The pace of Bay Area job growth slowed sharply in September, and Santa Clara County suffered overall job losses even as its technology sector continued to add jobs at a brisk pace, state labor officials and economic experts reported Friday.
The September setback of 4,100 jobs lost in Santa Clara County halted 60 consecutive months — five straight years — of job gains. That’s the longest such stretch on record in the South Bay. Before the September decline, Santa Clara County had last suffered a monthly job loss in August 2010.
Job growth was sluggish throughout California, but the statewide unemployment rate improved to 5.9 percent, from 6.1 percent in August, the first time since November 2007 that California’s jobless rate has dipped below 6 percent.
The Bay Area added 2,900 jobs in September, well short of the gain of 14,900 jobs added in August, according to seasonally adjusted numbers released by the state Employment Development Department — a sign of a more normal pattern, according to some economists who have been studying the fast growth of the past year.
“It’s always surprising when an undefeated team loses, it’s going to happen eventually,” said Jeffrey Michael, director of the Stockton-based Business Forecasting Center at University of the Pacific, referring to the slowdown in Santa Clara County and the Bay Area after such a long string of robust job gains. “We have been anticipating some sort of a slowdown, especially in Silicon Valley. The fast pace just can’t be sustained. We will see job growth slow to a more normal pace.”
That would mean a yearly pace for job growth in the Bay Area’s employment market of about 2 percent to 3 percent. Over the 12 months that ended in September, the Bay Area job market expanded at an annual rate of 3.7 percent.
But the technology sector remains robust in the Bay Area, according to an analysis of the EDD report by Beacon Economics.
“Although things are slowing down in Santa Clara County, the core industries for that area, the various technology sectors, are still growing,” said Jordan Levine, director of economic research with Beacon.
The East Bay added 1,900 jobs in September. In a sign that the Alameda County-Contra Costa County region is getting more solid footing for its job market, the September upswing followed a gain of 1,700 jobs in August, the EDD report showed.
The San Francisco-San Mateo region added 4,100 jobs in September, on top of a gain of 9,000 in August, according to a Beacon Economics analysis of the EDD data.
California added 8,200 jobs in September, but that’s a pronounced slowdown from the pace of employment gains over the previous 12 months.
“Job growth was disappointing in September” statewide, said Stephen Levy, director of the Palo Alto-based Center for Continuing Study of the California Economy.
Over the one-year period that ended in August, California had been adding an average of about 40,000 jobs each month, this newspaper’s analysis of the EDD figures shows.
In addition to the statewide improvement, jobless rates in the Bay Area also improved, Beacon Economics reported in a release of seasonally adjusted figures.
The East Bay unemployment rate improved to 4.4 percent in September from 4.6 percent in August; the Santa Clara County jobless rate was 3.8 percent in September, better than the 3.9 percent the previous month; and the San Francisco-San Mateo region posted a 3.1 percent jobless rate in September, improved from 3.3 percent in August.
The East Bay jobless rate is at its lowest level since March 2007, the South Bay is at its lowest unemployment level since April 2001 and the San Francisco-San Mateo region is at its lowest level of unemployment since December 2000.
“The Bay Area overall is still showing solid job growth, and the tech sector remains very strong,” Levine said.
Although Santa Clara County suffered overall job losses, the South Bay added 1,200 technology jobs in September, the Beacon analysis disclosed.
The job losses in Santa Clara County were driven primarily by a decline of 1,100 arts and entertainment jobs, 1,100 health care positions and 1,000 hotel and restaurant jobs, along with 500 government jobs.
Analysts noted that Santa Clara County’s job market has expanded by 4.7 percent over the one-year period that ended in September.
“Even if there is some softening in some sectors in Santa Clara County, it would not be surprising if there is a slowdown from the torrid pace of annual job growth of 5 percent we’ve been seeing there,” said Jon Haveman, chief economist with San Rafael-based Marin Consulting.
The gains in the East Bay were underpinned by 1,200 new retail jobs, 1,200 hotel and restaurant jobs, 1,000 health care jobs, along with 700 new tech jobs. The region also suffered a loss of 600 manufacturing jobs and 600 positions in private education services.
The San Francisco-San Mateo region added 2,900 technology jobs, 1,800 health care positions and 1,000 retail jobs. The primary area of weakness came in hotels and restaurants, which shed 2,600 jobs.
Contact George Avalos at 408-859-5167. Follow him at Twitter.com/georgeavalos.
