With a talented workforce of 4.2 million people, the San Francisco Bay Area is one of the world’s most dynamic and productive regional economies. The region’s growth and its ability to thrive after economic recessions are the focus of new data recently released by the Metropolitan Transportation Commission and Association of Bay Area Governments (MTC/ABAG).

After eight years of economic recovery following the Great Recession, unemployment in the Bay Area is at a thirty-year low. The Great Recession led to a dramatic spike in unemployment across the country. In the Bay Area, the regional unemployment rate more than doubled, rising from 4.5 percent in 2007 to 10.5 percent in 2010. At the 2010 peak, over 388,000 workers in the Bay Area were unemployed. During the current economic boom, the unemployment rate has declined each year since 2010. The current rate of 2.6 percent is lower than levels experienced during previous economic booms in the late 1990s and mid-2000s.

The majority of Bay Area communities have seen unemployment declines of more than five percentage points since 2010. Oakland, the third most populous city in the region, represents this regional trend. The unemployment rate in Oakland was 3.3 percent in 2018, a 12 percentage point improvement from its peak of 15.4 percent during the height of the Great Recession. This shows improved conditions for the labor force, but it could also be a reflection of rising housing costs and the subsequent displacement of unemployed Oakland residents to more affordable communities.

Grace Erickson is general manager at OCHO Candy in West Oakland. OCHO has been producing organic chocolate from its West Oakland factory since 2013 and employs about 40 workers.

“We’ve had a good amount of growth and have hired five new employees in recent months,” says Erickson, who is currently looking for a quality assurance coordinator.

“The job market is tight so we use temporary workers,” she adds. “I am personally coordinating two hiring events and working with EDA and the West Oakland Career Center.”

The Bay Area’s strong economy has resulted in a robust job market with the lowest rate of unemployment among the ten largest U.S. metro areas. Overall, a larger share of Bay Area cities is experiencing low unemployment. In 2018, over 75 percent of Bay Area cities had unemployment rates below 3 percent.

“It’s always harder when the unemployment rate is this low and so it will take longer to fill the role or to find the right candidate,” says Erickson. “We’re getting people who already have a job and are looking to change jobs – we have less unemployed candidates applying.”

Economic Growth

Dynamic metro area economies help to drive growth in the national economy. Looking at the gross regional product (or GRP) – similar to gross domestic product, which gauges the size and strength of a nation’s economy – allows a calculation of the value of the goods and services produced. A growing GRP indicates that a region’s businesses are competing successfully in today’s fast-moving, globalized economy.

The Bay Area economy, $900 billion strong, has performed well in the first two decades of the 21st century. Notwithstanding two significant recessions – in 2001-2002 and in 2007-2009 – the region boosted its inflation-adjusted economic output by 59 percent from 2001 to 2017. While a growing population explains some of this growth, the region’s economy has still grown by 40 percent since 2001 when evaluated on a per capita basis. Since 2009, the low point of the recent downturn, the region has added $257 billion to its GRP, an average of nearly 5 percent growth each year. When it comes to economic output, the Bay Area is growing faster than any of its peer metro areas.

The Bay Area’s economy has been the nation’s best performer since 2001, with its 40 percent per capita GRP growth outpacing other major metro areas by a wide margin. Prior to the Great Recession, our region’s economy was also one of the faster-growing in the nation, along with those of Los Angeles, Miami, Washington and New York. Since the Great Recession, however, these other large metro areas have seen little-to-no growth in per capita GRP – while the Bay Area economy has continued its upward trend. Our region’s 2017 per capita GRP also topped the list of its big-city peers, outperforming the nation’s energy, political and financial hubs (Houston, Washington and New York, respectively) by at least $30,000 per person.