California's unemployment rate rose by a whopping half a percentage point last month, reaching 6.2 percent as a slowing economy shed more jobs especially in the construction and financial services sectors, the state's Economic Development Department reported Friday.
March's unemployment was the highest since July 2004, when the rate was also 6.2 percent, and up 1.2 percent from a year ago, with 229,000 more people looking for work, according to the department.
Economists blamed the steady rise in joblessness in the state on deterioration of the crucial housing market, saying that more people losing their jobs means more bad news ahead for state and local government budgets.
"This is a huge increase. The (housing) bubble has a slow leak, so it's hard to tell how long it will take" to fully deflate, said Howard Roth, chief economist for the state Department of Finance.
Governor Arnold Schwarzenegger and state lawmakers next month would grapple with plunging tax revenue and a projected over 8 billion-dollar budget deficit as they prepare the state's spending plan for the fiscal year beginning July 1.
California's unemployment rate is the third highest in the United States, trailing Michigan with 7.2 percent and Alaska with 6.7 percent.
According to Stephen Levy, director and chief economist of the Center for the Continuing Study of the California Economy, the state's job market is doing worse than these in Pennsylvania and Ohio, the two Rust Belt states that have figured prominently in the presidential primary elections because of their lost manufacturing jobs.
Researchers at a California university said last month that California's economy, the largest in the United States, was probably already in a recession while the rest of the country may still avoid one.
Source: Xinhua
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