Calif. unemployment rate dips slightly in January


March 4, 2011 5:53:45 PM PST
California's unemployment rate has dipped slightly but still remains far higher than the national average.

If California is in a U-shaped recession, perhaps this is a sign things may be on an up-trend. For the last four months of last year, the state's unemployment rate would not budge from a recession high of 12.5 percent. New numbers out for January show that ticked down to 12.4 percent.

"Now what we really need to see is some job gains and we've had four straight months of job gains. That's an important trend. Now we need to see that solidifies and grows even stronger in the months ahead," Loree Levy from the Employment Development Department said.

Joseph Freeman has been looking for work for nearly a year now. The unemployed purchasing agent is taking classes to improve his skills. He's happy the jobless rate is lower, but discouraged at the same time.

"Any drop is good. That just means some people have hired a little. But I don't think it really affects people like me at the bottom looking up," he said.

EDD also reviewed last year's trends. While the state saw construction jobs evaporate during the recession, 2010 saw more job losses in government than construction. Roughly 51,000 jobs lost in government and about half of that in construction.

"Government has replaced construction as the big drain in the economy," Levy said. "It really is reflective of the very tough budgeting times we face and it's created a lot of very tough decisions on a localized level, as well as state government."

The public sector may continue to drag California recovery, as all levels of government still has to deal with shrinking tax revenue. A record 30,000 pink slips may to go out to public school teachers by March 15 because districts are uncertain of funding.

"It's going to be pretty devastating. So people need to think about that economic impact of the public sector workforce on California. It's pretty significant," public schools lobbyist Kevin Gordon said.

Gov. Jerry Brown hopes to add a proposal on the June ballot to extend higher taxes for five more years.

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