Santa Clara County leads job losses as unemployment rate rises
Silicon Valley’s unemployment rate edged up in June, signaling that the region still has some way to go before returning to pre-pandemic levels.
Regional unemployment rate fell from 4.6% to 5.1% between mid-May and mid-June, according to published study this month through Silicon Valley Joint Venture, a non-profit organization that analyzes the economy and quality of life in South Bay. The analysis examined data from a July 16 report from the California Department of Employment Development.
The increase is “significantly driven” by job losses in Santa Clara County, according to Rachel Massaro, research director at Joint Venture Silicon Valley. Between May and June, the county lost 1,400 jobs and gained 4,400 unemployed people. Neighboring counties of San Mateo and San Francisco gained more than 4,000 and 5,000 jobs, respectively.
“This is the first month since the pandemic that we are seeing this contrast,” Massaro told the San José Spotlight, adding that the state’s data is limited, so it is not immediately clear what caused the losses. jobs in the county. “It’s hard to determine why, but I hope we can see it more clearly in the months to come. “
Silicon Valley, defined in the analysis as the combination of Santa Clara and San Mateo counties, is slowly recovering from record 11.6% job losses in April 2020 at the start of the pandemic.
As of mid-June, about 73,100 Silicon Valley workers were still unemployed. That’s almost double the number of unemployed reported in March 2020 – 42,900 – according to the analysis.
The region’s recovery is advancing at a faster pace than the state and the country, which have unemployment rates of 8% and 6.1%, respectively. But it will be time before Silicon Valley returns to the pre-pandemic 2.1% unemployment rate of February 2020, Massaro said.
Across the Bay Area, which also includes San Francisco and San Benito counties, education has seen the most job losses compared to other industries. In total, the region lost 3,200 public school jobs and 1,400 university or college jobs, according to the analysis.
“The loss of unemployment in education at the end of a school year is not surprising,” Massaro said. “But it’s a significant amount.”
California also saw a similar increase in its unemployment rate, according to the analysis. The state saw a drop of more than 42,000 jobs and an increase of nearly 100,000 unemployed between May and June, resulting in an unemployment rate of 8%.
Silicon Valley businesses in the entertainment and hospitality industry, such as hotels, restaurants, movie theaters, and spectacle sports, posted gains. These types of businesses added nearly 8,000 jobs between May and June, a 25% increase from last year, according to the analysis.
Yet this is 30% lower than the industry’s employment rate before the pandemic.
Scott Knies, Executive Director of the San José Downtown Association, said the unemployment rate reflects what he sees in the city.
“The loan (Paycheck Protection Program) was essential in helping businesses retain their employees, but not all,” Knies said. “I hope that with the return of tourism and events, we will see (the workers) come back as well.”
Hotels and food services also saw a 9% month-over-month increase in employment, but this is still 46% lower than it was in February 2020.
Owners of downtown restaurants recently told the San José Spotlight they were struggling to find new workers amid COVID-19 fears – a phenomenon which is prevalent throughout the country.
Massaro said she couldn’t tell if this was the case in Silicon Valley.
“Either way, we still have a long way to go,” she said.