VOICES- (Responding to CityWatch article ‘Bullish on the Golden Stage’) Here's how deceiving our unemployment figures can be:
1. The California unemployment rate in December dropped a dramatic .2% in one month -- from 7.2% to 7.0%. That is an IMPRESSIVE improvement. Except . . .
2. Number of net jobs added in California that month -- a state with over 38,800,000 people:
700 net new jobs.
No, I didn't leave out a zero or two -- SEVEN HUNDRED.
Yes, a statistically insignificant 700 net jobs added yet our state unemployment rate dropped a full two-tenths of a percent. How can this be?
You know the answer by now: Our lower unemployment rate for December is almost 100% due to people no longer looking for work, leaving the state, or retiring (a.k.a. the lower "labor force participation rate") -- even after counting the young adults entering the CA work force marketplace.
Here's another unnerving aspect to consider: Our CA jobs grew by 700. But the jobs gained too often were low-paying service jobs, while the jobs lost paid far more.
From the same report:
"Largest growth sector was 8,300 jobs in Leisure and Hospitality (average annual wage $23,950); largest decline sector was 12,300 jobs in construction (average annual wage $57,100)."
Meanwhile our CA state and local taxpayer obligations for unfunded government liabilities is growing at a LOT faster rate. All factors considered, this is not a sustainable economic system.
NOTE: My source is the California Center for Jobs and the Economy (an email I received 1/23/15). The site is run by the eternally optimistic California Business Roundtable. But this latest report is so new that it's not yet up on their website.
(Richard Rider is Chairman of San Diego Tax Fighters.)
-cw
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CityWatch
Vol 13 Issue 8
Pub: Jun 27, 2015
