S.D UNEMPLOYMENT STAYED HIGH IN JAN.

Jobless claims elevated to start the year with strict closures in place

San Diego County entered 2021 with an 8.1 percent unemployment rate, substantially higher than a year before when it was 3.4 percent.

January’s jobless rate, reported by state labor officials Friday, is a reminder of the large increase in COVID-19 cases at that time and stricter shutdown measures put in place across the state. Virus cases are now dropping and vaccine rates are increasing, but the start of the year was less hopeful.

As of January, San Diego County had lost 154,200 jobs in a year. The 8.1 percent rate was slightly above the revised 8 percent rate in December, but lower than the peak of 15.2 percent in May.

In November, the region hit its lowest level of the pandemic — 6.6 percent.

While COVID-19 restrictions were loosened over time, California reinstated much of them in December. Restaurants, bars, gyms and movie theaters to outdoor-only and retail capacity was reduced. San Diego County is now expected soon to enter the state’s less restrictive red tier, out of its most prohibitive purple tier.

“Unfortunately, December’s and January’s job losses have returned employment levels in the state to where they were in September 2020,” wrote Taner Osman, a research manager at Beacon Economics. “But even though this damage cannot be repaired overnight, the outlook for 2021 is much more positive.”

Job losses statewide mirrored San Diego’s numbers. California had a seasonally adjusted unemployment rate of 9 percent in January, close to the 9.3 percent rate in December.

The nationwide unemployment

rate in January was lower than California at 6.3 percent. However, it should be noted California was a virus hotspot during that time, with San Diego County hitting its highest daily hospitalization level of the entire pandemic on Jan. 12.

Tourism was the hardest hit industry in San Diego County — making up half of all lost jobs. The 77,100 positions lost were in hotels, casinos and restaurants. While there is hope the industry can rebound following aggressive vaccine efforts, the region’s biggest tourism event for this summer has already been canceled. ComicCon International announced in early March it was canceling its July event for a second year.

The all-encompassing “other services” category lost 16,600 jobs. Positions in the sector include repair and maintenance, laundry services and grant writing. Government job losses, mainly in

education, were at 16,000. The trade, transportation and utilities sector, featuring all retail jobs, lost 12,100 jobs.

All sectors lost positions year-over-year. Construction, declared an essential service early in the pandemic, lost the least at 1,400 jobs.

Lynn Reaser, chief economist for the Fermanian Business & Economic Institute at Point Loma Nazarene University, said the unemployment rate was closer to 8 percent when adjusted for seasonal swings.

“A powerful combination of widespread vaccination, government spending, support from the Federal Reserve, easing of lockdown restrictions, and pent-up demand should fuel a vigorous expansion beginning in the spring and accelerating through year-end,” she said.

From December to January, job losses were mainly in tourism, down by 12,200 jobs, and retail, down by 8,900 jobs. Regardless of the virus, both categories typically experience drops in January following the holiday season.

State labor officials do not seasonally adjust jobless rates for individual counties, but the unadjusted numbers show San Diego County had one of the lowest unemployment rates in Southern California in January at 8.1 percent.

The rate was 12.7 percent in Los Angeles County, 7.4 percent in Orange County, 8.6 percent in San Bernardino County and 8.6 percent in Riverside County.

An analysis of January’s jobless claims by Beacon Economics and UC Riverside’s business school found the Los Angeles metro area had lost the most jobs annually at 12.1 percent.

It was followed by Orange County, down 11.7 percent; San Diego, down 10.2 percent; El Centro, down 9.9 percent; and the Inland Empire, down 6.3 percent.