L.A. County Job Growth Slows

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L.A. County’s job-creating machine slowed in June as the troubles in the residential real estate market are finally having an impact on the overall economy.


The unemployment rate in L.A. County rose to 4.9 percent in June from 4.7 percent in May and 4.6 percent in June 2006, according to figures released Friday from the state Employment Development Department. With school out, more people were looking for work, while the number of people in L.A. County with jobs was essentially flat.


Meanwhile, nonfarm job payrolls in L.A. County grew by only 2,200 in June from May, an increase of just 0.1 percent. And year-over-year job growth, one of the key economic indicators for the region, is also slowing, with only 38,000 net jobs created in the past year, for a growth rate of 0.9 percent.


Statewide, the picture was even bleaker, virtually flat with only 400 net jobs added in June to a base of 15.2 million jobs. The state’s unemployment rate was unchanged at 5.2 percent, though up from 4.9 percent in June 2006.


“We’re losing some of our upward momentum as the declines in construction are finally starting to show up,” said Jack Kyser, chief economist with the Los Angeles County Economic Development Corp. “For the last year, people have been wondering when the slow down in the real estate market would show up in the employment numbers and now it has.”


Indeed, construction employment in L.A. County was flat in June at 155,900 jobs compared to May. But over the past year, more than 3,000 jobs have been shed in construction, with the greatest declines coming among the specialty trade contractors that do much of the residential building work.


The other drag on L.A.’s economy has been the continued slow but relatively steady erosion of manufacturing jobs. Between June 2006 and June 2007, 7,300 jobs have been lost in the sector, for a drop of 1.6 percent. The declines have been broad-based across most manufacturing industries.


Even the bright spots in L.A.’s economy were more modest in June. Professional and business services gained 2,000 jobs, or 0.3 percent, from May, though that sector still registered a robust year-over-year gain of 2 percent. And the leisure and hospitality sector added 2,800 jobs, or 0.7 percent, in June, almost entirely due to seasonal hiring.


The only real standouts in year-over-year job growth were the health and social assistance sector, which added 10,800 jobs for a growth rate of 2.8 percent, and K-12 education, which added 6,000 jobs for an astonishing growth rate of 22 percent.

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Howard Fine
Howard Fine is a 23-year veteran of the Los Angeles Business Journal. He covers stories pertaining to healthcare, biomedicine, energy, engineering, construction, and infrastructure. He has won several awards, including Best Body of Work for a single reporter from the Alliance of Area Business Publishers and Distinguished Journalist of the Year from the Society of Professional Journalists.

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