California Jobless Rate Hits 30-Year Low of 4.6%

California employers bucked the national hiring slowdown in February and added 40,200 workers, reducing the state’s jobless rate to a 30-year low of 4.6%.

The employment report released by state officials Friday reflects how California’s economic recovery continues to catch up with the record national business expansion.

Many analysts expect the torrid national economy to cool somewhat in coming months but, for the state, “there’s no sign of a slowdown,” said Tom Lieser, executive director of the UCLA Anderson Business Forecast.

Orange County’s jobless rate dropped to 2.3% in February, near its all-time low of 2.2% recorded in December. Unemployment in January was revised to 2.6%.

Orange County’s latest jobless figure was the lowest in Southern California, and it marked the area’s continued economic expansion. Over the past year, construction, business services and state government have led the county’s job growth. Strong gains also have come in construction-related industries, such as stone and glass manufacturing, real estate services and home-improvement retailers.

“Right now, we’re expanding at such a high rate as a company that we need as many people as we can get,” said Jon Rose, assistant manager of Home Depot’s Fullerton store, which added more than a dozen people last month.

Statewide, the seasonally adjusted jobless rate edged down last month from a revised 4.8% in January. The U.S. unemployment level, reported last week, inched up in February to 4.1%, from 4% in January.

Perhaps most impressive about California’s showing, analysts said, was that the state has gained more than 40,000 jobs a month for the last three months, with the average amounting to 43,600. “Those are very vigorous numbers,” said Ted Gibson, economist for the state Department of Finance.

Gibson noted that while California accounts for 11% of the nation’s nonfarm jobs, it has generated 18% of the nationwide job growth over the past three months.

Los Angeles County’s job market is improving too, but it continues to lag other urban areas in the state. The county’s jobless rate was 5.5% in February, down from a revised 5.6% in January and 6.1% in February 1999.

The gap between the state and U.S. jobless rates is now the narrowest since October 1990, when unemployment was 6.4% in California and 5.9% nationally.

California was hit later and harder than the rest of the nation by the recession of the early 1990s. The state’s aerospace and defense industries, particularly in the Los Angeles area, were devastated by military spending cutbacks.

The state’s employment total didn’t begin to grow again until June 1993, a full 15 months after employment nationally started to turn up.

But now, economists said, California actually may be benefiting from the late start of its recovery. While business expansion elsewhere is constrained by tight labor markets, California has more available workers looking for jobs.

What’s more, California stands to benefit disproportionately from the economic recovery in much of Asia because the state’s businesses are so closely tied to that part of the world.

In addition, rising interest rates engineered by Federal Reserve Chairman Alan Greenspan are expected to curb the national economy, but might put less of a damper on California. One key reason: California is heavily dependent on technology companies that, so far at least, have shrugged off the impact of higher interest rates.

Likewise, while higher interest rates are expected to slow home-building across the country, California’s home-building industry has remained relatively slow and thus doesn’t have as far to fall.

Gibson also pointed out that California, which is third lowest among the 50 states in per capita energy consumption, figures to be hurt less by today’s soaring oil prices.

The improvement in the California economy means job hunters are having an easier time finding work. One statistic released Friday showed that the share of unemployed people who have gone without work for 27 or more weeks fell to 13.2% last month, down from 23.8% a year earlier.

For executive headhunters such as Jay Berger of Pasadena, the tight labor market is complicating the task of finding talent for his client firms. In some cases, Berger said, “there’s a bidding war going on for really good people.”

The job gains in California last month were broad-based, coming in seven of the state’s nine major industry categories. The largest increases occurred in retailing, up 20,800; construction, up 6,900; and services, up 5,900. Another big gainer was government, which rose by 4,500, partly because of new jobs in the public school systems.

Lisa A. Grobar, an economics professor and director of the Cal State Long Beach Economic Forecast Project, explained that business expansion is translating into higher tax revenues for state and local governments, “so they’re able to do some hiring.”

Small job losses were reported in two categories: manufacturing, which was down by 900, and mining, which was off by 600.

California’s job gains provided a remarkable 93% of total U.S. employment growth reported for February, but that was an aberration. Analysts said the U.S. figures were hurt by poor weather and, possibly, statistical flaws.

At 4.6%, the California jobless rate stands at its lowest level since December 1969, when it was 4.4%. A year ago, joblessness in the state was 5.5%.

San Diego County and all five of the Los Angeles-area counties posted lower jobless rates in February. Unlike the statewide statistics and the numbers for Los Angeles County, the figures for Orange and other counties are not adjusted to filter out the impact of normal seasonal swings in employment.

Among the other Southern California counties, the unemployment rates were as follows:

* San Diego, 2.6% last month, down from 3% in January and 3.4% in February 1999.

* Orange County, 2.3% last month, down from 2.6% in January and 2.8% in February 1999.

* Ventura County, 3.9%, down from 4.7% in January and 5% in February 1999.

* Riverside County, 4.8%, down from 5.1% in January and 5.8% in February 1999.

* San Bernardino County, 4.2%, down from 4.6% in January and 5.1% in February 1999.

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O.C. Unemployment

The county’s seasonally unadjusted jobless rate dipped to 2.3% in February, the lowest for that month in at least two decades.

July 1999: 3.1%

Feb. 2000: 2.3%

Source: Employment Development Department

Labor Market Tightens

California’s jobless rate declined to a 30-year low as the state added more than 40,000 jobs in February. The job market continued to be even tighter in the United States as a whole.

February (estimated): 4.6% in California