New Jobs Will Help California's Battered Economy

California's long bout with economic distress may not be over, but the Golden State is finally adding significant numbers of new jobs.

The latest figures from the state Employment Development Department show that California added 365,000 nonfarm jobs during the fiscal year ending in July. That's the largest job gain for the state since 2000.

The number also represents 13.2 percent of all the jobs gained during that period, according to the U.S. Department of Labor.

These developments have resulted in the unemployment rate dropping to 10.7 percent from 12.0 percent one year ago. That's still the third highest in the nation (behind Nevada and Rhode Island) but moving in the right direction.

The addition of 365,000 new jobs bodes well for state and local governments. With the average Californian paying $1,229 in state income taxes (2010 figures), the additional workers should add about $4 billion to state coffers during the coming fiscal year. No, that doesn't wipe out the $8 billion deficit, but it's a nice down payment.

The addition of new jobs will also help local governments, courtesy of new purchasing power and the sales taxes that come with the spending.

There's another benefit: with 365,000 more employed people over the past year, state and local governments will not have to shell out as much for social welfare programs. That means less going out for Cal-Works and other safety net programs.

With more people employed, voters may also look a little more kindly toward Governor Jerry Brown's temporary tax hikes ballot proposal this November. It's always easier to vote for a new tax if you have a little more money to spend.

Don't get out the party hats just yet. California has lost about one million jobs over the past four years.

So far, the "recovery" has brought back almost half of those losses, so we have a long way to go. Still, over the past year, the number of jobs here have grown by 2.6 percent, well ahead of the 1.4 percent rate nationwide.

For the moment, at least, things may be looking up. And it's about time.

Larry Gerston teaches political science at San Jose State University and is the political analyst for NBC Bay Area.

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