Job losses pile up
Published: Friday, April 17, 2009 at 11:13 a.m.
Last Modified: Friday, April 17, 2009 at 11:13 a.m.
Sonoma County unemployment soared to 9.8 percent in March, almost double the rate from a year ago, as the economy remained stuck in reverse, state labor analysts said Friday.
Over the past year, the local economy has shed 8,600 jobs, the largest number in records dating back to 1983. An all-time high 25,900 county residents were unemployed and looking for work in March, up from 13,600 a year ago.
The jobless ranks now are being swelled by people who were formerly self-employed, said Robert Eyler, an economics professor at Sonoma State University.
The self-employed come from a variety of sectors, including real estate, high-tech consulting, construction and restaurants. Until now, they’ve avoided the full impact of the downturn, he said.
“A number of the self-employed are no longer in business,” said Eyler, who heads SSU’s Center for Regional Economic Analysis. “Small business is more exposed to the recession.”
The county’s jobless rate stood at 5.2 percent a year ago, but it has risen steadily as the recession rippled from housing and finance to the rest of the economy.
The retail sector has been especially hard hit over the past year, as anxious consumers tighten their belts.
“People aren’t shopping,” said Ben Stone, who heads the county’s Economic Development Board.
Department store employment is down more than 19 percent — about 700 jobs — since early last year, and will fall even farther with the pending closure of the Gottschalks store at Coddingtown. It joins a growing list of retailers that have closed their stores in Sonoma County, including Mervyns, Circuit City, Linens-N-Things, Shoe Pavilion, KB Toys and Home Depot’s Yardbirds outlet in Petaluma.
Construction companies, manufacturers, business and professional service firms, finance companies, restaurants and hotels have also sharply cut their workforces over the past year.
Each day, 50 to 75 new clients show up at Sonoma County’s Job Link center in Santa Rosa, which offers counseling, employment listings and other services for job seekers.
“We’re seeing more blue-collar folks who just haven’t been in this position before,” said Karen Fies, who oversees the program. “They don’t quite know what to do.”
Clients are finding new jobs, but there’s lots of competition, she said.
Statewide, unemployment was a record 11.2 percent in March, up from 10.6 percent in February. More than 2 million Californians were out of work last month, compared to 1.2 million a year ago.
Only three states — Michigan, Oregon and South Carolina — had higher jobless rates, according to the federal Bureau of Labor Statistics. Nationwide, unemployment stood at 8.5 percent in March.
There are small signs of improvement in the local economy, Eyler said. Government has gained 300 jobs since February, largely because of the federal stimulus program, he said.
The six-week rally on Wall Street could signal the start of a turnaround, Eyler said. But high unemployment won’t end anytime soon, he said.
“We’re going to struggle through the rest of this year,” Eyler said.
The county’s unemployment rate will probably top 10 percent before it stabilizes and starts to decline, he said.
Sonoma County still is in better shape than most of California. Only nine counties have lower jobless rates, according to state figures.
In Mendocino County, March unemployment was 11.7 percent, up from 11 percent in February.
Lake County’s rate was 16.5 percent, up from 15.9 percent the month before.
With nearly 859,000 Californians receiving regular unemployment insurance benefits in March and the number continuing to grow, Gov. Arnold Schwarzenegger said Friday he would expedite the hiring of an extra 1,150 workers to staff unemployment call centers.
The agency is in the process of hiring about 850 workers to be paid from federal funds. He said the agency will also be authorized to contract out services and borrow personnel and office space from other state departments to help reduce wait times for unemployed people seeking benefits and services.
The agency already has extended its call center hours and opened several of its centers on Saturdays to deal with the surge in claims.
Last month, Schwarzenegger signed legislation allowing California to tap into $3 billion in unemployment funds included in the massive federal stimulus package. It allows workers to receive benefits for up to 79 weeks and collect an extra $25 a week through July 3, 2010. Payments range from $65 to $475 a week.
The rising jobless rate has strained the state fund that pays jobless benefits.
In January, California began borrowing from the federal government to keep its unemployment insurance fund solvent. The employment department projected the state will need to borrow $2.4 billion through year’s end and $4.9 billion in 2010 if the state doesn’t adjust its benefits or taxes on employers.
The Associated Press contributed to this story.
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