L.A. County Unemployment Rises Despite Job Gains

L.A. County’s unemployment rate inched up to 4.9 percent in September from 4.8 percent in August even as employers in the region added 43,500 jobs to their payrolls, the state reported Friday. The unemployment rate rose because more L.A. County residents entered the labor force looking for work, causing the labor force to grow by 31,000 to 5.16 million, according to figures from the state Employment Development Department. About 25,000 more county residents reported they were working, bringing the total to 4.91 million. That meant the ranks of the unemployed swelled by 6,000 to 251,000; some of these may be people with more marginal job skills finally confident enough to seek employment. While the rate increased from August, it was still down from 5.2 percent in September 2016 and it was lower than last month’s statewide rate of 5.1 percent. But the countywide increase did enlarge the gap with the rest of the nation, where the average unemployment rate fell to 4.2 percent in September. With the unemployment rate below 5 percent – the level many economists consider full employment – wage pressures are definitely increasing, according to Brandi Britton, Los Angeles district president for Robert Half International, a Menlo Park staffing firm. “Companies are now being dragged into bidding wars for highly talented workers,” Britton said. “It’s challenging for employers because they have not budgeted for such large salary increases to fill vacant positions and other employees sense a chance to boost their own pay or seek work elsewhere.” Meanwhile, on the payroll jobs front, employers in Los Angeles County added 43,500 jobs to bring total nonfarm employment to 4.45 million, erasing summertime drops. The main reason for the increase was a seasonal jump in both public and private education employment as the academic year started up again in September, resulting in a net 36,000 jobs being added to payrolls. The state applies a seasonal adjustment to take this into account; once that adjustment was factored in, nonfarm payrolls increased by 17,000 between August and September. Besides education, other sector with significant net additions in payroll jobs last month included healthcare/social assistance (up 6,000 jobs) and professional/business services (up 3,400 jobs). “We’re seeing more demand for positions to be filled in the professional/business services sector,” Britton said. The construction sector registered the largest decrease in payroll jobs between August and September, with a drop of 3,600 jobs. Manufacturing continued its decades-long structural decline, shedding 2,200 jobs. In another sign of an economy near full employment, the rate of year-over-year growth in payroll jobs remained modest in September. The county added 51,000 jobs between September 2016 and September 2017, for a growth rate of 1.2 percent. That growth rate is down significantly from the levels of about 2 percent commonly seen in 2015 and 2016. Health care/social assistance was the sector gaining the most jobs over the past year (up 24,500), followed by construction (up 6,400 jobs) and professional/business services (up 6,100). Despite the seasonal jump in payroll jobs last month, local government educational services (primarily K-12) saw a huge drop of 10,000 jobs between September 2016 and September of this year.