Hopes of a turnaround in the job
market dimmed in May as Orange County lost jobs on an
annual basis for the second month in a row.
The May unemployment report,
released Friday by the state Employment Development
Department, showed the county had 6,200 fewer jobs
last month than in May 2002, a 0.4 percent drop. In
April, payroll employment dropped 0.1 percent.
Chapman University economist Esmael
Adibi said it's a reversal of the trend at the
beginning of the year, which showed local job growth
beginning to pick up.
"We're just treading water," he
He attributed the turnaround to
discouraged workers dropping out.
Orange County's labor force – those
people working or actively seeking work – dropped 0.3
percent in May and only grew 0.8 percent annually. The
labor force typically grows 1.5 percent to 1.8 percent
annually, Adibi said.
As a result, he said the May drop in
the unemployment rate to 3.6 percent from 3.8 percent
in April is misleading.
"If the labor force is dropping
faster than employment, sure your unemployment goes
down," he said. "It's not because the economy is doing
a good job, people are just giving up." Things could
get worse as the full impact of state budget cuts hit
locally. Huntington Beach officials say they may have
to cut about a tenth of the city's 1,000 budgeted
positions. On Thursday, notices were sent to 50
employees of a possible layoff. Officials hope the
remaining cuts can come from vacancies. Ross de Vol, a
Milken Institute economist, said there was some cause
He called the tourism- and-leisure
sector, up about 2,000 jobs in May, "a solid anchor"
that has managed to hold up despite the Iraq war.
Perhaps more important, de Vol noted
that the drop in the county's manufacturing sector,
which is down 20 percent, or 38,200 jobs from the peak
in late 2000, appears to have leveled off.
"That was really hurting your
economy last year," he said.
Employment in electronic components
and communications equipment is still down, but de Vol
cited recent economic reports showing some growth in
orders. If sustained, he thinks that may translate
into more jobs.
Ellia Kassoff, a recruiter
specializing in technology jobs for Strategic
Software Resources Inc. in Newport Beach, said
he's also beginning to see some hiring in technology,
mostly in sales.
"We're not seeing clients say, 'I
have 10 openings and need help,' it's more like one
here and two there," he said. "But this time last
year, every sector was telling us, 'It's horrendous.'"
Register staff writer Sam Miller
contributed to this report.