"The biggest hits we're seeing now are actually in retail trade, consumer-related industries. I think what we're seeing is evidence of consumers really tightening their belts," said Loree Levy, Calif. Employment Development Dept.
And that's bad news for the 1.4 million Californians crowding unemployment offices looking for work.
After his non-profit's funding was cut this summer, mental-health counselor Nicholas Losito was hoping a holiday job was going to tide him over.
"I even got desperate and made an application to Costco too. But I don't know if I'll ever hear from them," Nicholas Losito, who is unemployed.
Retailers are usually gearing up for the big holiday shopping season about now, but sales projections show people will be pinching pennies during this rocky economy.
"Retailers are going to lower their expectations for Christmas sales and therefore will not be hiring as many temporary workers as they might have otherwise," said Bill Hauck, Calif. Business Roundtable.
Optimists say the jobless rate remaining steady for two straight months is good news.
The new unemployment data, though, do not reflect this month's global financial crisis. Many experts are predicting the jobless rate will actually be higher for October.
David Walker is the former U.S. Comptroller General who kept his eye on the economy for the feds the past 10 years.
He doesn't like the unemployment numbers he's seeing.
"I would expect for them to go up somewhat more. I think we are in a recession," said David Walker, former U.S. Comptroller General.
Though the "R" word is not official, California's unemployment rate climbed to nearly 10 percent during the early 1990s recession.