California, one of the largest economies in the world. A state which represents one-tenth of nation and the place where the rest of the country looks for emerging trends.
A visible growth in the employment rate can be seen from the recent data released by Bureau of Labour Statistics in April 2013. California’s unemployment rate of 9 percent is a drop from 9.4 percent in March. It surely is a delight to see a drop of about 1.7 percent compared to 10.7 percent in April 2012.
The BLS report said that, year-over-year there is a decline in the state’s jobless rate. With the construction industry is leading the hiring surge, about 7,400 jobs were added in April and 44,800 throughout 2012, indicating a renewed strength in the state housing market.
“This is definitely consistent with a pattern of economic recovery and that’s what is important,” said Loree Levy of the California Employment Development Department. “Over the year, our unemployment rate has come down by 1.7 percent so it’s definitely trending in the right direction” he continued.
The unemployment rate fell to the lowest in four years according to the state employment development report, but the cities in California are going bankrupt one after another due to collapsing housing prices, prolonged high unemployment rate. This is leading to a declining revenue affecting the economy.
Inland cities of California are the worse affected with high rate of unemployment and housing foreclosures — 14.1 percent in Stockton, 17.2 percent in Merced and a staggering 23.7 percent in El Centro. The Los Angeles metro area has unemployment rate of 9.9 percent.
“The cities of California are in extreme distress,” says Joel Kotkin, a professor of urban development at Chapman University in Orange, Calif., a frequent critic of California fiscal policies. “You’re going to have bankruptcies, It’s almost inevitable” he says.
Can Fracking Help Californian Cities Get Back On Its Feet?
California has been a source of crude oil since a long time. The discovery of Monterey Shale, the country’s largest oil shale. It stretches under a large part of Central California, but this oil can be harnessed only through hydraulic fracturing shortly known as fracking. Fracking is a petrochemical extraction technique.
Fracking has also been pushed to the forefront in California in recent years, following the release of a report suggesting that over 15 billion barrels of oil are contained in the Monterey Shale – a sedimentary rock formation resting under much of Central California that may be unlocked using fracking or other related techniques.
“There is a new interest in regulating fracking this [legislative] session because the people are demanding it,” explained Kristin Lynch, a director at the environmental organization Food and Water Watch. He also added, “You look at the sentiment of Californians about global warming and moving to renewable and you see how fracking is a hindrance to that.”
While this method of oil extraction has been accepted with arms wide open in other parts of the country like North Dakota. It has been extensively debated about in case of California and the environmental concerns associated with it.
California is blessed with a huge oil reserve and yet is unable to harness it. Being considerate toward the environment might seem to be taking this state to a cliff’s edge. With a steady decline in unemployment rates, job market seems to have gotten better but serious measures are required to help the cities heading towards bankruptcy.