EMPLOYMENT EFFECTS OF THE CIVIL UNREST

One of the objectives of EDD's employer survey was to gather data that would help assess the effects on employment caused by the destruction of businesses during the unrest. Prior to the survey, a preliminary attempt was made to estimate the number of jobs lost from the civil unrest by matching UI employer records with damaged-site addresses. Because of address deficiencies, the match was only partially successful. Data gathered in the survey, although limited by a low response rate from businesses at damaged sites, were used with other data sources to estimate the effect on employment.

EDD has estimated that the potential long-term jobs lost as a direct result of the civil unrest totaled 11,500, and that these jobs would have normally generated an annual payroll of about $240 million.

1. The method used to calculate the jobs and wages lost was as follows:
   
   
2. An employer worksite-address file was constructed from EDD employer records and from a recent survey that verified worksite addresses of firms in Los Angeles County. These data sources provided employment and wages paid, by address.
   
   
3. Additional employers that were not in the UI-tax reporting system were identified through other sources, including the Los Angeles City Clerk business license file, and the Disaster Unemployment Assistance program (see Civil Unrest Employer Survey ).
   
   
4. The resulting list of employers was matched with a list of addresses of severely damaged or destroyed buildings (see Profile of Residents in the Civil Unrest Area ). This match produced a list of employers located at the damaged sites.
   
   
5. For non-UI-covered employers that were identified, an employment estimate was obtained either directly from the EDD employer survey or from an estimate derived from survey responses from similar types of firms.
   
   
6. The estimate of lost wages for employers in the UI-tax system was extracted from quarterly tax reports. For employers not in this system, wages were estimated based on the number of employees working at the worksite and by applying the average wages paid by similar-sized firms within the UI-tax system to the non-UI establishments.
   
   
7. In making the job-loss projection, it was assumed that employment and wages at UI-covered firms immediately preceding the civil unrest were the same as in prior periods covered by the UI-tax returns. It was also assumed that any employer identified as being located in a building that was rendered unusable during the unrest was not likely to be back in business for a considerable period of time, if at all.
   
   The total estimated long-term job loss is probably a conservative figure. Apart from the inherent difficulty of making matches of street addresses by computer, the method used very likely missed a number of small family-owned businesses which would not have been identified by the UI-tax system, or through other sources.
   
   
   
   The Los Angeles Job Losses in Perspective
   
   The loss of life, the physical destruction, and the social disruption that resulted from the Los Angeles civil unrest were of unprecedented proportions. The matter of lost jobs and income, though not as dramatic as the more immediate effects of the unrest, also have had a serious effect on the residents of Los Angeles County, and in particular on the residents of the affected areas. However, this employment loss, serious and traumatic as ft was, occurred at the end of a twelve-month period during which an estimated 108,000 jobs disappeared from the county's labor market. Moreover, if countywide employment had continued to grow during the 1987-92 period at the same rate as it did between 1977 and 1987, employment in the county would have been 496,000 greater than it actually was in April 1992.
   
   According to the 1990 Census, White males in Los Angeles County had an unemployment rate of 6.1 percent and a civilian labor force participation rate of 77.5 percent. For all persons in the labor force to have experienced that same unemployment rate, and for all males to have participated in the labor force at the same rates as did White males, would have required 180,800 additional jobs at the time of the same census. For the 10 high percentage minority communities cited in this study (see Table 1), that number would have been about 60,000 jobs.
   
   Another way of assessing the 1990 labor force experience of workers in Los Angeles County would be to apply certain national labor force rates that existed in 1969--the year marking the lowest jobless rate since the Korean War-to 1990 census data for the county. If the following 1969 conditions had held in 1990:
   
   a) 75.7 percent of all civilian males 16 years and over participating in the labor force, and
   
   b) unemployment rates of 4.7 percent for women and 2.8 percent for men,
   
   then a total of 350,200 additional persons would have been working in Los Angeles County, or 8.3 percent more than the total reported in the 1990 Census.
   
   

   

   Analysis of the 1992 Los Angeles Civil Unrest

   

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