v.19 n. 26 – Released June 22, 2015
This Week’s Headlines:
The Employment Development Department (EDD) released the state and local employment reports for the month of May. Total California nonfarm employment increased by 54,200 jobs over the month in seasonally adjusted (SA) terms.
The year-over-year change showed an increase of 465,700 jobs (SA). This equated to a growth rate of 3.0% and exceeded the May national increase of 2.2%. California’s private sector added 434,400 jobs (an increase of 3.3%) over the year, while employment in the public sector rose by 1.3% (31,300 jobs).
Ten of the 11 super-sectors added jobs over the year to May: construction; manufacturing; trade, transportation and utilities; information; financial activities; professional and business services; educational and health services; leisure and hospitality; other services; and government for a combined gain of 467,200 jobs. Professional and business services posted the largest gain on a numerical basis, adding 125,500 jobs (up 5.2%), while construction claimed the largest gain in percentage terms, increasing by 6.9% or 46,600 jobs.
The only sector to record a decline over the year was mining and logging, down 1,500 jobs, or 4.8%.
California’s unemployment rate edged up to 6.4% in May from 6.3% in April but was down from the year ago rate of 7.6%. At 6.4%, California’s unemployment rate is now just 0.9 percentage points above the national rate and below the long run average (since 2000) for the state of 7.6%. Moreover, there is good news hidden in the increase since it was caused by the largest uptick in the state’s labor force in 25 years. Last month, 71,800 workers joined the labor force, an increase of 0.4%. Because so many more people were feeling optimistic about finding a job, the increase in the labor force outpaced the number of new jobs added.
(Note: With the exception of the Los Angeles unemployment rate, county level numbers are not seasonally adjusted, which means there can be large month-to-month fluctuations in job counts. A truer picture of how local labor markets are faring is revealed by focusing on the year-over-year numbers. Annual trends “correct” for the seasonal factors that influence certain industry sectors over the course of the year.)
- In Los Angeles County, the seasonally adjusted unemployment rate was 7.6%, unchanged from April but below the year ago rate of 8.3%. Total nonfarm employment rose by 3,400 jobs over the month and by 100,500 jobs over the year, an increase of 2.4%.
Educational and health services posted the largest year-over-year gain in employment in May with an increase of 30,100 jobs, over two-thirds of which were in health care and social assistance. Also recording significant job gains were trade, transportation and utilities (20,800 jobs); leisure and hospitality (15,900 jobs) and government (12,200), most of which occurred in local government.
Of note in the May report was a large decline of 11,900 jobs over the month in motion picture and sound recording (a subsector of the information super sector). Employment in this industry follows a seasonal pattern with a sharp drop in January followed by a rebound over the next two months to a peak in March, then leveling off or pulling back over the following months and surging to another peak late in the year. Over the year, employment in motion picture and sound recording was up by 1,800 jobs (1.6%). Currently, motion picture and sound recording jobs in Los Angeles County account for 30% of the nation’s jobs in this industry. Two of the major industry sectors reported year-over-year declines in May: mining and logging (-200 jobs) and manufacturing (-2,100 jobs).
- In May, the unemployment rate in Orange County was 4.2%, up slightly from 4.1% in April but below the year-ago figure of 5.2%. Nonfarm payroll jobs increased by by 13,000 over the month and were up by 50,700 over the year (an increase of 3.4%).
- In the Riverside-San Bernardino area, the unemployment rate in May was 6.4% compared with 6.2% in April and the year ago rate of 7.8%. The region gained 3,400 nonfarm payroll jobs over the month and 51,800 over the year. This represented an increase of 4.0%.
- In Ventura County, the unemployment rate was 5.2%, down from the year ago estimate of 6.1%. Total nonfarm employment increased by 1,200 jobs compared with April and by 4,200 (up 1.4%) over the year ending in May.
Although California’s unemployment edged up in May, it was for the right reason: an increase in the labor force, which expanded by the largest margin since February 1990. Once again, California’s labor marketed added jobs at a faster annual pace than the nation with job gains occurring across a wide swath of the state’s industries. (Kimberly Ritter-Martinez)
Sources: California EDD
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