Unemployment dips in August

There were faint signs of improvement in the Sonoma County job market last month, with unemployment dipping to 10.2 percent in August as teachers returned to their classrooms, according to a report issued Friday.

While the jobless rate receded from July’s high of 10.4 percent, the county posted its third straight month of double-digit unemployment, the state Employment Development Department reported.

“It’s modestly good news and relatively good compared to other parts of the state. But we’re not out of the woods yet,” said Ben Stone, director of Sonoma County’s Economic Development Board.

The slight drop in the county’s jobless rate was better than the performance of the rest of the state, where unemployment rose to a post-World War II high. The state’s jobless rate hit 12.2 percent, adjusted for seasonal factors, up from 11.9 percent in July.

The local economy added 900 jobs between July and August, primarily at schools, according to the EDD.

While there is little evidence of a broad-based expansion in the local job market, there were faint signs of improvement amid a growing consensus that the U.S. economy is slowly emerging from the Great Recession.

“There are some shafts of sunlight for the first time in quite a while,” Stone said.

Job losses slowed for the second straight month. The county lost 9,000 jobs in August, compared to a year ago, the smallest number since May.

There were 26,900 unemployed residents looking for work in August, down from 27,200 in July, the highest in records dating back more than a quarter century.

But the local economy is still far weaker than it was a year ago, when 16,200 people were unable to find jobs and unemployment stood at 6.1 percent.

Aside from teachers, modest job gains came in leisure and hospitality, health services, professional and business services, construction and manufacturing.

Losses came in farm jobs, transportation, financial activities, and other services.

Stone expects, however, that unemployment will go higher by the end of the year. Even though the recession may have abated, its impacts will continue to be felt as companies struggle and some ultimately go under.

Industries that rely on consumers will likely continue to suffer, and some won’t make it, Stone said. A furniture store that’s been hanging on for months might not see the bump in spending it hoped for, be forced to close before a recovery catches hold, and 20 people might lose their jobs, Stone said.

The local wine industry may also face some additional pain as sales of high-end wines sag, Stone said.

But the wine industry is also likely driving some of the August hiring, Stone said. The increase of 200 jobs in leisure and hospitality are likely attributable to a bump in Wine Country tourism during harvest, he said.

In Mendocino County, unemployment fell to 10.4 percent in August, down from 10.7 percent in July. There were 4,640 unemployed job-seekers, up from 2,870 a year ago, when the jobless rate stood at 6.4 percent.

In Lake County, unemployment sank to 15.1 percent in August, down from 15.6 percent in July. There were 3,950 unemployed job-seekers, up from 2,600 a year ago, when the jobless rate stood at 10.1 percent.

California was one of 42 states to lose jobs last month, when the national jobless rate hit 9.7 percent. The state is tied with Oregon for the fourth-highest unemployment rate nationally, behind Michigan, Nevada and Rhode Island.

The state Employment Development Department said Friday that there were 2.2 million unemployed people in California last month.

Gov. Arnold Schwarzenegger said the jobless rate reinforces the importance of addressing California’s economic problems, including its antiquated tax structure and the water shortage in the Central Valley.

“While I am pleased to see fewer jobs lost, my administration will not rest until job growth resumes and employment returns to normal,” he said in a statement.

The Associated Press contributed to this report.