testosteronepit.com / Wolf Richter / SATURDAY, DECEMBER 28, 2013 AT 12:19AM
If you come to San Francisco or Silicon Valley and look around, you’d arrive at the conclusion that California is booming, that companies jump through hoops to hire people, that they douse them with money, stock options, and free lunches. You’d see engineers spend lavishly and drive up rents and home prices to where landlords react with record evictions of the less-lucky. You’d see Google buses bring in people and trigger mini-demonstrations. You’d see entire layers of long-time residents getting pushed out because it has just gotten too expensive. In San Francisco, you’d see throngs of tourists from China and other places, spending money hand over fist. And there are a few other pockets in California where money is no objective.
But in the rest of the state, the picture isn’t that rosy. Total unemployment, officially, is still 8.5%, though that’s far better than the hellish 12.4% in February 2010. Of those unemployed, 28% have been jobless for over a year. Those receiving unemployment benefits – a fraction of the total unemployed – have dropped from 1.5 million to 712,000, whether they found jobs or just fell off the list. But, as the LA Times reported, there are still 400,000 fewer jobs in the state than there were before the crisis. So finding a job, if you aren’t into software, consumer tracking, or life sciences, is tough.
The unemployment debacle has been expensive. Employers pay payroll-based unemployment insurance into a fund that then covers the 26 weeks of unemployment benefits that the state pays. But during the crisis, unemployment skyrocketed, and by January 2009, California’s unemployment system became one of the first in the nation to go broke.