San Mateo County has the lowest unemployment rate in the state in July at 1.9%, bringing good news for the economy following the pandemic but challenges for businesses and those still unemployed.
Of the 456,100 people in the county labor force, around 8,900 people are unemployed, according to the California Employment Development Department. San Mateo County’s unemployment rate in February 2021 was 5.3%
California’s unemployment rate is also doing well at 3.9% for July, a new record low. The state added around 84,000 nonfarming jobs. The state was at a 7.4% unemployment rate in July 2021, with the state mostly recovering from pandemic losses.
Marlena Sessions, the executive director of workforce development center NOVAworks, said the continued growth in tech and biomedical fields drives the low numbers, as does increased building construction. NOVAworks has an office in San Mateo and works with businesses and workers to find jobs, provide training services and navigate the labor market. Visitors to the center have not slowed down, with older workers seeking a career shift, people left behind in the past and recently laid-off employees all showing up. The hospitality and early child care industries have been hit hard, with a shrunken labor pool resistant to returning to essential worker jobs.
NOVA is also working with business owners to change hiring practices and application processes to cast a wider net during these challenging times for business owners. Sessions cited competing and higher wages being offered to employees between different restaurants.
“There’s a lot of the stealing and poaching going on for sure,” Sessions said. “It’s a struggle right now for employers.”
Philip Chan, owner of Velo City Pizza on West 25th Avenue in San Mateo, is one employer who struggled to hire recently. He recently hired a worker committed to the job but went through a rough hiring process. After two longtime employees left and took raises elsewhere, he hired one worker who only showed up for a day and struggled to find workers. Many workers have left for the gig economy or moved away, with the high cost of living playing a role. Those who stay tend to have more options, with Chan only having half the people who signed up for interviews show up.
“You need to pay at least $20 or more an hour to get people to come in,” Chan said.
It is also harder for small businesses to compete against bigger companies. Chan has raised prices to deal with inflation, with pizza box costs going from 20 cents to 60 cents, with flour nearly doubling in price. Chan said the situation is worse in San Francisco, where people are now only accepting $25 an hour.
Rosanne Foust is the president and CEO of the San Mateo County Economic Development Association, an organization aimed at promoting business. She noted San Mateo County is incredibly resilient in rebounding during economic downturns but still has people who need help.
“It is a number that is both positive and concerning,” Foust said of the unemployment rate. “We still have people who are unemployed.”
Foust said hospitality businesses like restaurants have had to adjust hours because they employees have not come back like before the pandemic. Luckily, the county benefits from extensive industry diversification and churn, meaning they start, grow, merge, die or move out, creating a strong business ecosystem.
“That is what has made us resilient to different economic shifts,” Foust said.
Downshifts, like the pandemic, allow people to shift jobs and industries and build new skills they can take into the workforce. In the future, Foust wants to tackle the systemic issues that make it more challenging for workers, like transportation, housing and child care.
“The high cost of housing is really hurting people, and that’s something SAMCEDA is really focused on,” Foust said. “How do we build more housing, especially at our low and very low [levels]? It is a pain point for people.”
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