The good economic times keep rolling in California, where the jobless rate fell to a record low 4.1 percent in September and the state’s rural and agricultural areas are seeing historically low unemployment.
Numbers released Friday show more than eight straight years of employment increases, California’s second-longest expansion since World War II.
Jobless rates in the San Francisco Bay Area fell below 3 percent. But Central Valley, rural northern and inland southern counties that traditionally have at least 8 percent of their residents unemployed are down several percentage points.
California still trailed the comparable nationwide unemployment rate of 3.7 percent.
The thriving tech sector is helping drive the low rates in the Bay Area, said Michael Bernick, a former director of the state Employment Development Department and now a fellow at the Milken Institute. But most counties are seeing a broad employment expansion across most job sectors driven by a continued strong overall economy.
California’s employers had a net gain of 13,200 nonfarm payroll jobs during September, and a gain of 42,600 jobs in August. The unemployment rate is a record low since the state’s methodology changed in 1976. It was down from 4.2 percent for the previous five months and from 4.5 percent a year ago.
The largest job increases were in the professional and business services sector, followed by leisure and hospitality, government and the mining and logging sector. Educational and health services led job losses.
Imperial County on the U.S.-Mexico border was the outlier, with a jobless rate of 19.3 percent. That isn’t new and reflects the county’s agricultural economy and reliance on seasonal employment, Bernick said.
Sung Won Sohn, chief economist at SS Economics, a consulting firm, sees worrisome signs ahead despite the state adding more than 3 million jobs since the current economic expansion began in early 2010.
He pointed to declines in high-paying manufacturing and construction jobs, which he blamed on a labor shortage and the trade war with China and its higher tariffs.
“Rising mortgage rates and worsening affordability of homes have sapped the housing industry,” wrote Sohn. A continued trade war could harm California’s international trade in aircraft, dairy, fruit and electronic components, while “uncertainties will discourage employers from hiring workers and businesses from making long-term capital expenditures.”
Currently, California companies have trouble finding employees, though the shortage is drawing back workers who were sitting on the sidelines. But he said California’s high cost of living is driving both employers and employees out of state or to cheaper areas within California.
Bernick was more optimistic, noting that economists have feared a slowdown for several years, yet the economy keeps expanding. Even higher tariffs this year so far have seemed to have no significant impact.
“At some point this will end,” he said, but “we could well continue for some time.”