Update: San Diego unemployment rises to 10.5 percent

Written by Elizabeth Aguilera

9:49 a.m., Aug. 19, 2011

Sara Hahne, manager of the new Encinitas Kohl's, tracks applicants during the interview process. More than 500 people came to the La Costa Resort and Spa on Monday to interview for one of 150 jobs. The new store is slated to open Sept. 28. — John R. McCutchen

Unemployment in San Diego County ticked up in July to 10.5 percent, up from a revised 10.4 percent in June, reaching a high not seen for nearly a year, according to data released Friday by the state Employment Development Department.

“Initially people might be discouraged that the unemployment rate was up,” said Alan Gin, economist at the University of San Diego. “But typically the unemployment rate rises in July, and the one-tenth of a percent increase is lower than it has been in past Julys.”

Mid-summer unemployment figures usually spike because of the influx of students into the workforce, summer employment and education-related transitions, experts said.

The county lost 6,500 jobs overall between June and July. In the past year the county added 20,100 jobs.

San Diego is faring slightly better than the state.

California’s seasonally adjusted unemployment rate rose in July to 12 percent, up from 11.8 percent in June. The state added 4,500 jobs in July after adding 28,800 jobs in June. The state now ranks second in joblessness, just below Nevada where unemployment is 12.9 percent. The unadjusted unemployment rate was 12.4 percent, up from 12.1 percent in June.

“This is the pattern we’re likely to see through 2011,” said Michael Bernick, former EDD Director and a fellow at the Milkin Institute. “There is no short-term fix.”

Nationally, the unemployment rate in July was 9.1 percent, down slightly from 9.2 percent in June.

Unemployment and job figures are the results of two separate surveys. Employers report the number of people they employ while the unemployment number is taken from household surveys. The unemployment rate includes people eligible to work who are actively looking for work. It does not include people who have given up looking for a job.

The majority of San Diego County jobs lost in July were seen in the government sector, down 11,200 jobs, particularly in local education, which lost 9,100 jobs, the EDD found.

The decrease was offset by industries that added paid positions in July including professional and business services and leisure and hospitality. Construction, finance and real estate also saw minor increases, a positive sign in areas that have suffered crushing losses due to the recession.

Despite the dismal tone of the report, economists say the employment picture is not as bad as it seems.

“It was a surprisingly good report and it does not suggest that San Diego is on the brink of falling back into recession,” Reaser said. “If you adjust for the normal seasonal influences you saw quite a positive impact on the economy.”

Reaser and Gin both seasonally adjusted the figures, to minimize cyclical factors, and found improvement.

Reaser’s seasonally adjusted figures show a gain of 5,400 jobs in July and 10.2 percent unemployment rate, a one-tenth of a percent dip from the month prior.

So far this year 16,800 jobs have been created in San Diego County. Local experts forecast job creation for the year would be around 18,000. At this pace job creation in 2011 could double last year’s 10,000 new jobs, Reaser said.

“We are still digging our way out of a very deep hole but we are coming out of it,” Reaser said. “In a couple of years it looks like we will have regained about half of the job losses.”

Gin’s seasonally adjusted figures show a gain of up to 9,000 jobs between June and July and he found unemployment fell to 9.8 percent in July from 9.9 percent in June.

“What this shows is that although we are not out of the woods, we are not likely to head into a double dip,” Gin said.

Adecco, a staffing provider, is having its best year since 2008. Employers are keeping temporary workers longer and some are increasing direct hiring, said Christa Shapiro, regional vice president for the firm.

“We are seeing a big trend in sales and marketing positions, which is a great indicator that businesses are wanting to get out there,” Shapiro said. “It tells us that people are feeling the economy is turning.”

Source: SignOnSanDiego