City’s unemployment hits new high 

The number of people who are without a job is at its highest point since the recession began, the city controller said, with 46,900 unemployed.

The City’s unemployment rate shot up to 10.3 percent in January compared to 9.9 percent in October and 7.7 percent in January 2009, according to a report released Wednesday by the City Controller’s Office.

“I wouldn’t say I’m surprised,” said Herb Cohn, a certified public accountant and president of the San Francisco Council of District Merchants Associations. “Unemployment has always been the lagging indicator.”

Businesses are compelled to cut back on hiring because people are spending less money during the recession.

San Francisco’s hotel activity is down and businesses in Union Square continue to struggle, as indicated by a decline in the number of people who exited BART near Union Square on weekends, according to the report.

An estimated 21,291 people exited the BART station at Powell Street, an entrance to Union Square, on an average Saturday in January compared to 27,882 in October, according to the report.

However, Linda Mjellem, president of the Union Square Business Improvement District, said declining BART trips to Powell Street doesn’t necessarily mean a drop in retail sales.

But she said there was less foot traffic and fewer business conventions in the area during the past month.

“As the national economy continues to struggle, so do all of us, but I don’t think disproportionately so,” Mjellem said.

The report is a clear indication the economy hasn’t gotten better, but it isn’t getting worse, a signal that San Francisco has bottomed out and job recovery is on the horizon, said Steve Falk, president and CEO of the San Francisco Chamber of Commerce.

This month, the Bay Area Council released a survey concluding that businesses plan to do more hiring than firing during the next six months.

“It’s not all doom and gloom,” Falk said. “Obviously the figures aren’t good, but I don’t see this as another big step backwards. I think we will begin to see, over the next several months, an uptick in employment in San Francisco.”

Falk pointed to major construction projects set to break ground in San Francisco this summer, including the Transbay Transit Center, which is expected to generate more than 125,000 construction jobs.

Even with the spike in the number of jobless San Franciscans, The City’s economy is faring much better than other metropolitan areas in the state, said Ben Rosenfield, the city controller.

“Our residential real estate market, while down 15 percent, compares favorably to Los Angeles and San Diego that have, in some cases, lost 30 percent of their value,” Rosenfield said. “So while the news is not good in San Francisco, it’s worse elsewhere.”

In a statement, Mayor Gavin Newsom said, “Though we’re seeing some signs of recovery, unemployment in San Francisco and across the state remain stubbornly high. It shows our No. 1 priority at every level of government must continue to be putting people back to work and helping businesses create jobs.”

esherbert@sfexaminer.com

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