Los Angeles Business Journal

L.A.’s Unemployment Rate Dips Into Single Digits

By Howard Fine Originally published May 17, 2013 at 2:29 p.m., updated May 17, 2013 at 11:51 a.m.

Los Angeles County’s economic recovery notched a milestone in April when the unemployment rate fell to 9.9 percent, the first time it was below 10 percent since December 2008, according to state figures released Friday.

The news was tempered by a flat payroll jobs market as gains in construction and retail were offset by sharp drops in entertainment and local government payrolls.

April’s 9.9 percent unemployment rate was down from 10.2 percent in March and 11.2 percent a year ago, according to figures from the state Employment Development Department. The rate has declined slowly but steadily since peaking at 13.2 percent in July 2011.

But Los Angeles County’s rate was still significantly above the statewide average for April of 9 percent and way above the national average of 7.5 percent.

Locally, the unemployment rates for the county’s two largest cities – Los Angeles and Long Beach – remained in double digits, with Los Angeles at 10.3 percent and Long Beach at 10.2 percent. The cities with the lowest unemployment rates were clustered around the South Bay, with Manhattan Beach posting a rate of 3.2 percent.

While the unemployment rate fell in April, the payroll jobs market stalled, posting virtually no change at 3.9 million jobs. This comes after a robust gain of 23,000 payroll jobs in March.

“During the first quarter, our clients definitely felt they were understaffed and they stepped up their hiring,” said Brandi Britton, Los Angeles-area district manager for Robert Half International, a Menlo Park staffing firm. “But now that they have hired some people, they are a little more comfortable with their staffing levels and are willing to leave positions open longer to find the perfect candidate.”

Payroll jobs data are drawn from a survey of employer payrolls, while the unemployment rate is derived from a sampling of households. The different trajectories in April suggest that many Los Angeles County residents are finding jobs in the informal job market, either as independent contractors or in cash-only jobs off the books.

When adjusted for seasonal factors, the county actually gained 8,000 payroll jobs, according to figures from Beacon Economics, a Los Angeles economic consulting firm.

The construction sector was one of the strongest gainers, adding 2,300 payroll jobs, while retail jobs rose by 1,700.

Local government payrolls suffered the sharpest cuts, down 3,300 jobs, followed closely by the volatile entertainment industry, down 2,800 jobs.

The picture was much brighter for the closely watched year-over-year payroll jobs figures. Over the past 12 months, Los Angeles County gained 76,500 jobs, an increase of 2 percent.