Monday, August 24, 2009

Don't Call It a ‘Jobless Recovery'

By Robert Gammon
Mon, Aug 24, 2009 at 12:19 PM

Many national economists have said lately that the economy is showing signs of rebounding, despite the continuing dismal unemployment figures. But it's hard to see a recovery from here in California. The unemployment rate statewide jumped to 11.9 percent last month, the highest on record and far higher than the national average of 9.4 percent, the Chron reported. In June, California's jobless rate stood at 11.6 percent. Joblessness in the Bay Area was awful, but not quite as bad as it was statewide. Unemployment in Alameda County was 11.5 percent in July, and in Contra Costa County, it was 11.0 percent.

As the state economy continues to tank, cities and counties are feeling the effects more than ever. The Chron also reports the state Board of Equalization has taken the unusual step of telling 337 public agencies that they will receive even less sales tax revenue this month than projected because of the bleak retail market. Sales tax receipts in April, May, and June dropped 18.75 percent from the same period in 2008. The state had estimated that the decline would be not quite as bad - 14.4 percent. There was a bit of good news, however, when state officials announced that they will finally stop issuing IOU's next week. As of last week, the state had handed out more than $2 billion worth.

As for the housing market, which caused the downturn in the first place, there were some indications that it may be recovering -- although it's still too early to tell. The median home price in the Bay Area jumped again last month to $408,000, up 13.4 percent over June, accordng to the Chron. The number of existing home sales also increased. Experts credited the rise in home prices to an increase in the number of luxury homes that sold and a decrease in the number of foreclosures that changed hands. Foreclosures accounted for 34 percent of sales, down from the high of 52 percent in February. At the same time, there remains evidence that banks are holding foreclosed properties off the market and that the number of foreclosures could significantly increase as more and more people remain out of work or lose their jobs.

Most Popular Stories

Best of the East Bay


© 2021 Telegraph Media    All Rights Reserved
Powered by Foundation