SAN DIEGO JOBLESS RATE DOWN TO 3%; LOWER THAN EARLY 2020
Big gains made in tourism, leisure and hospitality sectors
San Diego County’s jobless rate isn’t just back to pre-pandemic levels — it’s lower.
The county’s unemployment rate was 3 percent in April, the state Employment Development Department reported Friday. That’s lower than February 2020, when the 3.2 percent unemployment rate was held up as a sign of better days before much of the economy was shuttered to stop the spread of COVID-19.
San Diego’s improved job scene is a long time coming. In May 2020, the unemployment rate hit a pandemic high of 16.2 percent and all of California took much longer to recover than most of the nation because of stricter lockdown measures.
Tourism has been the biggest gainer in the last year, giving San Diego County one of the lowest unemployment rates in the state. The leisure and hospitality sector — with jobs in restaurants, hotels and casinos — added 4,300 jobs in a month,
and 42,600 year over year.
“This labor market is extraordinarily tight,” said Daniel Enemark, senior economist at San Diego Workforce Partnership. “For context, 2.9 percent is the lowest rate recorded this century, and our rate has reached that low in only three out of 268 months.”
Enemark said San Diego County’s unemployment rate was closer to 3.2 percent when adjusted for seasonal swings. That compares to 3.6 percent nationwide and 4.6 percent in California.
He said growth in the tourism sector is the best sign that the region is recovering from the pandemic, considering its rapid job gains came on the back of losing half its workforce in March 2020.
Labor force participation — adults who either have a job or are actively looking for one — was down in San Diego County from March to
April. The size of the labor force in April was 19,800 fewer people than it was the previous month. Experts have offered up a lot of reasons for the labor force shrinking — people retiring, people moving out of an expensive area and changing priorities during the pandemic — but it remains a topic that is still being actively researched.
It’s not just San Diego: The nationwide labor force declined by 363,000 workers in April. It was the biggest drop in the participation rate since September 2020.
Ray Major, chief economist at the San Diego Association of Governments, said a big factor is the phenomenon of early retirement happening nationwide, but there are also changing views of how people view work.
He said a good example is millennial couples who decide only one of them needs to work while the other watches the kids so they don’t spend money on child care. Major said people on the lower-income scale may also have more options to stay away from work temporarily after stimulus checks, high unemployment payouts and other benefits during the pandemic.
“There’s a big difference between how a millennial or Generation Z person looks at work vs. a baby boomer,” Major said. “A baby boomer looks at work as an obligation” and is more likely to stick in their current job.
He said many younger workers see the growth of mobile work as a reason they can leave and easily get a job wherever and whenever they feel like going back.
There are now 1.9 vacant jobs nationwide for every unemployed worker, said U.S. Bureau of Labor Statistics data analyzed by Reuters. It is slightly less in California at 1.28 vacant jobs per unemployed worker.
“Labor supply remains the biggest constraint to job growth in the state,” wrote Taner Osman, research manager at Beacon Economics and the Center for Economic Forecasting, in an analysis. “And as employers seek to ramp up employment during the seasonally strong summer months, worker scarcity will continue to place upward pressure on wages in the state.”
In addition to tourism, several San Diego County industries led the way in new jobs from March to April. Government jobs, which are mainly education, grew by 1,500; professional and business services (legal, scientific, waste management, architectural) added 1,300 jobs; construction added 1,200; and educational and health services (nursing, social assistance) added 900.
Several industries lost jobs. The biggest was the catch-all category of “other services,” which includes religious, maintenance and laundry work, which shed 800 jobs. Manufacturing and financial activities (real estate, insurance), both lost 200 jobs. Trade, transportation and utilities lost 100 jobs, which are mainly in retail.
On an annual basis, the biggest gainer was tourism with 42,600 new jobs. It was followed by professional and business services, up 19,800 jobs; government, up 9,400 jobs; trade, transportation and utilities, up 7,100 jobs; and other services, up 6,500 jobs.
Compared with other parts of California, San Diego County is about in the middle of the pack with a jobless rate of 3 percent. State labor officials do not seasonally adjust jobless rates for individual counties.
The rate was 4.7 percent in Los Angeles County, 2.7 percent in Orange County, 2.2 percent in San Francisco County, 5.8 percent in Monterey County, 2.1 percent in Santa Clara County, 4.5 percent in Santa Cruz County and 3.8 percent in Riverside County.