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California creates new jobs as economy shows signs of slowing

California employers added 41,400 jobs in April, bringing the state’s unemployment rate down to its lowest level since the pandemic began after 14 straight months of growth.

The country’s most populous state has now recovered more than 91% of the 2.7 million jobs lost in March and April 2020, back at the start of the pandemic, when Gov. Gavin Newsom issued the first statewide stay-at-home order, which many forced factories to close.

California’s labor force — the number of people who are either employed or looking for work — added 111,800 people in April, an encouraging sign for employers who have been struggling to find workers to keep up with rising demand for goods and services.

“These are encouraging signs that the California economy is beginning to return to normal,” said Sung Won Sohn, an economics professor at Loyola Marymount University who closely monitors the California economy.

But there are worrying signs on the horizon. Job growth in California isn’t what it could have been, as evidenced by the nearly 1.28 million job openings statewide at the end of March. Inflation remains high, with average gas prices in the state hitting a record high of $6.06 a gallon on Friday. Home sales, which have hit record highs during the pandemic, have slowed following a rapid rise in mortgage rates.

(Photo by David McNew/Getty Images)

“A similar cluster of economic conditions has occurred six times in the last five decades. Each of those six times, a recession has occurred within two years (and often earlier),” the nonpartisan Legislative Analyst’s Office wrote earlier this week in assessing California and the nation’s increased risk of an economic downturn.

With a population of 39 million — making up more than 11% of the US population — the health of California’s economy is key to the nation as a whole. According to the California Employment Development Department, California jobs grew 7.4% from January 2021 to January 2022 compared to the national rate of 4.6%.

Of course, part of the reason California has been able to add so many jobs over the past year is the staggering number of jobs lost in the first two months of the pandemic. It has taken the state more than two years to recover more than 90% of those job losses.

Still, new jobless claims remain high in California, with the state accounting for almost 24% of all new jobless claims in the state. California accounts for about 11% of the US workforce.

“It’s a picture of a government economy recovering, but I would say it’s in danger of going backwards or stalling,” said Michael Bernick, attorney at Duane Morris and former director of the California Bureau of Employment Development .

Nearly 80% of California’s job gains came from the major population centers in Los Angeles and the San Francisco Bay Area. Santa Clara and Marin counties had the lowest unemployment rates in the state at 2.1%, while rural Imperial County along the US-Mexico border had the highest unemployment rate at 11.7%.

Nationwide, eight of California’s industrial sectors added jobs in April. The biggest increase has been in the leisure and hospitality sectors, which have been hardest hit during the pandemic due to restrictions on public gatherings. The information sector – which includes things like publishing, cinema and sound recording, telecoms and broadcasting – has added 2,200 new jobs as the industry has now recovered all of the jobs lost during the pandemic.

The biggest job losses were in construction, which lost 13,200 jobs in April. State officials said most of the losses were caused by foundation, exterior work and finishing contractors who were hit by April’s rain.

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