Slower Job Growth in April and Some Good News in the Report
May 23, 2022
TThe Bay Area added 11,500 payroll jobs in April down from 15,500 in March and 24,100 in February. Job growth slowed in the state and nation as well and the region 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 5.8% between April 2021 and 2022 compared to a 4.6% increase in the nation and 5.6% gain in California.
• The Bay Area unemployment rate in March 2022 was 2.5% compared to 2.7% in the pre-pandemic month of February 2020.
• May 2022 brings major crosscurrents to the global, national and regional economy with the Russian invasion of Ukraine, rising interest rates amidst continuing high inflation, the recent spike in Bay Area COVID cases and the ongoing Bay Area challenges of housing, transportation and competitiveness.
• 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
Job growth slowed in the nation, state and region in April. Still, Bay Area payroll jobs increased by 5.8% between April 2021 and April 2022 outpacing the U.S. 4.6% 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 April 2022 the region had recovered 79.9% 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 217,900 jobs in the past year led by a gain of 90,600 in the San Francisco metro area though SF has recovered just 77.1% of the jobs lost between February and April 2020. The San Jose metro area added 59,300 jobs and by April 2022 had recovered 85.8% of the jobs lost between February and April 2020. The Oakland metro area added 47,400 jobs during the past year.
While the region has recovered just 79.9% of the non-farm wage & salary jobs lost between February and April 2020, it has recovered 85.6% of the decline in the number of residents with jobs. The explanation for the gap between the two measures is an increase in self-employment jobs, most likely gig work jobs.
Unemployment Rates Fell to 2.5% in the Region in April 2022 from 6.3% in April 2021 and is now below the pre-pandemic level in February 2020
The lowest rates were in the San Rafael and San Francisco metro areas (2.1%) followed by the San Jose metro areas (2.2%) in April 2022.
But 105,600 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. The number of residents not in the labor force has increased recently, perhaps in response to the rise of COVID cases in the region.
Industries Were Affected Differently
Four sectors—Manufacturing, Transportation and Warehousing, Information and Professional and Business Services—exceeded pre-pandemic job levels in April 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 72% of lost jobs by April 2022, though travel and tourism jobs are now picking up again. The Government sector is now slowly recovering the jobs lost between February and 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.
