Merced unemployment dips to pre-COVID low, despite concerns over U.S. economy’s future
As soaring gas prices, inflation and weakening consumer confidence continues to stir concerns about the U.S. economy’s future, California Employment Development (EDD) data released Friday offers some optimism for Mercedians.
The county’s May unemployment rate dipped to pre-pandemic levels for the first time since COVID-19 ravaged the local and global economy in early 2020.
Merced County joblessness sunk to 6.2% in May, down from 7.4% in April and 10.5% a year earlier, according to the EDD.
The drop is even more notable compared to unemployment rates two years earlier in May 2020, when the COVID-19 pandemic was in its earliest, most unpredictable days.
“It is a significant reduction from May 2020, when unemployment hit 16.3% and more than 18,000 Merced County residents were out of work,” EDD Labor Market Consultant Steven Gutierrez told the Sun-Star.
Local unemployment hasn’t been as low as May’s rate since September 2019, when joblessness descended to 6%.
Which Merced County industries saw job gains
Gains made last month can largely be attributed to farm labor, which saw over 17% growth from April to 15,500 jobs. Farm employment is an expected trend for this time of year, according to labor experts.
“This is kind of the seasonal trend that we’ll see during this time,” Gutierrez said. ”‘The Central Valley always has an uptick in farm employment during this time of year.”
Increases in the farming sector are expected to eventually spill over to other industries, like manufacturing and transportation, as goods are packaged and distributed elsewhere.
Year-over farm jobs gains amounted to 300, or 2% growth.
Merced County also saw a boost in government jobs last month. The 300 jobs added since April and 900 jobs gained since last year were mostly local government positions, according to the EDD.
The mining, logging and construction industry, manufacturing field, educational and health services sector and leisure and hospitality business each saw month and year-over gains, too.
Economic concerns linger amid an uncertain future
In total, an estimated 109,500 people were employed in Merced County last month, up from 103,400 a year earlier and 107,100 in April.
The Merced County labor force grew by 1,200 people between April and May — an encouraging sign for employers struggling to maintain their work force, Gutierrez said.
Still, as gas prices soar to record highs and inflation levels rise to their highest point in 40 years, many Americans worry a recession could be around the corner.
President Joe Biden this week said he doesn’t believe a recession is inevitable in the U.S., despite those concerns.
Gutierrez acknowledged the long-term economic outlook for California and U.S. is uncertain. “Rising inflation has eaten into the pocket books and eroded the spending power of the consumer,” he said. “There are just still too many unknowns out there . . . at least right now, things seem to be looking up.”
Employment improved statewide in May as well, with California joblessness descending to 4.3%, according to seasonally adjusted EDD numbers. That’s only slightly higher than pre-pandemic unemployment of 4.1% in February 2020.
Here’s how unemployment changed in other Valley counties:
Fresno County unemployment dropped to 5.2% in May, down from 6.1% in April and 9.3% a year earlier.
Madera County unemployment dipped to 4.9% in May from 5.8% in April and 9% a year earlier.
Stanislaus County unemployment was 4.5% in May, down from 5.1%in April and 8.6% a year earlier.
Tulare County unemployment descended to 6.5% in May from a revised 7.4% in April below the year-ago estimate of 10.7%.
Kings County unemployment was 5.6% in May 2022, down from 6.6% in April 2022 and 9.6% a year earlier.
This story was originally published June 17, 2022 at 3:35 PM.
