Merced County's unemployment rate dropped to 17.8 percent in February from 18.4 percent in January, an improvement that can be largely attributed to more jobs in education.
But a spike of commercial interest in Merced could be an indicator of future improvements for the area. Most recently, Chipotle Mexican Grill and Panera Bread have expressed interest in moving into the former Blockbuster building at Olive Avenue and R Street.
Julie Nelson, an associate city planner, said Merced got an application from the restaurants March 22. The Site Plan Review Committee will consider approving the proposal during a meeting Thursday.
Once that happens, the companies can submit for building permits.
As proposed, Panera Bread would occupy 4,200 square feet of the building, while Chipotle would take up 2,000 square feet, Nelson said. Panera Bread would also have a drive through.
Frank Quintero, Merced's director of economic development, said the city has seen more curiosity from the commercial sector recently. The application from the two restaurants is an example of that.
"We have seen an increase in commercial interest in Merced," he said. "We have hosted more leasing agents, retailers and brokers wanting to know more about doing businesses with and in the city of Merced."
Part of the goal is to allow residents to stay home and spend their money locally, Quintero said, adding that the city is trying to broaden its retail and service base to provide more to the community.
Quintero said there are promising signs for the area.
"Recently, the Bureau of Economic Analysis came out with their report on gross domestic product and for the state of California, the city of Merced ranked No. 9 out of 20, so it was nice to be in the top 10 for economic growth based on output of goods and services," he said.
The city is still marketing itself to industrial and commercial users in an effort to further stimulate the local economy, Quintero added.
"We believe it'll pick up," he said. "Right now, Merced is off the respirator. However, we are proceeding with caution. We're still a bit in the ICU and proceeding cautiously."
For now, Merced is dealing with an unemployment rate that's fourth-worst in the state, data show. Out of a 113,100-person work force, 20,200 are unemployed.
A lot of the employment loss from January to February came from more seasonal retail jobs being cut after the holiday shopping rush, said Pedro Vargas, a labor market consultant for the Employment Development Department.
The biggest increase in employment came from government employment, which posted an increase of 400 jobs, Vargas said.
He's encouraged by the overall decline in the local unemployment rate.
"I like the fact that it's going down and I hope that it continues to go down because farm work is going to pick up," Vargas said. "I've noticed a lot of farmworkers already out there working."
February's jobless rates totaled 17.7 percent for Merced City, 18.2 percent for Atwater, 18.7 percent for Los Banos and 20.5 percent for Livingston, according to the EDD.
The national unemployment rate was 8.1 percent and the state unemployment rate was 9.7 percent for the same period.
Reporter Mike North can be reached at (209) 385-2453 or email@example.com.