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JOBS: Unemployment at highest level since 1995
Retail stores, builders, schools slash jobs
By CHRIS BAGLEY - Staff Writer | ∞
San Diego County's jobless rate shot up to its highest level in 13 years last month as mortgage brokers, hardware stores and construction companies continued to slash payrolls in response to the cratering housing market.
Local unemployment surged to 6.4 percent in July from an upwardly revised 6 percent in June, 5.5 percent in May and 4.9 percent a year ago, the state Employment Development Department reported Friday. That is the highest rate since October 1995, when Southern California was still recovering from severe cuts in the defense industry. The number of unemployed people in San Diego County grew by 6,400 last month, to 101,000.
Job numbers fell most dramatically at school districts, because of the annual lull between retirements and hires and also to the state government's attempt to narrow its $15 billion deficit.
But retail stores, builders and financial firms also continued to shed jobs at a time of year when they traditionally have added workers. Residential and commercial builders have cut 2,300 jobs locally, including 200 in July, according to the state agency.
Statewide jobless numbers swelled by 70,000 to 1.35 million, and the unemployment rate jumped to 7.3 percent from a revised 7 percent in June, a somewhat rare occurrence for summer.
Hardest hit were areas where economies had relied on housing and construction. Unemployment in the two-county area of Riverside and San Bernardino rocketed to 8.9 percent from 8.1 percent in June.
"It all depends on your exposure to housing," said Christopher Thornberg, a partner with Beacon Economics.
The key factor in the housing bubble ---- tens of thousands of buyers who borrowed beyond their ability to repay ---- has affected other industries, too, Thornberg said. From the late 1990s into 2006, consumers financed all sort of purchases with home equity loans.
Consumers have pulled back this year, and most economists attribute that to home prices' decline of 20 percent or more from last year. Local retailers, including car dealers and clothing stores, have cut 2,200 jobs in the last year, or about 1.5 percent of their total work force.
"The problem we have in the U.S. economy is too much spending, too much debt," Thornberg said. "This is an economy that will underperform for a number of years."
On the flip side, some analysts also have blamed tightened credit for limiting some companies' ability to invest.
Brandi Nicklaw was laid off in April from her job as an interior designer for Office Pavilion of San Diego, in Mira Mesa. Since then, the company has closed its doors, Nicklaw said.
Nicklaw hasn't been able to find another full-time job in interior design, and only part-time work with an office designer in Bonsall, she said. Her fiance's contract for handling information technology for a major national bank expires at the end of the month, and the company is unable to hire him on a longer-term basis, she said.
"I'm penny-pinching to get by right now," she said.
Companies now have about 10 percent fewer temporary workers than they did a year ago, an executive in the temp industry said. The executive, Phil Blair, said his Manpower franchise in San Diego and Riverside counties is actually doing better than that, but only because he has focused on a handful of expanding industries, including defense, medical devices and anything that involves high technology. Electronics manufacturers in San Diego County have added about 400 jobs in the last year, and companies that make transportation equipment have added about 500, according to the state.
Many companies are expanding, Blair said, but more are doing so at a measured pace: One client, a distributor that serves convenience stores, recently scaled back a request for workers.
"Companies are very cautious about hiring," Blair said.
Private-sector employers in San Diego County had fewer people on the payroll last month than they did in either July 2007 or July 2006.
Even employment at local school districts, which had continued to grow into this spring, shrank by 8,000 last month. That number reflects the annual gap between retirements and back-to-school hiring, but it also reflects layoffs by school districts caught in the teeth of the state's budget crisis.
Declining enrollment has further reduced state funding to some districts, including the Temecula Valley Unified School District, where school officials point to record numbers of families losing homes to foreclosure. Carlsbad resident Jennifer Scholz, a second-grade teacher there, was one of 20 teachers who were laid off and haven't been rehired.
Some of those teachers will be able to make ends meet by substituting, but Scholz said that's not a good option because she gave birth to a son a couple of weeks after losing her job.
"I have to have something concrete so I can put him in a day care center," she said.
Contact staff writer Chris Bagley at (760) 740-5444 or cbagley@nctimes.com. Bagley blogs about local economic trends at www.nctimes.com/blogs/minding_your_business.
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Excuse me wrote on Aug 15, 2008 12:38 PM:Mr. Employer but do you think you might lay off a few workers and hire legal workers? Please? Alot of American workers are not use to food stamps and welfare.
Tara wrote on Aug 15, 2008 12:42 PM:This is it!!! I am voting for Obama. At least if I get laid off, I can collect unemployment for years and get free healthcare. In fact, I might not even go back to work. When Obama gets elected, here’s me hoping I get laid off!!!!
robert wrote on Aug 15, 2008 1:54 PM:yes, voting for Obama will increase your odds of being laid off and collecting more benefits from the government. Let those hard working fools pay all the taxes while us smart ones who vote for Obama and company raise their taxes so we can relax.
to Tara and Robert wrote on Aug 15, 2008 4:01 PM:let us know how that plan "works" out for you. After the Election, they don't do what they said they would, remember ?
Dave wrote on Aug 15, 2008 10:58 PM:George W should be proud of himself...Around my social circles we don't call it unempoyment, we don't call it going broke, or out of business. We call it going BUSH! Thanks George.
Chief wrote on Aug 15, 2008 11:01 PM:Yall dont know what your talking about getting laid off to hire illegals. My job is laying off and thats it there is no hiring, period. No jobs for anyone. George has done a great job of destroying a nation.
BLAME BUSH... wrote on Aug 16, 2008 12:00 AM:THE GOP and Bush are responsible for this staggeringly high figure. The GOP sold it's soul to Big Business promptly took their sweetheart tax breaks and left the country. Bush will go down as the worst president in USA history.
local osider wrote on Aug 16, 2008 5:44 AM:How come I dont hear any pro Bush people talking right now??? I guess everyone knows by now that this has been the worst president ever and nobody wants to defend him..WMD's, Katrina, Increase of Poverty, collapse of financial and housing markets, trillions lost on something that could have been solved with millions of dollars in aid to overthrough failed states that harbor terrorists....Well at least Iraq has gotten a bit better, but other than that this will become known here like it is known around the world as a failed presidency...a dark spot on american history
Tuck wrote on Aug 16, 2008 7:39 AM:While I don’t like Jorge Bush, can you please provide concrete evidence to support the fact he is the “only” reason that a recession is occurring? Yes, he deserves some blame, but have you people ever heard of the business cycle. Further, let me remind you that your precious President Clinton also appointed Alan Greenspan (he’s the former Fed Chief), whom I consider the worst ever. You are right, Bush might be the worst president ever, but much of our economy is cyclical.
Obama wrote on Aug 16, 2008 7:41 AM:A vote for John Sidney McCain is a vaote for continued economic disaster (unless you're part of the upper 1% in income).
With one exception... the 1979-80 recession during Jimmy Carter's term--ALL major recessions of the last 55 years have occurred during Repub administrations. Beginnning with Ike (yes, economically, the Fifties weren't always so fabulous) and continuing with Nixon, Ronnie (the '82 doozie), and of course, the 1990-92 recession under Poppy Bush, Repubs--the party of "fiscal responsibility" --have been the ones in power in the White House when recessions have occurred. Coincidence? Hardly.
Tuck wrote on Aug 16, 2008 7:41 AM:Highest jobless claims since 1995. Who was president in 1995? Thanks!
Then and Now wrote on Aug 16, 2008 7:53 AM:After Bush's first term my staunchly Republican sister boasted that "there are more homeowners than ever since Bush became President." And now that sentiment can be replaced with "there are more housing foreclosures than ever since Bush became President." Her silence in the past year has been deafening.
Yes, please, Bush supporters speak up!
McCarthy Lives on wrote on Aug 16, 2008 9:18 AM:In particular - local osider.
Your request for Federal Involvement in our lives is truly terrifying, and counter-intuitive to our Constitutional rights....Katrina? Please research who the STATE officials were that should have done THEIR jobs in warning and organizing plans. Increase in poverty? - with Capital Gains tax at 15% many middle class American were investing in Mutual funds or CD's with unheard of rates. Where I do AGREE with you is I am not Pro Bush, for two reasons - PATRIOT ACT.....the other - he has too much power for one legislation, and the balance of power must be checked here.
Monica wrote on Aug 16, 2008 10:23 AM:This is why everyone hates our President, George Bush. It really has nothing to do with lack of work because you cannot directly blame him for that. It used to be that you judged a person on his word. President Bush doesn't put up with any nonsense and he's a man of his word. Something that is foreign to most Americans today. He does exactly what he says he's going to do...whether it's popular or not.
He calls me Blondie wrote on Aug 16, 2008 10:27 AM:I'm curious to know how many people lost their jobs as a result of the recent transit cuts imposed by North County Transit District. Our beloved elected official right here in San Diego county are the cause of that.
Chris Bagley - Staff Writer wrote on Aug 16, 2008 10:56 AM:To address Tuck's point: San Diego County's unemployment rate rose above 6.4 percent in June 1991, peaked at 8.6 percent in July 1993 and fell back below 6.4 percent in October 1995. I couldn't tell you offhand whether that cycle coincided with presidential policies. It probably had a lot more to do with the Pentagon's base realignment and closure (BRAC) and reduced spending on military weaponry.
GOODTIMEs wrote on Aug 16, 2008 12:02 PM:People don't you realize this is the best time in the world for wise people that have been smart and saved. Now we can buy up all the dirt cheap property and stocks that we want and laugh all the way to the bank...Thanks for being so foolish and spending all that money you never had!
Frida wrote on Aug 16, 2008 12:56 PM:Thanks a lot G.W. Bush! To think that Republicans are fiscally conservative? HA! Millions each day for a unnecessary war....
Greg in Oceanside wrote on Aug 16, 2008 2:59 PM:Tuck, I share your opinions, and your comments hit the nail on the head!
People want to blame the government for anything that goes wrong in their lives. GWB is not responsible for the economic challenges many are facing today, which are a result of forces beyond the control of the executive branch of our government. If there is any governmental branch to blame it lies with the Legislative Branch, particularly the Senators and Congressmen and women who spend our tax dollars and legislate bills and laws that affect us both positively and negatively.
Personally I don't have any friends, relatives, neighbors, or acquaintances that are affected by the current economy, with the exception of one neighbor who had to change jobs and leave the real estate industry and go back to a previous occupation. Everyone I know is gainfully employed and doing fairly well. Sure, not everyone is in this same situation and some are experiencing some difficulty. However, they are rare and are usually low-skilled, under-educated, and live paycheck to paycheck.
People are responsible for their own destiny and need to prepare themselves to become 'recession proof.' This is done through saving, investing, and career management, things that aren't the government's responsibility. They're yours.
Reagan Greenspan wrote on Aug 16, 2008 5:46 PM:Tuck wrote "Further, let me remind you that your precious President Clinton also appointed Alan Greenspan (he’s the former Fed Chief), whom I consider the worst ever."
Whatever you say about Greenspan, he was appointed by Ronald Reagan in 1987. So get your facts straight at least.
My Cents wrote on Aug 16, 2008 6:28 PM:Tuck is correct, Clinton (a Democrat) was in office in 1995. The question I ask is more about how he left office rather than how he started it since 1995 was early in his presidential career.
It's first important to note that every president gets the credit and/or blame for whatever happens while they're in office, whether they really had to do anything with it or not.
That said, I know my economy flourished overall under the 8 year Clinton administration. So did the economies of pretty much everybody I know.
I also know that my economy was stagnant if not negative during Bush Sr (pre-Clinton) and please don't even get me started about Bush Jr (post-Clinton). While it may not be a fact ... the Bush's are bad luck for our nation.
I also agree with Greg that the majority of people who have problems during this time are people who planned badly from the start. However, I also doubt the number of fiascoes that have taken place under this administration could have been foreseen. That doesn't mean that people are excused from being responsible for their own situations. I'm just suggesting that Bush's questionable (at best) policies/decisions/disasters have had more than just a minor effect on things.
I personally don't like anyone running for President today, but they certainly can't be any worse. I just know this country needs a change. We've suffered under the same idiocies long enough.
Perhaps it's time for a good old-fashioned revolt. Really shake up the broken system that allows this type of stupidity to flourish virtually unchecked. I only fear we've become too lazy as a society to truly do what really needs to be done.
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