It’s a milestone of sorts, reflecting California’s long but increasingly successful climb out of the recession: Unemployment has fallen to levels not seen since the stock market crashed in 2008.
California’s unemployment rate dropped three-tenths of a point in April, to 7.8 percent, state officials announced Friday. It marked the first time since September 2008, when Lehman Brothers’ bankruptcy sent the the stock market and economy reeling, that the rate has been below 8 percent.
In Sacramento, unemployment fell a full point last month, to 7.1 percent. That’s Sacramento’s lowest unemployment rate since June 2008, when it was 6.8 percent.
“We’re still not back to normal, but we are getting better,” said Irena Asmundson, chief economist at the state Department of Finance.
California’s job-creation record is the second-highest in the nation, behind Texas. In Sacramento, which lagged the recovery for so long, payrolls have grown by 2.5 percent in the past year. That’s one of the strongest rates of expansion the region has witnessed in years, and is slightly higher than the statewide average.
Of the roughly 1.4 million jobs that disappeared statewide during the recession, Asmundson said California has now recovered all but 25,000. The statewide unemployment rate is still a good deal higher than it was before the recession, but that’s because the population and labor force have grown, leaving more Californians out of work.
California employers added 56,100 jobs during April, according to the Employment Development Department. Every major sector of the economy saw job growth except for manufacturing and information. In Sacramento, 7,500 jobs were added, and every economic sector recorded job gains or was even with the month before.
Unemployment typically falls in April, as industries such as construction come out of their winter slumber. But the April numbers this year were stronger than usual. In Sacramento, the 1 percentage point drop compared with a historical average of 0.6 percent, said EDD labor market consultant George Marley.
The comeback remains far from complete, however. The construction industry, historically a pillar in the Sacramento economy, remains notably weaker than in years past. Despite encouraging signs in the real estate market, only 254 new homes have been sold in the four-county region this year. That’s less than half the average since 1990, according to market researcher DataQuick.
Homebuyers’ caution is reflected in the level of hiring by contractors. Although nearly 10,000 construction jobs have been created in greater Sacramento since 2011, the industry is still 22,000 jobs short of full recovery.
“We’ve recovered 9,600 jobs,” Marley said. “It still has a ways to go.”
Unemployment in Sacramento, like other cities in the Central Valley, remains higher than in most coastal communities, which have benefited from a booming technology sector. San Francisco’s unemployment rate is down to 4.4 percent, Marin’s is 3.9 percent and Orange County’s is 5 percent.
There are also signs the drought is starting to depress job markets in rural California. Although unemployment rates fell throughout the Central Valley in April, the surge in agricultural jobs wasn’t as strong as it usually is this time of year. Farm employment is lower than it was a year ago in San Joaquin, Tulare, Madera and several other counties, although it was higher in Merced County.
Although job growth has been generally solid throughout much of California, participation in the labor force has slipped somewhat, and continued to drop in April. That helps accelerate the decline in unemployment rates, but also suggests that many Californians are still pessimistic about finding work.
“The labor force isn’t growing, and hasn’t responded yet to the expansion (in payrolls),” said economist Jeff Michael of the University of the Pacific.
The skepticism may be well founded. In spite of the improved economy, San Francisco lawyer and labor market expert Michael Bernick said finding a job remains difficult for many Californians.
“If you talk to people in the job-training world ... most job seekers continue to find it a very competitive market,” said Bernick, a former EDD director who is an adjunct fellow at the Milken Institute.
Call The Bee’s Dale Kasler, (916) 321-1066. Follow him on Twitter @dakasler.