Northeast Valley Getting Hit Hard as Jobless Rate Climbs

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Northeast Valley Getting Hit Hard as Jobless Rate Climbs

By JACQUELINE FOX

San Fernando Valley Business Journal





The Northeast San Fernando Valley has one of the highest concentrations of unskilled, low-wage earners in Los Angeles County, many of whom have been affected by the decline in manufacturing jobs over the last few years, as well as more recent cuts by hotels, restaurants and film companies.

Just ask La Shawn Daniels.

Daniels lost his job as a warehouse worker at Western Studio in North Hollywood in November. He had just been given permanent employment status after a two-year tryout and had worked his way up to $10 an hour before the company cut five workers just after Thanksgiving.

“You know what they say: last on, first off,” said Daniels.

The 29-year-old Pacoima man recently spent an afternoon at the state Employment Development Department’s Northeast San Fernando Valley Center in Pacoima scanning the CalJOBS Web site that links job seekers with employers’ job listings and other online services.

While L.A. County’s unemployment rate for December was 5.7 percent surprisingly low according to economists Pacoima’s rate approaches 20 percent. With a tight job market already in place and unemployment benefit increases going into effect, it’s likely that jobless claims will rise in the coming months.

Not enough jobs

“We know there’s a lot of job churning out there,” said Daniel Blake, who heads up the San Fernando Valley Economic Research Center at Cal State Northridge, “but the problem is there aren’t enough jobs for the number of people who are out there looking for them.”

If history repeats itself, Blake said, the recovery period from the slowdown is likely to extend well beyond analysts’ predictions for a spring turnaround.

“A lot of people are cautioning that the job build-up associated with the recovery may be slow,” said Blake. “In 1991 we experienced that here in the Valley. What we saw was that the jobless rate continued to rise until 1993, but the recession was officially over in 1991.”

There is a continuing debate on the impact of Sept. 11 on local employment. In November, there were 22,126 new unemployment claims filed, a 4.6 percent increase over the previous month and 64 percent over the like period a year ago.

But Lily Galoussian, the Pacoima center’s office manager, said that many of those visiting her office are drawn not so much by recent layoffs, but increases in weekly benefits.

“We expect to see the numbers go higher for January and February as more applicants come in to take advantage of the increases, but we don’t really think there was that great of an impact on this area from Sept. 11,” said Galoussian. “We did have some of the slowdown going on before (the attacks), but we also had 7,000 applicants here in the summer for a job fair for the new Lowe’s Home Improvement Center in Burbank.”

Daniels said the increase in unemployment benefits were a big reason why he waited until after the first of the year to file. But the month of unemployment without any benefits ate up much of his savings. And despite the benefits increase, a monthly rent of $560, cell phone, grocery and clothing expenses, and the cost of gas it takes to get to interviews does not leave much margin for error. He said he can’t afford to be out of work much longer.

“I can still pay my bills, but it won’t last forever,” he said.

His goal is to find another warehouse job, but most of the offers he gets are in the $8-an-hour range. “I’ll take whatever I can get, but it’s tough to think about a pay cut,” he said.

Retention is key

Blake said unemployment claims typically peak in July and bottom out around December. But the tech wreck of 2000 and the subsequent attacks forced seasonal unemployment patterns in 2001 into new directions.

Monthly unemployment claims for the Valley hovered above the 20,000 mark from June to November, representing the highest consecutive number of jobless claims in seven years.

Roughly 75 percent of the visitors to the Pacoima center already are receiving welfare payments. Vilma Bernal, who heads up the Mission College Welfare to Work Program, said 70 percent of the 110 participants in the program have been placed in jobs over the last year. The challenge, said Bernal, won’t be getting participants weaned off welfare, but rather helping them adjust to the rules of the workplace.

“One of the toughest parts of this program is not so much placement, but retention,” said Bernal. “These people were not used to going to work. So what is normal for us, like calling in when you’re sick or giving your boss notice about a doctor’s appointment, just wasn’t something they would do as a natural reflex. So they were having a hard time staying put.”

The number of welfare-to-work participants is likely to increase by year’s end, as many recipients face reductions in payments when the first five-year limit under welfare reform programs passed by the Clinton Administration takes effect in January 2003.

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