Editorials

LOS ANGELES – California’s jobless rate dipped to 6.3 percent in July, down from a revised 6.5 percent a month earlier, as the state added 7,500 payroll jobs, officials said Friday. 

Most of the growth came from the government sector, which showed a net gain of 24,000 positions on a seasonally adjusted basis, according to the state’s Employment Development Department. 

The wholesale and retail trade sectors also added to their ranks, offsetting thousands of job losses in the manufacturing, services and construction industries. 

Economists were lukewarm about the decrease. 

“The economy is flat, it’s mirroring the national trend,” said Stephen Levy, director of the Center for Continuing Study of the California Economy. “For the (San Francisco) Bay area, it’s good the economy has stopped falling. For the rest of the state, it means we’re still waiting for a recovery.” 

The number of people unemployed in California decreased by 46,000 to 1.1 million, but the state jobless rate remained higher than the national figure. U.S. unemployment was unchanged at 5.9 percent in July. 

“The (monthly) decrease in the unemployment rate appears to reflect consumer confidence in the economy,” said Jeanne Cain, vice president of government relations for the California Chamber of Commerce, citing the additional 6,000 jobs in wholesale and retail trade. 

“But in terms of more significant growth, we are concerned about upcoming legislation,” she said. 

Legislative efforts to pass bills increasing payroll taxes and giving Indian communities veto power over some infrastructure projects could jeopardize the economy’s ability to rebound, she said. 

In addition, a projected $10 billion state deficit for budget year 2003-2004 could mean fewer government jobs, she said. 

Many of the 24,000 new public sector jobs reported in July were teaching positions. But experts anticipate job growth in public education will plateau or even decline in the coming months, as school budgets feel the pinch of the state budget shortfall. 

With the state employing about one of every seven California workers, the budget deficit is a “big deal” for the job market, Levy said.