Saturday, July 23, 2011

The East Bay Posted a Gain of 8,100 Jobs During June

The East Bay posted a gain of 8,100 jobs during June, an indication that the region's battered economy is turning the corner after the worst down turn in decades.

The increase marked the best performance of any of the Bay Area's metro centers in June. The region added 19,500 jobs last month, with 7,800 in the South Bay and 4,800 in the San Francisco-San Mateo-Marin area, the state's Employment Development Department reported Friday. These numbers were not adjusted for seasonal changes; however, the positive trend was confirmed by a seasonally adjusted EDD estimate.

The nine-county region accounted for more than half of the nearly 29,000 payroll jobs that California added during June, department figures show.

"The Bay Area is leading the way in job growth," said Brad Kemp, director of regional research with Beacon Economics. "And the Bay Area is going to continue that leadership."

The jobs added in the Bay Area during June marked the largest increase since April 2010, according to an analysis of seasonal job trends compiled by the department.

The East Bay economy has been sluggish so far this year, so the robust improvement in the Alameda County-Contra Costa County region during June encouraged Jeffrey Michael, director of the Stockton-based Business Forecasting Center at University of the Pacific.

"I'm still cautious about the East Bay," Michael said. "But I think the worst is probably over."

During 2011, the jobs trend has been consistently stronger in the South Bay than in the rest of the Bay Area.

The tech improvement in the South Bay has unleashed a ripple effect.

"There is a spillover from Silicon Valley that is going into the East Bay," Michael said.

California added 28,800 payroll jobs during June. In contrast, the entire nation added 18,000 jobs in aggregate during June.

The state jobless rate worsened and rose to 11.8 percent in June. That was up from 11.7 percent in May. The unemployment rate is derived from a separate survey of households and doesn't always move in tandem with the payroll jobs data.

An array of industries were the primary leaders in the job gains for the Bay Area's three primary urban centers, the EDD reported:
In the East Bay, professional, scientific and technical services -- a proxy for information technology and research and development work -- gained 2,500 jobs. Leisure and hospitality, construction and health care were also particularly strong.
In the South Bay, construction gained 1,800 jobs and manufacturing was also particularly strong, led by computer and electronics production.
In the San Francisco-San Mateo-Marin region, professional and business services, led by computer systems design work, added 3,900 jobs. Leisure and hospitality was also a strong industry during June.

Although high-tech has become a job generator during 2011, other industries still struggle.

Despite a gain of 7,800 construction jobs in California over the most recent 12 months, that sector isn't out of the woods, warned Steve Levy, director of the Palo Alto-based Center for Continuing Study of the California Economy. Levy said construction jobs remain at recession levels.

"The housing market remains mired in foreclosures and fear," Levy said.

And while the state reported robust job gains, notable losses loom, even in the tech sector, warned Michael Bernick, a San Francisco-based research fellow with the Milken Institute.

"The job losses announced this week from two major California employers, Cisco (CSCO) and Borders, are not factored into these figures," Bernick said.

San Jose-based Cisco disclosed plans to slash 6,500 jobs worldwide and Borders said it would close all its stores, which would erase 600 jobs in California.

Some job seekers are struggling to land work, even amid the improvements in June. Jordan Johnson, of Livermore, said he recently lost his job at a Goodwill outlet, but he had been seeking work even before that.

"The job market is tough right now," Johnson said. "You look for a job and nobody responds to you. It's very discouraging."

Word of massive job cuts and the ongoing challenges for job seekers serve as twin reminders that the regional economy won't soon reclaim the sturdy job levels of a few years ago.

"We can look forward to four or five years of frustratingly slow growth," Michael said.

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