San Luis Obispo County’s unemployment rate in May dropped to 3 percent for the first time since 1999, according to data from the California Employment Development Department released last week.
For reference, that’s the same year many of the students in this year’s high school graduating class were born.
The latest data continue a pattern of shrinking unemployment across the state and county. But some economists say that while it could still go lower, it does look like job growth is slowing down as the state and county approach “full employment” — the point at which everyone who wants to be employed is.
“I like to say we’re at cruising speed,” said Robert Kleinhenz, executive director of research at Beacon Economics. “You know when you get onto the highway and speed up and then you reach that speed limit and stay there? That’s kind of where California is.”
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Kleinhenz said SLO County in particular is doing well. In fact, he noted, the county appears to be adding jobs at about twice the speed of the rest of the state, based on the May data, while the size of its labor force, or the number of people who can or want to be a part of the workforce, has stayed the same.
This translates to the distinct possibility that unemployment rates this summer could fall below the 3 percent mark to historically low levels, he said. The county’s lowest unemployment rate on record is 2.7 percent, in October 1999.
“It can go lower,” Kleinhenz said. “With continued job gains and a flat or at some times even negative labor force growth, I don’t see any reason it couldn’t get down to 2.8 percent.”
Because of seasonal work fluctuations, which can be significant, unemployment data are typically compared with those of the same month year over year.
This month’s rate also compared well against the rest of California and the country. SLO County’s rate was lower than the 4.2 percent rate for California and the 4.1 percent for the nation in the same month.
The May rate ties SLO County with Sonoma County for fifth lowest unemployment across the state’s 58 counties. San Mateo County had the lowest with 2.4 percent, and Imperial County had the highest with 20.5 percent.
In May, about 137,500 people were counted as employed in SLO County out of a civilian labor force of 141,700. The labor force includes everyone working and looking for work.
Excluding those who are self employed, companies and agencies in the county reported 2,500 more jobs in May than in the same month last year — about a 2.1 percent increase.
As we head into the summer tourism season, the biggest gains were once again in the leisure and hospitality industry (i.e., hotels and food services), which added about 700 jobs since last year.
The mining, logging and construction category also reported large job growth this past month, adding 600 jobs between May 2016 and 2017.
The only major industry to report job losses was professional and business services, which had 300 fewer people employed in that industry this year than the same time last year.
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