The Economic Data Global Express (e-EDGE)

v.4 n.46       Released Nov. 13, 2000 
Produced by the Los Angeles County Economic Development Corporation as a public service to the global community.

LOCAL, STATE UNEMPLOYMENT RATES DOWN IN OCTOBER

     California's headline unemployment rate was 4.7% in October, down from 4.8% in September and 0.3% points below October 1999.  (These figures are adjusted for normal seasonal variation.)  October's unemployment rate was just barely above February's weather-reduced 4.6% rate, which stands as the low point of the current economic upswing.  Even better, with 10 months already counted, it looks like the state's unemployment rate for all of 2000 will be the lowest since 1969.  Wow!
     Jobless rates at the county level are not seasonally adjusted.  Most counties normally register lower unemployment in October than in September, and this year proved to be normal in every respect.  Los Angeles County's unemployment rate fell to 5.3% in October from 5.6% in September and from 5.7% in October 1999. Orange County's jobless rate was 2.3% in October, lowest in Southern California, and down by 0.2% points over the month and by 0.3% points over the year.  San Bernardino and Ventura counties' rates both fell in October, to 4.4% and 4.3% respectively, from 4.6% last October.  At 5.6%, Riverside County's jobless rate was high for the region last month, down by 0.5% points month-to-month but even with last year's rate.  San Diego's unemployment rate was 2.8% last month, down from 3.1% in September and from 2.9% in October 1999.
     The jobless rate in the 8-county Bay Area fell to 2.2% in October from 2.4% in September.  San Jose, with an unemployment rate of 1.6% last month, continued to test just how low unemployment can go.  The San Francisco MSA was not far behind at only 2.0%.  Compared to last year, San Francisco's unemployment rate was down by 0.2% points while San Jose's rate dropped by a full 1.1%.  Labor markets are also quite tight in the East Bay: Alameda/Contra Costa counties' jobless rate dropped to 2.5% in October versus 3.0% during October 1999.  Unemployment rates are higher in much of the San Joaquin Valley, with Fresno and Tulare counties, for example, registering 13.1% and 13.8% respectively last month and Kern County at 9.8%.  The Sacramento area continues to outpace the rest of the Valley.  Metropolitan Sacramento's jobless rate edged down to 3.7% in October.  (Nancy D. Sidhu)
PR: http://www.edd.ca.gov/nwsrel11.htm
 

OCTOBER EMPLOYMENT NUMBERS STRONG

     California's nonfarm employment in October was up over the previous month and over the year.  The latter gain was 3.2% or 445,300 jobs, which has to be called a strong performance.  (This is the "official" series, which is under-reporting job growth.)   The largest increase was in services, up by 186,700 jobs.  The government sector chipped in with 74,700 jobs, followed by retailing, up by 67,900.  On the manufacturing front, the October count was down by 1,800 jobs from last year.  However, the durable goods sector continued to inch up, helped by a 4,600 increase in electronics.
     In Southern California, the October job numbers also had a cheery tone.  Los Angeles County posted a 2.1% or 85,200 job increase over the year.  However, the local manufacturing sector continued its slide, with aerospace down by 8,200 jobs and apparel off by 3,400 (a larger decline than for the state).  The biggest increase over the year came in services, up by 44,000 jobs.  The spark here was provided by business services, up 16,100 jobs and by motion picture production with an increase of 10,300 (the strike bogeyperson is stalking Hollywood).
     Orange County's October nonfarm employment increased by 2.8% or by 37,700 jobs over the year.  Services accounted for 16,400 new jobs, while manufacturing was up by 4,500 jobs.  The Riverside-San Bernardino area saw its September numbers revised up, and got a good report for October.  Year over year growth was 4.4% in both months, with the latter month's nonfarm job count up by 41,500.  The service sector posted the largest gain, up by 12,800 jobs, while the area's manufacturing sector continued to climb, by 4,900 jobs.  However, San Diego County's nonfarm employment continued to ease, with October up by 1.8% or by 21,300 jobs.  The growth leader here was retail trade, up by 6,300 jobs.  Ventura County saw its October nonfarm growth rate jump, to 2.4% or 6,300 new jobs.  The service sector was the leader, with 1,800 additional workers.
     To the north, the October jobs report was also good.  The San Francisco metropolitan area posted a 2.5% or 25,900 job increase.  The San Jose area came in with a 2.2% gain, or 21,900 jobs over the year.  (Jack Kyser)
 

FED POLICY ON HOLD IN UNSETTLED ELECTION ENVIRONMENT

     As members of the Federal Open Market Committee (FOMC) meet this Wednesday to consider whether interest rates should be raised or left unchanged, they will deliberate in an environment significantly different from last summer.  First, national economic growth slowed in the third quarter with GDP registering an annual rate of only 2.7% compared to the torrid pace of the first half of the year.  Second, despite tight labor markets and high oil prices inflation has remained somewhat benign.  Third, the stock market has turned bearish and this gives rise to hopes that consumer spending will taper off.  Fourth, credit quality has become a mounting concern as debt ratios have risen.  Fifth, the stalemate over whether Bush or Gore will emerge as President has engendered an atmosphere of gridlock as far as the contenders' tax and spending plans are concerned.
     This last factor, gridlock between Congress and the President, is likely to be accentuated with a Gore Administration and Republican control of both houses of Congress.  But, even if a Bush Administration is the outcome, the narrow Republican majorities in the Senate and the House will make it difficult to enact sweeping changes.  In an atmosphere of such great uncertainty, a weak mandate for the Executive Branch of government and a sharply divided legislature, we may remain in a form of "fiscal paralysis."
     While we do not expect the FOMC to raise the Federal Funds Rate this week from the current 6.5%, we expect to see the tightening bias kept in place.  This will tell the markets that the FOMC is continuing to keep a close watch on inflation and that it is not planning to adopt a more relaxed monetary stance any time soon.  (Ken Ackbarali)
 

SEPTEMBER AIRLINE TRAFFIC MIXED                

"Mixed bag" describes the September airline passenger reports for Southern California.  LAX posted a 4.7% increase over the year in total traffic, while the international passenger count jumped by 12.7%.  The latter numbers have been strong since April.  Ontario saw a modest increase of 0.8% in September.  September traffic at Burbank-Glendale-Pasadena was essentially flat, down by 0.2%.  At John Wayne/Orange County Airport, traffic in September dropped 3.1% over the year, and, as previously reported, Palm Springs experienced a 4.1% decline.
     The September international air freight numbers at LAX were no fun, either.  Import tonnage dropped by 2.3% over the year, while exports eased 4.5%.  Total tonnage for the month was off 3.4%, the first year-to-year decline since February of 1999.  (Jack Kyser)

 

QUICK STATS:

* BLS: US export prices for 10/00: -0.1% (9/00: +0.5%)
* BLS: US import prices for 10/00: -0.5% (9/00: +1.2%)
* BLS: US Produce Price Index for finished goods for 10/00: +0.4% (9/00: +0.9%)
* Cal EDD: California unemployment rate for 10/00: 4.7% (9/00: 4.8%)
* Cal EDD: California nonfarm employment for 10/00: +63,900 (9/00: +97,700)
* Cal EDD: LA County unemployment rate for 10/00: 5.4% (9/00: 5.4%)
* Cal EDD: LA County nonfarm employment for 10/00: +24,800 (9/00: +40,300)
* Census: US wholesale trade for 9/00: +0.7% (8/00: +0.2%)
* Census: US wholesale inventories for 9/00: +0.2% (8/00: +0.6%)
* Fed: US consumer credit for 9/00: +5.2% annual rate (8/00: +10.1%)

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