Not Your Father’s Recession

California’s workers continue to face the toughest job market in a generation. The state’s unemployment rate dropped slightly to 11.0 percent in April from March’s record high of 11.2 percent. However, the data released today should not be interpreted as a sign that the recession is losing steam. Data from a survey of California employers – considered to be a more reliable indicator of the economy – show that the state lost another 63,700 jobs in April.

Moreover, the unemployment rate actually understates the current weakness in the labor market. A more comprehensive measure shows that, on average, nearly one out of six working-age Californians – 16.4 percent – was either unemployed or underemployed during the 12 months ending in April. This figure includes nearly 1.2 million workers who want full-time jobs but have had to settle for part-time work, as well as the 267,000 jobless Californians who would gladly take a job if they could find one, but aren’t officially counted as unemployed because they’ve given up looking for work.

Even if the economy hits bottom soon and begins to grow again, Californians can expect a long road ahead to recovery. Most forecasters expect the job market to rebound slowly. For example, the recent Department of Finance projections show the state’s annual jobless rate peaking at 12.0 percent in 2010 and remaining in the double digits at least through 2011. This isn’t surprising considering that California needs to add nearly 780,000 jobs just to return to pre-recession employment levels. To put this number in context, California added about 269,000 jobs between 2004 and 2005, which was the largest annual increase in jobs in the state this decade.

The prospect of a long, slow recovery means that health and human services programs – which play a critical role in helping to cushion the recession’s impact on California’s families – are likely to face increased demand for some time. However, many of the programs that form the backbone of California’s safety net are slated for deep funding cuts in the Governor’s latest budget proposals. These cuts threaten to stretch the state’s safety net too thin to catch all of the families struggling to make ends meet during the worst downturn in decades.

— Alissa Anderson

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