County’s Jobless Rate Falls Slightly

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Los Angeles County’s unemployment rate fell slightly in June to 11.3 percent from a record 11.6 percent in May, but the drop was attributed not to increased employment but because more residents grew discouraged and left the workforce, according to state figures released Friday.

Meanwhile, the overall jobs picture continued to worsen as the county lost a whopping 188,000 jobs in the last year, a 4.6 percent drop, according to the figures from the state Employment Development Department. The losses are spread throughout the economy, with manufacturing, retail trade, motion pictures and hospitality services continuing to get hammered.

“This is another discouraging jobs report,” said Jack Kyser, senior economist at the Los Angeles County Economic Development Corp. “I expect we’re going to see job losses like this continue through the summer and into the fall.”

The decline in the unemployment rate was largely due to a drop in Los Angeles County residents claiming unemployment benefits; many of those have simply given up looking for work, Kyser said. There was also a slight increase in the number of residents saying they had jobs. One possible explanation: Some residents may have found part-time work that doesn’t show up on payroll jobs records.

The unemployment rate is well above the June 2008 rate of 7.4 percent.

Statewide, the unemployment rate in June was 11.6 percent, showing that other parts of the state are getting hit harder than Los Angeles County. Within the county, the unemployment rates for the cities of Long Beach and Los Angeles remained unchanged in June from May’s 12.5 percent.

The unemployment rate is derived by surveying a sample of households in the county and can be a volatile gauge. Payroll data are from companies submitting information to the state Employment Development Department.

On the payroll jobs side, the figures in June were especially gloomy, as total nonfarm employment fell by 13,600 jobs to 3,919,100 from May. The main culprit: schools letting out for summer vacation.

On the more closely-watched year-over-year payroll jobs figures, the job losses have increased as the year has progressed. In January, the year-over-year drop was 113,000; in June, it grew to 188,000. The county has sustained huge losses in manufacturing (38,000), professional and business services (36,000), retail trade (21,100), construction (20,600) and motion picture and sound recording (17,700).

Kyser said he expects construction employment to bottom out and even start gaining towards the end of the year as federal stimulus dollars begin to arrive.