California unemployment rate rises, but payrolls grow

dkasler@sacbee.comAugust 17, 2013 

Unemployment rose in California and Sacramento last month, although there were signs the state's economy continues to expand.

The statewide unemployment rate increased to 8.7 percent, up two-tenths of a point, the Employment Development Department said Friday.

Nonetheless, employers added 38,100 jobs to their payrolls during July.

The two statistics are based on different surveys.

Generally, economists put more faith in the payroll jobs number, which is based on a larger survey.

In Sacramento, the unemployment rate rose to 8.9 percent in July – a half-point jump from a month earlier.

The four-county region lost 13,500 jobs.

Much of the job loss was seasonal, as schools continued their end-of-year cutbacks.

But some of the job loss was puzzling to experts.

According to EDD, the construction sector shed 500 jobs in July, and has lost 4,100 jobs over the past year.

The numbers would seem to contradict strong evidence that the housing market is finally recovering, and construction activity is picking up.

The EDD's report "makes the local data look worse than it actually is," said economist Jeff Michael of the University of the Pacific.

He said the payroll figures sometimes underestimate job growth during an upturn in the economy.

Diane Patterson, a consultant with the EDD, said the construction job losses occurred in the "residual" sector, which includes highways, bridges and other public works projects.

Even with the job losses in July, the region has added 5,000 jobs in the past year.

Unemployment in the past year has fallen from 10.9 percent to 8.9 percent.

Call The Bee's Dale Kasler, (916) 321-1066. Follow him on Twitter @dakasler.

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