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Statement of Need <br />California is only in the beginning stages of a painfully slow recovery in job levels. The feeling of <br />many economists is that it may take another 1 to 2 years before residents feel more optimistic about <br />economic conditions and perhaps not until the middle of the decade that employment and <br />unemployment will near their pre- recession levels. The State's unemployment rate will remain in <br />double digits until early 2013 according to the UCLA Anderson School of Management in a recent report. <br />According to UCLA, "That's three months later than the university's economists forecast in December <br />[2010], as California's weak housing market continues to weigh on the region's recovery." <br />Except for San Luis Obispo County, each of the local workforce investment areas involved in this <br />project serves or is located in a U.S. Department of Labor - designated Labor Surplus Area (FY 2011 Labor <br />Surplus Area List). The reference period used in preparing the Labor Surplus Area (LSA) List was January <br />2008 through December 2009. The national average unemployment rate (including Puerto Rico) during <br />this period was rounded to 7.6 percent. The qualifying rate for a LSA classification is 20 percent above <br />the national average unemployment rate. For FY 2011 the qualifying rate is 9.1 percent. <br />According to the California EDD Labor Market Information Division (LMID), California's seasonally <br />adjusted unemployment rate was 12.5% in December 2010 (see graph above), which was a mere 0.1 <br />percentage point below the record high rate of 12.6% that was set in March 2010. Although the <br />December 2010 rate was up just two tenths of a percentage point (0.2) from one year earlier, it was 7.7 <br />percentage points higher than its pre- recession low of 4.8% in December 2006. In comparison, the U.S. <br />3 <br />Four -Year Trend in California and U.S- Unemployment Rates <br />December 2010; Seasonally Adjusted Data <br />California <br />�1J_�. <br />12.3 _. <br />12.5 <br />12 <br />-.... _ <br />10 <br />I � I 9.2 <br />i <br />9 <br />9.4 <br />e <br />7 <br />5.8 .... _ <br />i <br />6 <br />7.3 I <br />! <br />4-8 <br />5 <br />q_ <br />.._ .... 5.O .- .._... l <br />. -.. <br />4.4 <br />3 <br />,,, r <br />r— 00 00 00 o� <br />rn rn o <br />0 <br />0 <br />0 0 <br />0 0 0 0 0 0 <br />0 0 <br />o ¢ <br />¢ D ¢ ¢ o ¢ <br />¢ o ¢ <br />¢ <br />D <br />Except for San Luis Obispo County, each of the local workforce investment areas involved in this <br />project serves or is located in a U.S. Department of Labor - designated Labor Surplus Area (FY 2011 Labor <br />Surplus Area List). The reference period used in preparing the Labor Surplus Area (LSA) List was January <br />2008 through December 2009. The national average unemployment rate (including Puerto Rico) during <br />this period was rounded to 7.6 percent. The qualifying rate for a LSA classification is 20 percent above <br />the national average unemployment rate. For FY 2011 the qualifying rate is 9.1 percent. <br />According to the California EDD Labor Market Information Division (LMID), California's seasonally <br />adjusted unemployment rate was 12.5% in December 2010 (see graph above), which was a mere 0.1 <br />percentage point below the record high rate of 12.6% that was set in March 2010. Although the <br />December 2010 rate was up just two tenths of a percentage point (0.2) from one year earlier, it was 7.7 <br />percentage points higher than its pre- recession low of 4.8% in December 2006. In comparison, the U.S. <br />3 <br />