The California Labor Market Information Division released its October 2017 report in November, showing extraordinary improvement in the unemployment rate.
Last month Ventura County reported the best September since 2006, at 4.7 percent and second-best going all the way back to the year 2000.
This month beats that as, at 4.2 percent, the county just had its best October on record since 2000.
Further demonstrating this month’s strong performance, average improvement since 2000, September to October, is by about one-tenth percent.
This month dropped by a full five-tenths, from 4.7 to 4.2 percent. Similar to last month, the extraordinarily positive news on the unemployment rate doesn’t carry over to the rest of the data.
Labor force growth, for example, is still dismal. Stalled at 432,500, the county’s work force hasn’t grown in nine years.
There are several causes; industry growth is slow, so there aren’t a lot of jobs to draw workers in. The population is becoming an older demographic with more retirees. Youth and young families are leaving for lower cost regions. Immigration is flat or even negative.
Whatever the cause, the lack of growth in the labor force means less human capital and a more limited pool from which businesses can hire the skilled workers that are needed to be competitive.What’s more, the depressed labor pool contributes perversely to the low unemployment rate, masking other weaknesses in the economy.
Looking at industry employment, the county had an excellent total gain of 4,600 jobs, though 2,900 came in the farm sector. That’s a big jump, but only enough to keep the county just roughly even with a year ago, this year at 25,600 jobs, down marginally from 25,700 in 2016.
Of the 1,700 non-farm jobs gained in October, 1,600 were in local education. The county had a net gain of only 100 jobs in the non-farm private sector. Contrasting with the outstanding unemployment rate, that’s an extremely disappointing number.
On the upside: 600 jobs in retail were gained, which bucks a recent trend of losses. That noted, the county is still down in retail by 1.5 percent year-over-year and these aren’t the jobs needed to create economic growth.
On a small-scale, but significant still for direction, both construction and manufacturing gained 100 jobs in October. Construction is up 900 jobs year-over-year, an 11.8 percent gain. That’s incredibly encouraging and there’s hope the gains will continue.
On the downside: For the second month in a row, a loss in professional, scientific and technical services, this month by 700 jobs.
Earlier this year growth was encouraging in this sector, but the last two months have all but wiped out the year’s gains.
Jobs in this sector are a broad mix of professions and distributed across a wide range of employers, so it’s difficult to get a handle on why the volatility. That noted, it’s discouraging to see the losses.
Education and health services dropped 500 jobs in October, though the sector is still up by 2,700 jobs and 5.9 percent year-over-year. A lot of volatility can be seen in this sector month-to-month—even while on a year-over-year basis the increases have been strong and consistent—so the drop in October isn’t by itself disturbing.
Still, the year-over-year gain of 5.9 percent is just about the lowest it’s been at any point in the last decade, so it will be something to watch.
Leisure and hospitality, the other persistently strong sector over the last several years, was flat in October, after shedding 100 jobs in September, and has slowed considerably over the last year.
Similar to the point above on health services, this sector has been the driver of job growth over the last decade, but is showing signs of slowing.
Unemployment rate in the statewide context: Reversing a run of four consecutive months of declines, Ventura County’s comparative standing improved to 19th among California’s 58 counties, down from 24th in September.
What’s remarkable is that the county’s 4.2 percent unemployment rate ranks only at 19th. What that says is that much of California is continuing to perform at an exceedingly high rate.
Looking just at unemployment rate, it would be ridiculous to say that 4.2 percent is mediocre performance, the rank at 19th is fine.
That noted, this section of the report would be more telling if the county ranked its comparative performance on, say, job growth or labor force growth or any number of other indicators.
This month’s detail on unemployment rates can be viewed at labormarketinfo.edd.ca.gov/.
Bruce Stenslie is the president/ CEO of Economic Development Collaborative-Ventura County.