The Breakdown | Explaining Southern California's economy
Business & Economy

California adds jobs, but August unemployment rate rises to 8.9 percent

 A job seeker shakes hands with a recruiter during a California job fair.
A job seeker shakes hands with a recruiter during a California job fair.
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California added more than 29,000 jobs in August, but that didn't make the state's unemployment rate better -- it rose slightly to 8.9 percent in August, up from 8.7 percent in July.

Job gains in August were in areas like construction, leisure, hospitality and financial services, according to a Bureau of Labor Statistics report released Friday.

California’s unemployment rate is still higher than the nation’s 7.3 percent rate.

The state's unemployment rate increased in part because  the labor force is shrinking, said Jerry Nickelsburg, senior economist with the UCLA Anderson Forecast. There's been a reduction in total employment and nationally, because some discouraged job seekers have stopped looking for work.

At the same time, Nickelsburg pointed out that California employers added more than 29,000 jobs, which the second highest amount of jobs added by any state in the nation in August. 

"We may be moving forward a little bit, but it may be one of these forward two steps, slide back one and a half," Nickelsburg said. "We're doing a little better than moving sideways but not tremendously." 

But local economists are predicting that the state’s unemployment rate will drop in a few years. The UCLA Anderson Forecast predicts the unemployment rate will drop to 6.7 percent by the fourth quarter of 2015.

Nickelsburg  told KPCC earlier this month that the economic recovery won’t be spread evenly across the state.

“The good news is that we are growing and that the rate of growth is going to increase,” Nickelsburg said. “The bad news is that we’re in our fifth year of recovery and we’re still not back to, in many cases, where we were in 2006.”

In the Los Angeles-Long Beach-Glendale area, the unemployment rate in August was 10.1 percent. That number is down from 10.9 percent a year earlier, in August 2012, but up slightly from  the area’s  9.9 percent unemployment rate in July 2013.