California’s beleaguered restaurant and hospitality industry rebounded in October, adding 66,000 jobs as the unemployment rate in the nation’s most populous state dipped below 10% for the first time since the pandemic upended its economy in March.
But the gains are likely to be short-lived as a surge of cases has already prompted new restrictions on businesses, including forcing most restaurants to halt indoor dining during the cold and rainy winter months. Starting Saturday, the state will enforce a 10 p.m. curfew that could further curtail people’s leisure spending.
“With the renewed lockdowns, these jobs are in peril now,” said Michael Bernick, an attorney and former director of California’s Employment Development Department.
California Labor Secretary Julie Su said the rise in newly reported coronavirus cases is a reminder “how our economy is tied to the ongoing public health crisis.”
“California’s ongoing economic recovery depends upon each and every one of us doing our part,” Su said in a joint statement with Chris Dombrowski, acting director of the Governor’s Office of Business and Economic Development. “How we choose to navigate public and workplace interactions will have a direct impact on our loved ones, our communities, and our economy.”
Assemblyman James Gallagher, a Republican from Yuba City, said the state’s restrictions — including the curfew — “will only further decimate struggling businesses.”
“None of these orders matter unless Californians buy in and change their behavior,” Gallagher said.
Overall, California added 145,500 nonfarm payroll jobs — with farmwork excluded because of its seasonal fluctuations — as the unemployment rate fell to 9.3% in October, the sixth consecutive month of job growth after the state lost more than 2.6 million jobs in March and April because of a statewide stay-at-home order prompted by the pandemic.
California has now gotten 44% of those jobs back, according to a report released Friday by the state Employment Development Department. But the report shows more than 1.7 million people are still out of work, up more than a million from this time last year.
Meanwhile, data from Harvard and Brown universities show California’s job losses are not equally distributed, with jobs paying more than $60,000 a year declining just 1.3% since January while jobs paying below $27,000 a year have declined 28.1%.
“This fault line was present before the pandemic. It has grown during the pandemic,” Bernick said.
The jobs report is based on a survey conducted during the week of Oct. 12. Nine of the state’s 11 industry sectors gained jobs. The biggest gains were the 66,000 jobs in leisure and hospitality, 35,800 jobs in professional and business services and 26,300 jobs in construction.
California continues to outpace the rest of the country in weekly filings for unemployment benefits. While California accounts for roughly 11% of the nation’s workforce, the state had more than 20% of the nation’s unemployment claims last week.
Since March, California has paid $110 billion in unemployment benefits and processed 16.4 million claims. Many of those people have benefited from the federal government’s pandemic unemployment assistance program, which extends unemployment benefits to people who normally are not eligible for them — including independent contractors.
An estimated 750,000 Californians could lose their unemployment benefits in December as various federal government programs are set to expire, according to an analysis by the California Policy Lab.