Silicon Valley Spurs California Job Growth

U.S. experiencing uneven job growth across states

By CHRISTOPHER S. RUGABER
|  Friday, Mar 25, 2011  |  Updated 5:15 PM PDT
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U.S. companies have added jobs for 12 straight months, giving some of the hardest hit states a lift. But the gains have been uneven and several states are still losing jobs.

California and Michigan, which each suffered some of the worst  job losses during the recession, are adding jobs again. California last month had its single best month for job creation in more than two decades.

Still, six states lost jobs from February 2010 through last month. Among the worst for job creation in that time were New Mexico and New Jersey, states that only a year ago were in the
 middle of the pack.

Overall, 44 states added jobs in that stretch, one of the best year over-year showings since the recession ended in June 2009. And the unemployment rate has fallen in 41 states. The February report from the Labor Department on state and regional employment is the latest sign that job growth is picking up.

Nationwide, employers added 1.3 million net jobs in that period.

California, which was still losing jobs as recently as September, has added nearly 200,000 jobs in that time. That's second only to Texas, which added 254,200 net jobs.

Nearly half of that increase in California occurred in February, when the state gained 96,500 jobs. That's the most on records dating back to 1990.

The nation's largest state by population still has a long way to go to recover the 1.3 million jobs lost during the recession, which began in December 2007. But analysts were encouraged by the recent gains.

"California ... has been lagging the United States a bit, but it seems to be catching up this year,'' said Jerry Nickelsburg, senior economist with the University of California, Los Angeles'
 quarterly Anderson Forecast.

The job gains are broad-based, Nickelsburg said, noting that they occurred in manufacturing, transportation and warehousing and information technology. Even construction firms added about 15,000 jobs. But those were most likely for commercial real estate and infrastructure projects, rather than housing, Nickelsburg added.

Rising imports have boosted jobs among shipping companies that take the goods from ports and distribute them around the country.

Internet services firms have also been a major source of growth.

Google Inc. has been on a hiring spree, adding 4,600 employees last year. It plans to add 6,200 more in 2011, though some will be overseas. Zynga, which developed the popular "FarmVille'' game for Facebook, has been hiring rapidly. It was founded in 2007 in San Francisco and already has 1,500 employees.

California isn't the only state getting back on its feet.

Michigan added 71,000 jobs in the same period. That's the first sustained job gain the state has seen in the past decade, said Sophia Koropeckyj, a managing director at Moody's Analytics.

The state is benefiting from a turnaround in the auto industry.

Both General Motors Co. and Chrysler LLC have boosted sales and employment since emerging from bankruptcy in 2009. Both said late last year that they would each hire 1,000 engineers and
 researchers.

Ford Motor Co. announced earlier this year that it will hire 7,000 workers in the next two years.

Overall, Michigan has added 28,000 manufacturing jobs in the past 12 months.

At the same time, Michigan no longer has the nation's highest unemployment rate. It has plummeted over the past year from 13.5 percent to 10.4 percent, the biggest drop in the nation. Half of the decline reflects a large drop in the state's work force. Once unemployed workers give up looking for jobs, they are no longer counted as unemployed.

But six states still experienced job losses over the past year Arizona, Kansas, Missouri, Nevada, New Mexico and New Jersey.

Most of the losses were small. As a percent of their work forces, Kansas reported the biggest loss. Layoffs by telecommunications companies, particularly Sprint, have cost Kansas a net total of 10,500 jobs in the past year. Insurance companies, restaurants and bars also cut jobs.

New Mexico's payrolls have fallen by 6,800 since February 2010.

The drop mostly reflects small losses from many firms rather than any large layoffs, business leaders say. 

"It's like a duck nipping at our ankles. It's a little bit here and a little bit there and before you know it, it becomes a big number,'' said Terri Cole, president and CEO of the Greater Albuquerque Chamber of Commerce.

Construction firms and governments have cut jobs. And while the state produces oil and natural gas, it hasn't benefited as much as its neighbors, Texas and Oklahoma. That's because those states produce more oil. New Mexico focuses more on production of natural gas, said Jim Peach, an economics professor at New Mexico State University. Natural gas prices have fallen sharply in recent years as new supplies have been found in West Virginia and Texas.

 New Jersey, which lost 6,500 jobs in the past 12 months, has suffered from cuts in the pharmaceutical industry. Several large companies have combined and cut staffs in the face of growing generic competition. Pfizer, for example, bought Madison, N.J.-based Wyeth in 2009. Before the recession, about one in every seven pharmaceutical industry jobs were based in New Jersey.

"I thought it was a great industry to be in. I never thought I'd be out of work because there were so many opportunities to choose from with so many firms around here,'' said Justin Mangiore, an Ocean County resident who worked as a sales representative for several pharmaceutical firms before losing his job last winter.

Growing competition has also hurt its casino industry, as neighboring states such as Pennsylvania and Delaware have recently allowed gambling.

Atlantic City's unemployment rate is above 14 percent and has barely budged in the past year, even as the nation's jobless rate has fallen by almost a percentage point.

"It doesn't have the monopoly it once had,'' said James Hughes, a dean and regional analyst at Rutgers University. "It was like Las Vegas east there for a couple of decades.''

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