The Bay Area added jobs during September, but the once-robust region’s battle to regain the mammoth amount of jobs it lost amid coronavirus-linked business shutdowns has fizzled, a new report released Friday shows.
While employers added 18,900 jobs in the Bay Area, September’s gains were far below the prior month and just a puny fraction of the record-setting 109,000 jobs reported in June, the state Employment Development Department reported.
“The Bay Area labor market, one of the hottest in the country and in the State of California, has done a 180-degree U-turn in the wrong direction since the pandemic shutdowns started to lift in May,” said Scott Anderson, chief economist with Bank of the West.
To intensify the economic angst: The gap between the Bay Area and California is significant when it comes to the speed of regaining jobs. The Bay Area has recovered just one-third of the jobs it lost during March and April, while California has recaptured nearly 40%.
“The Bay Area has been particularly cautious in reopening,” said Patrick Kallerman, research director with the Bay Area Council Economic Institute. “That is good for keeping the coronavirus down, but that’s bad for restarting the economy.”
Santa Clara County was by far the best-performing metro center in the Bay Area last month, adding 9,000 jobs, according to the EDD report. The San Francisco-San Mateo region gained 5,400 jobs, and the East Bay added 4,300 positions.
“We are definitely in the slower phase of the recovery now,” said Jeffrey Michael, director of the Stockton-based Center for Business and Policy Research.
Overall, California added 96,000 jobs in September, and the statewide unemployment rate improved slightly to 11% in September, down from 11.2% in August. Like the Bay Area, the state’s employment gains in September were far below the 113,800 jobs added back during August. However, the Bay Area’s current unemployment rates are still better than the state’s. Santa Clara County’s unemployment rate was 7.4%, San Francisco-San Mateo was 8.2%, and the East Bay was 9.8%.
The Bay Area has now recovered 33% of the 619,500 jobs that it lost during March and April. That’s well behind the statewide recovery pace of 38%. California lost a massive 2.62 million jobs in March and April, this news organization’s analysis of the EDD statistics for 2020 shows.
Santa Clara County, though, is outpacing the Bay Area and the state. The South Bay has regained 39% of the 150,600 jobs it lost in the first two months of the pandemic.
Michael Bernick, an employment attorney with law firm Duane Morris, noted that county health officers in the Bay Area imposed earlier and stricter economic lockdowns than was the case elsewhere in the state.
“These decisions received a lot of applause in the media at the time they were made,” Bernick said. “Now we’re seeing some of the tradeoffs.”
Plus, big tech companies, while not laying off workers in the brutally high numbers seen in other industries, still have employees operating from home. And that’s hurt merchants near Silicon Valley’s mega campuses.
“With more people working remotely, there has been less business at restaurants, bars and coffee shops,” said Mark Vitner, senior economist with Wells Fargo Bank.
This season’s recent destructive wildfires also might have undermined the Bay Area economy. Sonoma County lost 600 jobs, and Napa County employers shed 200 positions in September.
Beacon Economic and UC Riverside provided this news organization with an analysis of how Bay Area industries fared in September:
— In Santa Clara County, tech added 3,700 positions, health care was up 1,700 jobs, and hotels and restaurants added 1,700.
— In San Francisco-San Mateo, tech gained 2,400 jobs, construction was up 1,200, and retail added 1,100 but at the same time reported the loss of 2,400 other positions in the sector.
— In the East Bay, retail gained 2,100 jobs.
The pace of job gains could potentially speed up as state and local government officials gradually wrench open the economic spigots, said Stephen Levy, director of the Palo Alto-based Center for Continuing Study of the California Economy.
“The Bay Area was hit harder by the pandemic than the state or nation as we imposed the toughest health-based restrictions,” Levy said. “The region led by Silicon Valley is adding jobs now and should show larger gains soon” as more businesses are able to reopen as restrictions ease.
Still, at the current pace, the Bay Area and California won’t recover their lost jobs for about a year and a half — or longer.
“If we keep adding jobs at September’s rate, the state will not return to February’s level of employment until sometime in 2022, sobering news for those who have lost work since the outbreak of the pandemic,” said Taner Osman, research manager at Beacon Economics.
