South Bay keeps driving job market

Bay Area produces a fourth of California’s employment gains in July

The South Bay job market charged ahead during July, leading the Bay Area and accounting for a jaw-dropping one-fourth of all the jobs that California added last month, a new state government report released Friday showed.

To underscore the strength of the entire Bay Area economy, over the one-year period that ended in July, the nine-county region has added slightly more than 100,000 jobs — one-third of the jobs that the entire state of California has gained during the same 12 months.

“We are pretty much staying the course with the strong job market in the Bay Area,” said Robert Kleinhenz, an economist and executive director of research with Beacon Economics.

Santa Clara County added 4,900 jobs in July, while other metro centers in the Bay Area were feeble by comparison.

The East Bay gained 100 jobs, and the San Francisco-San Mateo region added just 300, according to seasonally adjusted figures from the state’s Employment Development Department.

All told, the Bay Area gained 4,900 jobs, as the other urban centers in the nine-county region posted weak gains or suffered employment losses during July.

Sonoma County was the weakest metro center in the area with a loss of 900 jobs, while Solano County lost 100 positions. All the numbers were adjusted for seasonal variations.

“Things really look good on the demand side, with employers still needing to hire workers,” said Stephen Levy, director of the Palo Alto-based Center for Continuing Study of the California Economy. “The key is whether we can get those workers to their jobs from places where they can afford to live.”

California added 19,600 jobs during July, which means Santa Clara County and the Bay Area produced exactly one-fourth of

all the job gains statewide last month.

“It consistently seems that the Bay Area is accounting for a huge amount of California’s job growth,” said Mark Vitner, a senior economist with San Francisco-based Wells Fargo Bank.

The statewide unemployment rate improved to 4.1% during July. That 4.1 jobless rate matches the all-time lowest unemployment level on record for the Golden State, measured by a data set that stretches back to the 1970s. California achieved the 4.1% milestone for six straight months during 2018.

California’s job market achieved another benchmark for the month. Total jobs, as measured by nonfarm payrolls, have now grown for 113 consecutive months, which ties the record, set in the 1960s, for a consecutive stretch of employment gains, according to the EDD report.

Nevertheless, for at least the last year, the Bay Area has become the primary assembly line for job creation in California.

Over the 12 months that ended in July, California added 311,800 jobs, while the Bay Area gained 103,000 positions. This means that even though the Bay Area has just onefifth of California’s population, the nine-county region has accounted for a stunning one-third of the employment gains in the entire state during the most recent one-year period.

“We have terrific job growth numbers in the Bay Area,” said Lenny Mendonca, Gov. Gavin Newsom’s chief economic and business adviser. “But we want the job growth in the state to be spread out a little more geographically and to expand it beyond the concentration of jobs that require technical skills.”

The tech industry muscled up for a robust month of July, according to an analysis of the EDD’s statistics compiled by Beacon Economics and UC Riverside.

High-tech companies added 2,000 jobs in the San Francisco-San Mateo region and another 1,000 in Santa Clara County, the Beacon and UC Riverside assessment determined.

To go along with the strength in tech, the South Bay added 900 hotel and restaurant jobs and gained 800 administrative support and clerical positions.

The East Bay’s strongest industry in July was health care, which added 1,500 jobs.

But construction was staggered by considerable job losses. The San Francisco-San Mateo region shed 1,400 construction jobs last month, and the East Bay lost 1,200 construction jobs, the Beacon and UC Riverside analysis determined.

Outside factors appear to be the worst hazards that the Bay Area economy must navigate, experts cautioned.

“Most of the risks for the job market in the Bay Area come from the worldwide economic slowdown and the trade problems with China,” Vitner said.

The robust tech sector still seems poised to provide more fuel for the Bay Area’s economic engine, experts believe.

“Tech companies are still expanding,” Levy said.

Google, in particular, has prepared multiple springboards to catapult the search giant to dramatic expansions in Mountain View, Sunnyvale, north San Jose and downtown San Jose.

The result of all that could well equate to continued hiring at a brisk pace.

“There is no shortage of demand from tech companies,” Levy said. “They still want to expand in the Bay Area.”