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Friday, Aug 19, 2022
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Pandemic May Have Caused ‘Structural Change’ in Labor Market, Per LAEDC Briefing

Despite a reduction in weekly unemployment claims in L.A. County, regional recovery from the economic impact of the COVID-19 pandemic remains slow going, according a briefing Monday by the Los Angeles County Economic Development Corp.

“(Unemployment insurance) claims have not been this low since the beginning of the pandemic,” Shannon Sedgwick, director of the Institute for Applied Economics, said in the briefing. “In September, the unemployment rate was 8.2 percent. This is down by 5 percentage points from last year, when we were still operating under restrictive health orders. So we’re showing we’re in a much better place. However, when we compare that unemployment rate with the rate in the prior year, we see that we’re still 3.7 percentage points higher than in the pre-pandemic months in 2019.”

According to data released Friday by the California Employment Development Department, L.A. County’s 8.2 percent unemployment was higher than the state average of 6.4 percent and Ventura County’s 5.3 percent. Nationally, unemployment was 4.8 percent in September.

Federal unemployment benefits and the Pandemic Unemployment Assistance (PUA) program, which provided supplemental payments to unemployed and self-employed workers, both ended by Sept. 11. Economists and business owners praised the reduction in benefits, forecasting that workers would be more inclined to find work with reduced benefits. While unemployment insurance claims have decreased in the month since, the September job report indicates only 56 percent of non-farm jobs that were lost in April and May of 2020 have been recovered.

“The worker shortages in California are indicating that the pandemic may have resulted in a structural change in the state’s employment,” Sedgwick said. “Decreased foreign immigration into California means less of an inflow of workers and increased migration of workers, especially blue-collar workers, to other states where real estate and the cost of living is cheaper, could have a negative impact on the state’s economy.”

Government jobs expanded by 19,000 positions over the month, the most of any sector. Specifically, government educational services were up by 15,700 jobs over last year. Private education and health and health services increased by 8,400 jobs with nearly three quarters of that gain in private educational services, with an added 6,100 jobs.

“Nearly all industries are still experiencing employment contractions when compared to that pre-pandemic baseline, even though we are adding above and beyond and doing so much better than we were last year,” Sedgwick said.

Katherine Tangalakis-Lippert
Katherine Tangalakis-Lippert
Katherine Tangalakis-Lippert is a Los Angeles-based reporter covering retail, hospitality and philanthropy for the San Fernando Valley Business Journal. In addition to her current beat, she is particularly interested in criminal justice topics, health and science stories and investigative journalism. She received her AA in Humanities from Moorpark College in 2016, her BA in Communication from Cal Lutheran University in 2019 and followed it up with a MA in Specialized Journalism from USC in the summer of 2020. Through her work, Katherine aspires to help strengthen the fragile trust between members of the media and the public.
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