Unemployment Rate of 11.2% in March Highest Ever on Record
This is one record that California certainly won't be proud of.
The state posted its highest ever unemployment rate on record in March. The official number was 11.2%, which is the highest ever unemployment rate in California since the federal government started collecting statistics for individual states.
This number is up from the 10.6% rate that was posted in February, and WAY up from the 6.4% rate that was posted a year ago.
State officials have warned that they see the unemployment rate in the state worsening over the next six months. At that point, things are expected to begin to improve.
It should be noted that the 11.2% unemployment rate that was posted in March is the U-3 rate - some have publicly stated that they believe that the U-6 unemployment rate is approaching the 20% mark in the state. The U-6 rate is a broader measure of unemployment, and includes people who want full-time work but have given up the search, as well as people who want full-time work but are forced to accept part-time jobs due to "economic" reasons.
Why is California important?
California is a major part of the US economy.
The state is responsible for approximately 13% of the GDP (Gross Domestic Product) of the entire country.
If California were a nation on its own, then it would have the 8th to 10th largest economy in the world, depending on who you ask.
It will be almost impossible for the nation as a whole to start turning the ship around if California continues to remain in such dire straits.
California has had to deal with a raft of issues over the past couple of years - a slumping job market, a plummeting real estate market and major budget issues. The people of the state are likely feeling a bit punch-drunk, and will surely be glad when this crisis begins to abate.
According to Howard Roth, who is chief economist of California's finance department, California hasn't posted this high of an unemployment rate since January of 1941.
According to Roth, the highest ever rate on record in California is 14.7%, and that came in October of 1940.
The "official" record was set in March, however, with a rate of 11.2%.
The burning questions right now are:
1. How high will the unemployment rate in California rise before things finally start to improve?
2. Will the unemployment rate ultimately rise higher than 14.7%?
3. What is the U-6 unemployment rate in California right now?
4. How long will it be until the unemployment rate in the state drops back down to the 5-6% level?
Filed under: The Economic Meltdown