The latest report from the California Employment Development Department, or EDD, reveals that Berkeley’s July unemployment rate was 2 percent lower than the California average of 5.9 percent, making it one of the lowest unemployment rates in the state.
At 3.9 percent, Berkeley’s July unemployment rate was the sixth-lowest of 14 cities in Alameda County, according to the state report. Out of California’s 58 counties, Alameda County was one of nine that had an average unemployment rate of less than 5 percent.
“The truth of the matter is we’ve always had a lower unemployment rate than most of the region,” said Michael Caplan, manager of the city’s Office of Economic Development. “Berkeley’s workforce is highly educated and highly skilled, so they’re in demand.”
The presence of UC Berkeley in the city, Caplan said, tends to attract residents with higher levels of schooling. UC Berkeley itself is among the city’s top 25 employers, along with the Lawrence National Berkeley Laboratory, Bayer Healthcare, the U.S. Postal Service and Pacific Steel Casting Company, among others, according to a city economic dashboard reporting data from July to December 2015.
“The largest employers we have are … large institutional employers,” Caplan said. “Even in economic downturns, institutional employment tends to be more stable than in the private sector.”
In the Oakland-Hayward-Berkeley metropolitan statistical area, the biggest field of growth was in leisure and hospitality, which contributed 6,700 jobs — 5,500 of which were in the food and drink industry, according to another EDD report that was also published in July. A metropolitan statistical area, as defined by the EDD website, includes at least one urbanized area with a population of at least 50,000 and adjacent territory that is highly linked economically and socially as measured by commuting ties.
According to Caplan, there are more jobs in Berkeley than there are workers, leading many people to commute and spend their money in the city, boosting the local economy and creating jobs.
EDD unemployment data are based on unemployment claims and surveys, according to Margaret Robinson, EDD research analyst. Though employment and unemployment rates for cities are determined based upon people’s residency, data for industry employment are based upon where people work, Robinson said in an email.
Private educational and health services were other major contributors to employment growth in the area, adding 6,400 jobs, according to the EDD report. Construction and trade, transportation and utilities industries also reported job growth of more than 5,000.
Caplan said Berkeley’s low unemployment rate — which decreased .2 percent from last July — has greater implications for the city.
“When you have low unemployment rates, you have upwards pressure on wage rates,” Caplan said, noting that additional job growth can encourage wage increases, such as the recently passed Berkeley City Council law that will raise the city’s minimum wage to $15 by 2018.