October ’11 Jobs Report
By Stephen Levy, Director and Senior Economist, Center for Continuing Study of the California Economy (CCSCE) in Palo Alto.
California has now posted back to back strong job growth months. The state economy added 25,700 jobs in October following an upwardly revised gain of 39,200 jobs in September.
These gains made a small dent in the state’s unemployment rate with a decrease to 11.7% in October from 11.9% two months earlier.
For the past 12 months the California economy has added 239,000 jobs for a gain of 1.7% compared to the national job growth rate of 1.2% for the comparable period.
Both the state and national economy remain far below peak employment levels, in part constrained by the lack of progress in getting homebuilding going and the continuing drag of government job losses.
The industry pattern of recent job gains in California is positive for future with strong year over year gains in professional, technical, scientific and information services and a rebound in manufacturing activity and two years of continuing export gains. Companies that help consumers and businesses use the Internet and mobile phone technology more efficiently are steadily adding employees and, in recent weeks IPO activity for these companies has picked up with more companies coming to the market and stocks moving upward from the initial offering price.
Job growth within the state is led by the urban coastal regions that are benefiting from the growth in technology, trade and tourism. The San Jose metro area (Silicon Valley) posted year over year job growth of 27,300 (3.2%) followed by San Diego ( 24,000 jobs-a 2.0% gain), the San Francisco metro area (16,700 jobs—a 1.8% gain) and Orange County (20,400 jobs—a 1.5% gain).
Job growth has returned to the Inland Empire which added 15,200 jobs (1.4%) while Los Angeles County added 19,000 but only a 0.5% year over year gain.
While California again leads the nation in job growth with gains in sectors that are critical for future growth, uncertainty abounds at both the state and federal level as well as with events in Europe.
However, for the moment the state economy is moving toward slowly recovering the jobs lost in the recession and ever so slowly reducing the number of unemployed residents, which still totals over 2 million.