Unemployment Dives

The jobless rate in Los Angeles County plunged to just 6.0 percent in January, down from December’s 6.7 percent. The drop puts L.A.’s out-of-work population just higher than the statewide average, which is 5.9 percent.

The county ended the year with 3.96 million non-farm payroll jobs, 97,000 more than in December 1996.

According to the Employment Development Department, the county’s payroll growth was 2.5 percent last year, despite the fact that employment in the motion picture industry declined 0.5 percent (5,900 motion picture jobs were lost). However, the loss was offset by unexpected gains in manufacturing employment (see story, page 5).

Alameda Corridor in Trouble?

After studying the plan intended to link the region’s ports to Los Angeles rail yards, the U.S. General Accounting Office concluded last week that existing construction deadlines and financial projections may be overly optimistic.

The $2 billion project, which is expected to spur economic growth in the region, will be funded by the sale of bonds to the public, a $400 million federal loan, and money from the ports and the Metropolitan Transportation Authority. The MTA is supposed to contribute $348 million, but because it has its own financial problems, the GAO is concerned that funding could be delayed.

Any delays in funding could adversely affect the rate at which investment bonds are issued. Despite these cautions from the GAO, corridor officials are confident that the project will generate plenty of revenue with which to pay off debt.

Panasonic Coming to Town

New Jersey-based Panasonic Broadcast & Television Systems announced that it would relocate its leading unit to a 45,000-square-foot facility in North Hollywood. The unit, Panasonic Broadcast & Digital Systems Co., is being moved to accelerate product development in the digital era, company officials said. “The Los Angeles area provides the ideal location in which to headquarter our product development efforts,” unit President Steven Bonica said in a statement. Company officials said they did not know how many jobs would be located in the new center.

The facility will be located on Cahuenga Boulevard near Universal Studios.

Computer Sciences Takeover Bid Derailed

Computer Associates International announced last week that it wouldn’t extend its offer for El Segundo-based Computer Sciences Corp. past the original March 16 deadline, a day after Computer Associates filed a rosy profit forecast with the Securities and Exchange Commission that might have forced Computer Associates to sweeten its bid.

Computer Sciences said it expects to record earnings of $3.41 a share for the 1998 fiscal year ending April 3, and projects three-year compound annual growth rates of 21.1 percent for earnings well ahead of most analysts’ estimates. If the company can achieve such an ambitious growth, it would make Computer Associates’ $108-a-share bid seem inadequate, analysts said.

Computer Associates officials said they believe that a protracted takeover battle would only harm both of them. The March 16 deadline is keyed to a Nevada hearing, in which Computer Associates will try to convince a U.S. District Court judge to throw out Computer Sciences’ recent anti-takeover defenses.

Pasadena Retail Project Approved

The Pasadena City Council last week approved a controversial $32 million plan to renew South Lake Avenue with a movie theater, parking structure, grocery store and boutiques surrounding the Macy’s department store.

Nearly 500 people turned out at the Civic Auditorium for the council meeting. After several hours, the council voted 4-2 in favor of the proposal by Forest City Development.

The plan generated a great deal of controversy, with the South Lake business community in favor and local residents in opposition. Proponents argued that without the project, discount stores would continue to invade the once-elegant shopping area, while opponents said the project was too massive and would destroy South Lake’s character, creating traffic and parking problems.

Charter Boards to Cooperate

Despite their different origins, the two boards charged with rewriting Los Angeles’ charter are creating a conference committee in order to come to a consensus about proposed changes.

The elected commission will put its proposals directly to the voters, while the appointed commission, formed by the City Council, must have its proposals approved by the council before they can be passed on to voters. But the two commissions plan to work together throughout the process in order to ensure that their recommendations are not at odds with each other. Their goal is to present one charter reform proposal to voters.

Key reform issues include city government’s responsiveness, accountability, and efficiency. The conference committee will probably be composed of three permanent and two rotating members from each of the 18-member reform panels.

Contractors Face Fraud Charges

The Los Angeles County District Attorney’s Office launched what it calls a crackdown on insurance fraud in the construction industry last week by filing charges against four local contractors.

The companies allegedly misreported wages or types of workers in order to pay lower workers compensation premiums. District Attorney Gil Garcetti says this type of “premium fraud” results in the loss of approximately $96 million a year and 8,000 jobs to the Los Angeles economy.

The companies charged were Component Assembly Systems in Woodland Hills, Unispec Construction Inc. in El Segundo; Red Carpet Building Maintenance in Northridge; and Ande Contractors in Calabasas.

Compiled by Alexa Apallas, Elizabeth Hayes and Dan Turner