State jobless rate edges up amid 52,000 lost jobs

SACRAMENTO » California’s unemployment rate edged up nearly 1 percentage point last month as the state shed more than 52,000 jobs led by the pandemic-hobbled restaurant and lodging industries, the state’s beleaguered Employment Development Department reported Friday.

The jobless rate stands at 9% for December, the state’s fi rst monthly rate increase since April.

The leisure and hospitality sector took the biggest hit — down 117,000 jobs — with more than 80% of those in accommodations and food services.

“This sector more than any other was impacted by the renewed lockdowns and virus spread,” said Michael Bernick, an attorney with the Duane Morris law firm and a former director of the California Employment Development Department.

Those were partly offset by 31,600 additional construction jobs and nearly 30,000 professional and business services jobs, including tax preparation. Overall, six of the 11 industry sectors saw increases last month.

California had gained 5,200 jobs in November before giving back 10 times that number last month.

It has recouped 44% of the 2.6 million nonfarm jobs lost at the start of the pandemic in March and April compared with 55.6% nationwide, as a continuing stay-at-home order imposed on most of the state during a massive holidaysfueled coronavirus surge “played havoc with California

employment,” said Sung Won Sohn, a professor of finance and economics at Loyola Marymount University.

Bernick said the gain in construction jobs was surprising because there hasn’t been much major commercial construction in urban areas and several major public works projects have been on hold.

Sohn said low interest rates, more people working from home and a desire for more space have boosted construction, while industries where employees can work remotely have prospered.

Neither man held out much hope for immediate relief from federal stimulus packages.

Bernick said new President Joe Biden’s proposed $1.9 trillion plan is modeled after the Obama administration’s Great Recession plan investing in public works projects that still took months or years to add jobs.

“The best stimulus will come from the vaccines. As they are widely distributed, the economy will receive a shot in the arm,” Sohn quipped. That echoes an analysis Friday from the nonprofit Public Policy Institute of California that job recovery will be limited until the virus is contained.

It’s troubling that more than 500,000 people have dropped out of the labor force in the last year, despite a slight increase last month, he said. Some are taking care of children or the elderly during the pandemic or going back to school, but some may never rejoin the workforce.