California’s unemployment rate fell to a record-tying low of 4.7 percent in May, but experts still maintained that the state’s economy is slowing down.
Statistics released Friday by the state Employment Development Department said the jobless rate tied the record low from November-December 2000, long before the recession. EDD said its unemployment records date back to 1976.
The department said non-farm payroll employment statewide totaled 16.7 million in May, which included an April-to-May gain of 17,600 jobs. The year-over-year jobs gain totaled 242,600, a 1.5 percent annual increase.
EDD said the state has added more than 2.5 million jobs since economic expansion began in February 2010.
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Eight of California’s 11 industry sectors added jobs in May. The government sector posted the largest increase with a gain of 12,300, followed by the information sector with a gain of 9,600. Overall monthly job additions totaled 29,400.
Of the three industry sectors that saw a combined loss of 11,800 jobs last month, the leisure and hospitality sector had the biggest decline, down 9,700 jobs from April.
While experts praised the record-tying milestone, some cautioned that a closer look at the numbers presents a less rosy picture.
“California’s economy has resumed its upward trajectory in May after a temporary setback in April. However, the overall trend is clear: The Golden State is gradually losing its wind in the sail as the tightening labor market and rising wages represent headwind for the economy,” said Sung Won Sohn, a professor of economics at California State University, Channel Islands.
Sohn said jobs gains have “trended downward as the state nears full employment. This is especially evident in technology and construction. (Information technology) firms in Silicon Valley are acquiring other companies to get employees. Carpenters and masons are hard to find in the construction industry. The labor shortages have hit the job engines of the state – the Bay Area and Southern California.”
Sohn also pointed out that the statewide civilian labor force of 19.15 million in May represented a slight dip from March and April levels.
Michael Bernick, a labor lawyer in San Francisco and a former EDD director, was encouraged by the state’s monthly job gains – especially compared with a net monthly loss of 16,300 jobs reported by EDD the previous month – but warned that May’s job gains “do not indicate that our employment expansion, now in its 86th month, will continue. But it does suggest that last month’s losses may not indicate a trend of employment contraction.”
Sacramento County’s preliminary, non-seasonally-adjusted unemployment rate was 4.2 percent in May, with 29,300 unemployed, according to EDD. The county’s jobless rate was 4.6 percent in April.