By Steve Levy
Strong Regional Job and Population Growth ContinuesUploaded: Dec 20, 2014
The state and Bay Area saw exceptional job growth in November?over 90,000 jobs in the state and 23,000 in the region. While one month is not a trend the growth over the past year and past four years is a trend that says the economy is strengthening. In the Bay Area the economy is surging when measured by job growth and reductions in unemployment rates. Over 400,000 jobs have been added in the past four years.
Some recent data are summarized here Jobs memo.
The best piece of news from my perspective is that Bay Area job growth is strong enough to both reduce the unemployment rate and allow workers who dropped out to rejoin the workforce. Over the past 12 months the Peninsula and East Bay labor force has added 84,000 workers, far more than came from population growth alone. At the same time the unemployment rate declined in the East Bay from 7.1% to 5.7%, in the SF metro area that includes San Mateo County from 5.3% to 4.2% and in the San Jose metro area from 6.3% to 5.2%.
And in the year ending in June 2014 Santa Clara, San Mateo and San Francisco counties were ranked in the top four for average wages, the top five for dollar wage gains and in the top 5% for percentage wage increases.
Challenges remain. The economic boomlet?(the peninsula economy now has 10% more jobs than before the recession)?has caused rapid and challenging increases in housing prices and rents as well as traffic. Moreover, the wage gains to date have been concentrated in workers already earning high wages.
Residents and policy leaders should expect at least two more years of substantial job growth before the pace will slow. This outlook is broadly shared among economists. A few quotes from today's Mercury News report:
"The quality of the job growth really stands out to me" Jordan Levine, Beacon Economics. "The industry diversity in job growth means the growth is resilient" Tracey Grose Bay Area Council. ""The Bay Area is knocking it out of the park in the job creation department" Scott Anderson Bank of the West. "It is a very broad based and sustainable recovery".
For the first time since the 1850s the Bay Area is the state's population growth leader confirmed by new population growth estimates released in December for 2014. I will write more about this in a later blog. But one implication is clear. With job growth continuing and unemployment rates having declined substantially, the next round of growth will bring more new residents to the region.
The last time housing was more affordable and the commute hour less congested was in the midst of the recession.
The challenge for residents and elected officials throughout the region is to address the region's housing and transportation challenges while preserving the economic vitality that makes the Bay Area economy what other regions strive to be like.