State’s Job Growth for ’96 Rosier Than Thought

Providing more luster to California’s bright economic picture, revised figures released Friday show employers in the state added a whopping 379,300 jobs last year, 57,000 more than previously estimated.

Although Los Angeles County continued to lag, the state’s employment growth last year was the most since 1988. The report also underscored the significance of small high-tech firms that have sprouted since the recession, mainly in Northern California but also in Orange County and the San Gabriel Valley.

Indeed, most of the 57,000 additional jobs picked up in the once-a-year revision came in high-tech manufacturing and services, including start-ups and other nimble businesses that are difficult to track on a month-to-month basis.

“They don’t have time to fill out [monthly] forms; they’re on Internet time,” quipped Ted Gibson, economist for the state Department of Finance. Gibson said the revised job figures were higher than he had expected.

“It really is further confirmation that the state’s economy is in a good, solid recovery,” he said.

Friday’s report by the state Employment Development Department also said the healthy pace of job formation carried into January, despite wet weather that severely cut farm payrolls. California’s jobless rate in January held steady at 6.8%.

Although California’s rate is higher than the U.S. unemployment figure of 5.4%, analysts noted that the state is now clearly the nation’s front-runner in terms of job growth.

“The [California] economy is doing fabulous and is leading the nation in a definitive way,” said Mark Zandi, economist at Regional Financial Associates, an economic consulting house in West Chester, Pa.

But Los Angeles County had much less to cheer about.

Although the county’s jobless rate dipped in January to 7.4%, from 7.8% the previous month, data revisions showed that employment expansion since early 1995 has been much smaller than previously thought.

In fact, analysts reported Friday that they had over-counted a startling 46,600 jobs for Los Angeles County, mostly in wholesale and retail trade and the banking industry.

Employment in the county expanded by 1.8% last year, not 2.5%, as previously estimated. Statewide, payrolls grew by a robust 2.9% last year, according to the revised figures.

“I just think our sample wasn’t good enough,” said state analyst Mike Caplis, explaining the big over-count of Los Angeles County jobs.

The monthly jobs report data are drawn from a relatively small sample of employers, but once a year analysts revise the monthly job totals by drawing information from payroll tax filings from virtually all employers.

The data revisions, however, turned up a few positive trends in Los Angeles County. The motion pictures industry, for example, added at least 6,700 more jobs than previously thought. And, despite concerns that apparel businesses may be flocking to Mexico, the revisions show apparel employment grew at a sizzling 10% rate last year.

“Everybody has been shaking in their boots over that,” economist Jack Kyser at the Economic Development Corp. said of the apparel industry. “But you’d have to say, ‘So far, so good.’ ”

Still, Kyser said, Los Angeles County remains about 300,000 jobs shy of the pre-recession peak. It is the only major area in the state that has not made up all of the jobs lost during the recession.

Although the revisions cost jobs in Los Angeles County, most other counties in the state saw the reverse.

Employment in Orange County, one of the stars of the recovery, was lifted by an additional 7,000 jobs last year. Orange County’s jobless rate rose to 3.7% in January from an unusually low 3.1% in December, largely because of cutbacks by retailers after the holiday season. Unlike the state’s, the county’s jobless figures are seasonally unadjusted.

The Inland Empire also gained more jobs last year than previously estimated. The jobless rate for Riverside and San Bernardino counties shot up to 7.4%, from 6.3% in December. Even so, job formation in those two counties is now running ahead of the statewide pace.

Statewide, Friday’s report showed that all sectors, with the exception of mining, enjoyed job growth in January compared with January 1996. Significantly, construction payrolls grew by 6.2% from a year earlier. Manufacturing employment--fueled by strong exports of computers and electronic components--was up 2.4%, or 45,000 jobs, from a year earlier.

“We like the mix we’re seeing,” said the Finance Department’s Gibson.

* SLOW GROWTH

Revised numbers estimate growth was slower than expected in the last three months of last year. D2

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

Holding Steady

California’s unemployment rate held steady in January.

Jan. 1997: 6.8%

Source: Labor Department