State is still on a hir­ing streak

Cal­i­for­nia em­ploy­ers add 54,000 jobs in May in one of the largest monthly jumps in the last year.

Los Angeles Times - - BUSINESS - By Chris Kirkham

Cal­i­for­nia em­ploy­ers con­tin­ued a nearly four-year hir­ing streak by adding 54,200 jobs in May, one of the largest monthly em­ploy­ment jumps in the last year.

The state’s un­em­ploy­ment rate edged up to 6.4%, slightly higher than 6.3% in April, but sig­nif­i­cantly down from a rate of 7.6% a year ear­lier, ac­cord­ing to data re­leased Fri­day. Econ­o­mists saw the small uptick in un­em­ploy­ment as en­cour­ag­ing, how­ever, be­cause more peo­ple en­tered the state’s la­bor force last month than at any time in the last quar­ter of a cen­tury — a sign of re­newed con­fi­dence in the job mar­ket.

The con­struc­tion in­dus­try con­tin­ued to be state’s fastest-grow­ing job cre­ator, ex­pand­ing at more than twice the rate of Cal­i­for­nia’s over­all job growth. Although there are still far fewer Cal­i­for­ni­ans work­ing in con­struc­tion than at the peak of the hous­ing bub­ble in 2006, the in­dus­try is re­bound­ing swiftly.

Just as Cal­i­for­nia’s real es­tate mar­ket was one of the hard­est hit by the eco­nomic down­turn, ex­perts said hous­ing and con­struc­tion jobs are some of the quick­est to bounce back in an ex­pan­sion. Be­cause Cal­i­for­nia’s

prop­erty val­ues tend to be higher than the rest of the U.S., the state is ex­posed to larger swings in parts of the econ­omy tied to real es­tate.

“We are go­ing up faster be­cause we went down faster,” said Sung Won Sohn, a pro­fes­sor of eco­nom­ics at Cal State Univer­sity Chan­nel Is­lands.

Mike Hol­wick, a prin­ci­pal at Hol­wick Con­struc­tors in Wood­land Hills, said the com­pany pulled in more rev­enue last year than at any time since he took over the busi­ness in 2002. His firm spe­cial­izes in in­te­rior of­fice con­struc­tion for the en­ter­tain­ment and le­gal in­dus­tries. In the last two years, he said, his clients have splurged on em­ployee lounges, TVs through­out the of­fice and much higher-end fin­ishes.

The com­pany typ­i­cally sub­con­tracts work to other com­pa­nies, but con­struc­tion work­ers are in such high de­mand that Hol­wick has had dif­fi­culty re­ly­ing on the sub­con­trac­tors he used in the past.

“They’re just stretched thin,” Hol­wick said. “In the last two years, I’ve had more sub­con­trac­tors de­cline to bid than I did in the pre­vi­ous 10. They’re too busy.”

Although land is scarce for sin­gle-fam­ily home con­struc­tion in Los An­ge­les County, econ­o­mists said the com­mer­cial mar­ket and in­fra­struc­ture projects at Los An­ge­les In­ter­na­tional Air­port and the ports of Los An­ge­les and Long Beach should bring con­tin­ued de­mand for con­struc­tion work.

“There’s a whole lot of work in the pipeline,” said Mark Vit­ner, a se­nior economist at Wells Fargo who stud­ies re­gional eco­nomic trends. “Many of the com­mer­cial projects are mul­ti­year projects, so I think con­struc­tion will re­main strong for quite some time.”

Other rapidly grow­ing in­dus­tries in Cal­i­for­nia over the last year in­cluded pro­fes­sional and tech­ni­cal ser­vices — high-pay­ing ar­chi­tects, engi­neers and con­sul­tants — and the lower-pay­ing leisure and hos­pi­tal­ity sec­tor.

Af­ter nearly five years of con­sis­tent declines in Cal­i­for­nia’s un­em­ploy­ment rate, the one blip in May’s eco­nomic data was a small in­crease, from 6.3% in April to 6.4% last month. The na­tional un­em­ploy­ment rate is 5.5%.

The rate is mea­sured by di­vid­ing the num­ber of un­em­ployed by the state’s to­tal work­force — those who have jobs or are ac­tively seek­ing them.

At times dur­ing the Great Re­ces­sion, un­em­ploy­ment rates de­clined be­cause some peo­ple gave up look­ing for work, de­creas­ing the num­ber in the work­force. The op­po­site was true in May, when the la­bor force ex­panded by 71,800 peo­ple.

That’s the largest monthly in­crease since 1990, one that econ­o­mists say bodes well for fu­ture job growth.

“When the econ­omy is lousy, peo­ple sim­ply drop out of the la­bor force and think it’s a waste of time,” said Sohn, the economist. “Now peo­ple are com­ing out of the wood­work, be­liev­ing there are jobs to be had.”

L.A. County’s un­em­ploy­ment rate re­mains higher than the state av­er­age, at 7.6%, down from 8.3% a year ago. Un­em­ploy­ment in the In­land Em­pire, not sea­son­ally ad­justed, was 6.4%, and Or­ange County logged a 4.2% un­em­ploy­ment rate. chris.kirkham@latimes.com

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.