By Holly Quan

SACRAMENTO (CBS/AP) – The unemployment rate in California fell again in May, dropping to 11.7 percent, a state agency reported Friday, but the number of jobs in the state was also down.

It was the fifth month in a row with a lower jobless rate, even though a survey of 42,000 California businesses showed the state lost about 29,000 payroll jobs during May.

KCBS’ Holly Quan Reports:

People who are not seeking work aren’t counted in the labor force, so the jobless rate can go down even with fewer jobs. Weak and spotty job growth has been common during the economic recovery from the recent recession, and some people have stopped looking for work or have gone back to school, which can lower the calculated unemployment rate.

A federal survey of about 5,500 California households estimated that there were roughly 2,117,000 people unemployed in the state in May. That’s down by 24,000 from April and by 134,000 from May 2010.

The state unemployment rate in April dipped below 12 percent for the first time since 2009. Officials originally estimated the April figure at 11.9 percent but dropped it to 11.8 percent after additional study. The jobless rate in May 2010 was 12.4 percent.

Economists tend to give more weight to the job numbers, which are more statistically reliable. Payroll employment in California was estimated at 14,031,700 in May, down by 29,200 from April. The losses hit most industries in the state, especially professional and business services and construction. The bright spots were in financial services and information.

The state gained a tepid 87,500 payroll jobs in a year, up just 0.6 percent.

“It was disappointing,” said Howard Roth, chief economist for the California Department of Finance. Late spring storms and flooding around the United States may have depressed economic growth in California as well as the areas that were directly affected, he said. “Those parts of the nation buy stuff that we make.”

The United States as a whole added just 54,000 payroll jobs during the month, and U.S. unemployment ticked up to 9.1 percent.

(Copyright 2011 by CBSSan Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. Wire services may have contributed to this report.)

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