Job Loss In Silicon Valley Worst Since 2010, Employers Slashing Jobs
For the second straight month, the San Francisco Bay Area lost thousands of jobs in September, making it the worst month for employment locally since February 2010.
The setback for the local economy comes as the crucial holiday shopping and hiring season draws near, and contrasts with a strong hiring picture statewide.
The Bay Area’s job losses stem from two distinct phenomena: Some employers are slashing positions, and others are unable to hire. Some economists attribute this second problem to skyrocketing housing costs. The lack of affordable places for workers to live appears to have hobbled the region’s ability to fill jobs as briskly as in prior years.
From East Bay Times. Story by George Avalos
“Housing is the chain on the dog that is chasing a squirrel,” said Christopher Thornberg, principal economist and founding partner with Beacon Economics. “Once that chain runs out, it yanks the dog back.”
Overall, the Bay Area lost 4,700 jobs last month. While some smaller metropolitan areas in the region had job gains, employers shed 1,300 jobs in Santa Clara County, 1,700 in the San Francisco-San Mateo region and 2,600 in the East Bay, seasonally adjusted figures from the state’s Employment Development Department show.
The September losses, combined with 2,400 job losses reported by the EDD for August, paint an unsettling picture and lend credence to the assessment from a growing number of experts that the Bay Area’s job growth has begun to slow dramatically.
The slowdown is real,” said Stephen Levy, director of the Palo Alto-based Center for Continuing Study of the California Economy. “There were times this year we thought that job losses here and there were just temporary. But the slowdown is a fact. It’s happening.”
The lack of housing also makes it tough for employees to live near their workplaces, forcing many into lengthy commutes on roads choked with traffic. Some prospective employees decide they’d rather not bother.
“The economy in the Bay Area has pushed up against the physical limits of a lack of housing and a lack of places for workers to live,” said Jeffrey Michael, director of the Stockton-based Center for Business and Policy Research at University of the Pacific.
Over the 12 months that ended in September, the Bay Area added 50,400 jobs, a 1.3 percent increase in total payroll jobs during the one-year period.
By comparison, that’s less than half the growth of 2016. Bay Area job growth was 2.9 percent in 2016, 3.7 percent in 2015, 3.4 percent in 2014 and 3.5 percent in 2013, this news organization’s analysis of the EDD figures shows.
Despite the Bay Area’s increasingly sluggish picture, experts said Friday that the region doesn’t seem to be headed into a protracted downturn or outright contraction.
“It’s a dynamic economy in the Bay Area; it is fueled by a strong technology industry,” Michael said. “While growth has definitely gotten choppy, a consistent pattern of job losses will not emerge in the Bay Area.”
“Growing up in Silicon Valley, I never pictured this for myself,” said Steve Satariano, a San Jose resident and experienced worker in the information technology sector. “I always thought that if I went into the tech industry, I could create a prosperous future for myself. But who wants to commute six hours a day? You should be able to afford a place to live near where you have to work.”
Read more at East Bay Times.