Slower Job Growth in March and Some Good News in the Report
February 19, 2022
The Bay Area added 13,100 payroll jobs in March down from 22,100 in February but is still outpacing the nation in job growth over the past 12 months after the sharp job losses in 2020.
The highlights:
• Bay Area jobs increased by 6.2% between March 2021 and 2022 compared to a 4.5% increase in the nation and 6.4% gain in California.
• The Bay Area unemployment rate in March 2022 was 2.9% compared to 2.7% in the pre-pandemic low.
• More workers returned to the workforce in March and non-traditional job growth continues to outpace payroll job growth drawing workers back to the labor force and pushing unemployment levels down.
• April 2022 brings major crosscurrents to the global, national and regional economy with the Russian invasion of Ukraine, rising interest rates amidst continuing high inflation and the ongoing Bay Area challenges of housing, transportation and competitiveness.
• Bay Area jurisdictions have been given large increases in their housing goals for the next eight years as a result of state legislation and policy to reduce overcrowding and increase affordability. Each jurisdiction is in the process of updating their Housing Elements in 2022 to meet state and regional policy goals and requirements.
The Bay Area Outpaced the Nation in Recent Job Growth
Bay Area payroll jobs increased by 6.2% between March 2021 and March 2022 outpacing the U.S. 4.5% growth rate. The region still lags the nation and state in the % of jobs recovered since April 2020 as a result of the large job losses in 2020.
By March 2022 the region had recovered 77.8% of the jobs lost between February and April 2020. This is a lower recovery rate than the state and nation, though the region has closed the gap in recent months.
The Bay Area added 231,600 jobs in the past year led by a gain of 93,000 in the San Francisco metro area though SF has recovered just 73.8% of the jobs lost between February and April 2020. The San Jose metro area added 59,200 jobs and by March 2022 had recovered 82.4% of the jobs lost between February and April 2020. The Oakland metro area added 55,300 jobs.
By March 2022 the region had recovered 77.8% of the jobs lost between February and April 2020. This is a lower recovery rate than the state and nation, though the region has closed the gap in recent months.
Unemployment Rates Fell to 2.9% in the Region in March 2022 from 6.5% in March 2021.
The lowest rates were in the San Rafael and San Francisco metro areas (2.4%) followed by the San Jose metro areas (2.5%) in March 2022.
But 58,700 Workers Have Not Rejoined the Workforce Since February 2020
Residents who are not in the labor force are not counted as unemployed. As a result, the number of unemployed residents can decline while some are still prevented by choice or lack of child care or work in industries that have not fully recovered. However, more workers are now returning to the workforce with an addition of 24,800 in March and 170,800 over the past 12 months.
Industries Were Affected Differently
Four sectors—Manufacturing, Transportation and Warehousing, Information and Professional and Business Services—exceeded pre-pandemic job levels in March 2022 and Construction and Education and Health Care Services were close to full recovery. On the other hand, the Leisure and Hospitality sector recovered only 66.8% of lost jobs by March 2022 though travel and tourism are now picking up again. The Government sector still has fewer jobs now than in April 2020.
Housing Permits Rebound to 2019 Levels in 2021
Housing permit levels were up 35.5% in 2021 over 2020 levels and equaled permit levels in 2019. In the first two months of 2022, permit levels were slightly above comparable 2021 months. There are positive and negative trends going forward. On the one hand, each week brings new large housing proposals and approvals. At the same time mortgage rates and prices and rents are surging.
This year all Bay Area cities are required to update their Housing Elements to meet greatly increased regional and local jurisdiction housing goals. Below is a link to a report released on March 18th that I prepared at the request of the Silicon Valley Community Foundation to help residents understand and engage in their city’s Housing Element update process. Although the report focuses on five Midpeninsula cities—Cupertino, Menlo Park, Mountain View, Palo Alto and Sunnyvale—it has broad applicability for other communities. The report is part of an engagement effort led by SV@Home with local partners.
The report is part of an engagement effort led by SV@Home with local partners.
