California’s unemployment rate in June improved compared to previous months amid the COVID-19 pandemic, but it remains to be seen how recent statewide closings due to increasing cases and hospitalizations affect jobs in the entire state.
In June, the state’s unemployment rate improved to 14.9%, and the state added a record 558,200 jobs, according to figures released Friday by the Employment Development Department. This exceeded record May earnings of 134,200 jobs, and past historical losses with data dating from 1990. The unemployment rate for May was 16.3%.
The state has now recovered more than a quarter of California’s 2.6 million jobs lost in March and April as a direct result of the pandemic. However, June unemployment was still over 2.8 million people statewide. Despite the gains, California’s current unemployment rate remains higher than unemployment during the Great Recession, when the unemployment rate stood at 12.3% in 2010. And just a year ago, statewide unemployment it was only four percent.
In Santa Clara County, the unemployment rate in June was 10.7%, a slight decrease of 11% in May, for a total workforce of more than 1 million people. Santa Clara and San Mateo counties accounted for 6% of California unemployment claims between March and May.
An analysis by the Joint Venture Silicon Valley Institute for Regional Studies found that pandemic unemployment figures even exceeded the post-point crisis in the early 2000s and the local highs of the Great Recession of 2009.
“Silicon Valley technology workers, for the most part, had a smooth transition to remote work and have kept their jobs,” Russell Hancock, President and CEO of Joint Venture Silicon Valley, said in a statement. “At the same time, those who work in retail stores and restaurants and other face-to-face jobs remain largely unemployed.
“The unemployment rate fell slightly in June, that’s a good thing, but what happens next will depend almost entirely on how quickly those establishments can reopen,” Hancock added.
It remains to be seen how recent spikes in COVID-19 cases in California will affect the number of jobs, especially given another set of closings announced this month by Governor Gavin Newsom for many industries, including restaurants, bars, hair salons, and nail salons. . . Technology workers, by contrast, have been spared as many companies have turned to remote work, as reported by San José Spotlight.
The institute’s research director, Rachel Massaro, noted that the unemployment rate in the midst of the pandemic provides “a relatively dated and retrospective snapshot.”
“The frequency with which the economic reopening and the health crisis are changing is too high to be captured in a survey-based estimate mid-month,” Massaro said in a statement.
On Monday, Newsom said the closings affect more than 80 percent of the state’s population, including South Bay, which opened personal care services, gyms, gyms, and hotels and motels for hours before having to close again Wednesday by state order.
Jesús Flores, who heads the Alum Rock Santa Clara Street Business Association and the Latino Business Foundation, said many of the business owners he represents worked hard before the second round of closings to enact social distancing protocols, install barriers and other safety measures to meet county standards But soon after, they had to close again.
Still, nine of California’s top 11 industry sectors got jobs in June. Hospitality, for example, had the highest gain of 292,500 jobs due to growth in lodging and food services, which benefited from the statewide reopening of bars and restaurants, according to the EDD. Percent, construction has had the highest recovery after 68% of job losses.
But governments saw the largest number of job losses, with 36,300 statewide, which may be due to cuts after historic budget deficits.
Flores, who collectively represents at least 450 small businesses in San José, said that federal and state unemployment benefits and programs to help small businesses have likely increased employment gains.
While no business that Flores represents received the first round of loans from the Federal Salary Protection Program to rehire employees in April, he said that many have now received loans in the second round. There has been national criticism of PPP loans, as many black and Latino-owned small business owners were initially left out of the assistance program compared to large white-owned companies.
Flores estimates that at least 30% of the companies he represents have now received loans, averaging around $ 17,000 per company.
But the uncertainty is coming as the additional $ 600 a week in unemployment benefits runs out in late July and the Santa Clara County eviction moratorium for residential and commercial tenants ends in August. And now, South Bay businesses closed again this week as a result of the county landing on the state watch list for its number of hospitalizations.
“I hesitate a little bit to think this is stable for a while,” Flores said. “Now there are orderly closings, I think that will also be very detrimental to small businesses again and job creation.”
State numbers for July are expected to be released on August 21.
Contact Eduardo Cuevas at [email protected] or follow @eduardomcuevas on Twitter.
