County unemployment inching higher, while industry growth mixed

Technology and life science firms are still comprising a large portion of the county’s layoffs, even though the number of announced cuts are slightly lower in the first half of 2024 compared to 2023. Those two sectors are still on the road to recovery, said Rosanne Foust, president and CEO of the San Mateo County Economic Development Association, but there are others showing a relatively strong performance. 

“I do feel more optimistic because we have an aging population and all of our health care members that I’ve spoken to are trying to hire in different sectors, whether it’s medical assistants, operating room techs, nurses, physicians, physical therapists, mental health care professionals,” she said, adding that hiring in airline, food service and public transit agencies are also trending well. 

According to data from the Employment Development Department, total employment numbers in July were barely higher than the previous July, though those figures also encompass San Francisco, which Foust said tends to “bring San Mateo County’s numbers down,” and hiring data typically lags several months behind unemployment statistics.

While technology and life science firms continue to cut costs and positions — biotech layoffs so far this year are not too far behind 2023, which saw some of the highest in nearly a decade — Bay Area venture funding shows an uptick compared to last year, largely going toward artificial intelligence firms. According to CB Insights, the region saw about $18 billion in funding last quarter, up from $15 billion the first quarter and almost double last year’s second quarter. 

“I do feel that there is an energy now in the venture industry that I wasn’t feeling two years ago,” she said. “Now they’re maybe feeling a little more comfortable with risk.”

But even though inflation level and impending interest rate cuts are giving some room for optimism, it will likely take time for the bleak financing landscape to reverse. Building enough housing and commercial developments is the toughest challenge many Peninsula cities face right now, said Foust.

“The biggest thing that’s holding us back right now is the lack of housing and people having to live far away. One of the things that probably saves us in some way is remote work because people are able to actually live further out in the East Bay or further out in the South Bay,” she said. “But that doesn’t help our downtowns.”

And without robust local economies, growing companies may find other places to call home, which could be particularly concerning for San Mateo County, as AI funding continues to grow in the Bay Area, though less so in San Mateo County, which only added 467 new AI jobs between April and July, according to LinkUp data. That’s quite low compared to about 2,600 and 3,800 new AI jobs added over that same time period in San Francisco and Santa Clara counties, respectively. 

“If we’re not filling office spaces, I always worry about the next wave of innovation that’s going to hit,” Foust said.

alyse@smdailyjournal.com

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