Despite the fact that California's economy created net new jobs In March, the unemployment rate continued to rise. That's because those who had completely lost hope and dropped out of the unemployment figures (they weren't actively looking for work), are now coming back to sniff around for jobs.

L.A. Times:

Despite hints of an economic turnaround, some of the 2.3 million unemployed in the state found March the toughest month yet. That's because tens of thousands have been out of work so long that their unemployment checks will be cut off within the next few weeks. They're not helped by the $18-billion measure signed Thursday by President Obama that extends jobless benefits for many Americans through June 2.

The Employment Development Department estimates that about 100,000 Californians will have exhausted their benefits by this weekend.

"Jobs have not been quickly multiplying, so there's a lot of people who are still in need of assistance," said Loree Levy, a spokeswoman with the Employment Development Department.

California payrolls increased by 4,200 nonfarm jobs in March, primarily in the sectors of manufacturing, educational and health services, and leisure and hospitality. Still, the unemployment rate rose as many who had been discouraged by the job hunt resumed their search.

This is why if we talk about unemployment in the strict sense of the government figures (which are perversely affected by people either giving up their job search or starting to look around), unemployment will take a long time to come down. Not only must news jobs created for those still looking for work, but new jobs must also be created for all the people who dropped out of the labor force entirely yet would come back if they saw hope again.