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San Diego adds 19,500 jobs in 2012

Jobless rate dips to 8.1% in December

San Diego County added 19,500 jobs in 2012, experiencing growth in every industry except manufacturing, according to data released Friday by the state Employment Development Department.

The job growth helped drive the jobless rate down nearly a full percentage point, dropping from 9.0 percent in December 2011 to 8.1 percent last month.

"The year-to-year increase in jobs was very significant, especially since it was so broad-based," said Lynn Reaser, chief economist with Point Loma Nazarene University's Fermanian Business & Economic Institute.

Reaser predicted that job growth would pick up this year, estimating that 25,000 more jobs will be added by year-end.

But despite nearly two full years of job growth, the county has only recovered half the jobs it lost during the Great Recession. It would have to add 52,500 jobs -- two-and-a-half more years of growth at the current rate -- to return to its all-time high of 1.3 million workers in July 2006.

And economists warn that because so many local jobs are tied directly or indirectly to federal contracting, job growth could slow this year if Congress takes too long to resolve its disputes over the federal debt ceiling and the "fiscal cliff."

The biggest swings in county employment last year were:

Retail: up 5,200 jobs, or 3.7 percent. All major retail segments expanded, including home and garden supplies, which added 500 jobs, partly reflecting more movement in the housing market. Kelly Cunningham, economist with National University System Institute for Policy Research, notes that retail sales in the county rose an estimated 7.6 percent last year, or 4.3 percent after adjusting for inflation. But he predicts sales will rise only 4.7 percent this year, or a minuscule 1.1 percent, after factoring in a projected rise in the inflation rate.

Hotels, bars and eateries: up 2,500 jobs, or 1.6 percent. Thanks partly to a revival in tourism, most segments of the hospitality industry rose last year, including hotels, which added 800 jobs, and dining places and bars, which added 1,700. But the numbers suggest that consumers might be trying to save money by cutting back on sit-down restaurants in favor of fast-food joints. Full-service restaurants last year shed 1,900 jobs in a 3.6 percent decline.

Manufacturing: down 2,000 jobs, or 2.2 percent. Job growth in San Diego County last year varied from industry to industry. There was zero growth in aerospace -- partly because of government contractors waiting to see how the Pentagon budget would look, and a 400-job uptick in shipbuilding. The biggest declines were concentrated in computers and electronics, which shed 600 jobs, and nondurable goods, including things like food-processing and textiles, which cut 600 workers.

Health care: up 1,700 jobs, or 3 percent. Health care was one of the most reliable employers throughout the recession and it is projected to keep adding jobs this year.

Real estate, mortgage and banking: up 1,600 jobs, or 3.9 percent. After taking a hard hit when the housing bubble burst, the financial sector showed signs of revival in 2012, with 800 jobs added in mortgage and lending services and 800 in real estate. The job growth reflects growing optimism about the housing market, with a 4 percent rise in the number of sales and a 14 percent jump in the total value of those sales. But finance and real estate operations are still 10,000 workers below their previous peaks.

Construction: up 1,600 jobs, or 2.9 percent. After losing more than 40 percent of their workers during the Great Recession, construction companies have been slowly rebuilding over the past two years. Cunningham projects that hiring will continue through 2013, partly because of a projected 13 percent rise in home construction, compared to 7 percent growth in 2012. But to get back to its June 2005 all-time high, construction firms would need to add 37,600 workers.

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