacturing (23,100), aerospace (1,900), apparel (7,900), transportation (6,100), retail (13,700) and services (42,800).

But economists also sounded a few cautionary notes about Los Angeles. Clouds continue to hang over the motion picture sector, a major employer whose explosive growth has helped fuel the county’s rebound in the last few years. Though the industry added workers from January to February, it remained 1,600 jobs, or 1.1%, under the year-ago level.

Last month, the state agency reported that California created more than 100,000 more jobs in 1997 than previously estimated. In releasing its annual revisions of jobs data based on a more comprehensive survey of employers, the EDD found that nonfarm employment in the state jumped by 3.6% last year.

The strong growth so far this year has defied predictions that the economy would begin to slow because of the turmoil in Asia.

Even when the effects of Asia’s woes do begin to surface, the damage is expected to be limited because of the continuing strength in the national economy, where most of California’s goods are sold, and because of a solid base of industries here.

Other counties also showed improvement last month. In Riverside County, the jobless rate fell to 6.6% from 7.0%, and San Bernardino County’s rate declined to 5.8% from 6.1% in January. Ventura County’s rate was down to 6.0% from 6.4%. Those figures are not seasonally adjusted.

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Unemployment Picture

Orange County monthly unemployment trend, not adjusted for seasonal factors Feb 1998: 3.0%

Source: State Employment Development Department