Silicon Valley Jobs Report: Job growth down, foreclosures up

posted by Louise Auerhahn

Friday, July 18, 2008, at

Just a quick note on recent data releases. Despite the recent spate of glowing stories about how Silicon Valley titans are still living large, we're not out of the woods yet.

For the San Jose metro area, job growth in June plunged to an anemic 0.1% annual rate, with only 900 jobs added over the year. Today's employment report from the state reveals that Silicon Valley added jobs at its lowest rate since September 2004.

Unemployment in Silicon Valley broke the 6 percent mark, climbing to 6.1% in June.

And regarding the housing market, memo to Business Week: no, Silicon Valley is not a "foreclosure-free zone". If only.

In the second quarter of 2008, 3,679 Santa Clara County homeowners received notices of default, the first step in the foreclosure process (source: This was the highest foreclosure activity on record and a 513% increase over Q2 of 2006.

Not surprisingly, home prices and sales continue to fall, with heavy impacts on jobs in construction as well as in finance and real estate.

Coming in August: Life in the Valley Economy 2008: Silicon Valley Progress Report, with sections on jobs, income, cost of living, health care, housing, education and more. Contact WPUSA to reserve a copy, or download last year's reports, LIVE 2007 (pdf) and the LIVE Labor Day Update (pdf).

Highlights of the local jobs report:

  • Compared to the previous month, the San Jose metro area added 2,300 non-farm jobs in June. These included 1,000 jobs in manufacturing, 900 jobs in leisure and hospitality; 500 jobs in trade, transportation and utilities, which includes retail; 500 jobs in the information sector; and 400 jobs in "other services", all in personal and laundry services. 600 jobs were lost in professional and business services due to reduced employment of accountants and bookkeepers, along with 400 jobs lost in educational and health services as the school year ended. Remaining sectors showed little or no change.

  • Over the year, the San Jose metro area added just 900 non-farm jobs, a 0.1% increase from June 2007.

    • Sectors registering year-over-year job gains included manufacturing (+1,800 jobs), private educational & health services (+1,200 jobs), professional and business services (+500 jobs), information (+1,000 jobs), trade, transportation & utilities, which includes retail (+700 jobs), other services (+600 jobs) and government (+800 jobs).

    • The construction sector remained weak, as housing markets showed few signs of stopping their downward plunge. The construction industry saw a decrease of 2,700 jobs over the year. Also tied to the housing crash and related credit crunch, the financial activities sector lost 1,100 jobs over the year.

    • The region also lost 1,900 jobs over the year in leisure & hospitality, including losses for restaurants and for arts, entertainment and recreation.

  • For June 2008, the unemployment rate stood at 6.1%, up half a percentage point from May and up 1.3 points over the year. That translates to 12,200 more unemployed residents (by official measures) than in June 2007.

  • Eight years after the tech crash, Silicon Valley holds 135,600 fewer jobs than it did in June 2000.

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