From Newsmax:

California's unemployment rate jumped nearly half a percentage point in one month to a record 11.5 percent in May, and Governor Arnold Schwarzenegger Friday warned the economy would not recover quickly.

Led by a drop in government jobs -- a reflection of the state slashing its own payroll to try to cope with a mounting budget gap and the possibility it will run out of cash, the May rate was nearly 2 percentage points ahead of the national 9.4 percent rate, the California Employment Development Department reported.

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More on distressed California:

An excellent article on why California is failing

California disaster continues: Unemployment rate climbs to three-decade high

California bureaucrats debate blueberry commission as state enters meltdown stage