Sonoma County jobless rate jumps to 6.5% in December, reversing months of gains

Sonoma County’s unemployment rate rose to 6.5% in December, the first increase in joblessness since last spring when initial public health stay-home orders went into effect and an indicator of more economic turmoil ahead.

The bump up from 5.5% in November represented the end of consecutive monthly unemployment declines from the 14.5% peak in April, when 35,100 county residents lost their jobs, according to data released Friday by the state Employment Development Department.

The county labor market’s reversal was foreshadowed by the resurgence of coronavirus infections that prompted local and state authorities last month to again enact stiff restrictions on business and public activities, including temporarily limiting restaurants to only takeout and delivery, and the inability of Congress for eight months to agree a fresh round of federal financial aid until late December.

“We kind of knew there was going to be an uptick” after the commercial limitations and the prolonged lack of federal stimulus, said Robert Eyler, a Sonoma State University economics professor who closely monitors the county labor market.

Eyler said he expected the local unemployment ranks to swell in January since the full effects of businesses cutting more jobs due to the latest stay-home order enacted Dec. 12 came after the state employment department calculated last month’s local jobless report.

Looking ahead, the economist said, the fortunes of the county economy and labor market are tied to how quickly county public health officials can get the pandemic under control. That would result in the resumption of business reopenings, more people returning to work and an increase in consumer spending. Showing the path to robust labor market could be long, the jobless rate in the county was a mere 2.4% in December 2019.

“If we can get to the point where we’re lifting those (business and public) restrictions again, we’ll probably see decent jobs open up again,” Eyler said.

There were 16,200 county residents without jobs last month, 2,400 more than in November. The county’s civilian labor force declined 1% in December to 234,400 workers.

The area hospitality and leisure sector has been particularly hard hit in the pandemic and shed 600 more jobs in December to 18,600, a 27% drop from a year ago. Businesses in that industry continued to lay off workers last month, including Safari West, which furloughed 73 workers, and The Lodge at Sonoma, which jettisoned 123 employees.

Meanwhile, the occupancy rate for the Sonoma County hotel and lodging sector in 2020 was 53%, a 29% decline compared to 2019, said Claudia Vecchio, CEO of Sonoma County Tourism.

“We had some decent months during August, September and October when we were open a little bit,” Vecchio said. “But then when we got to November and December we were way down. ... Tourism continues to be under tremendous pressure.”

Another area of concern is local government employment, which was flat in December at 21,200 workers countywide. That’s down 16% from a year ago. U.S. Rep. Mike Thompson, D-St. Helena, said he has heard from city and county officials about their worries over how to balance their budgets this year, while having to pay the increasing tab to combat the pandemic with local tax revenue on the decline.

“Every local government in our district is getting hit hard,” Thompson said. “They all need help.”

President Joe Biden’s proposed COVID-19 rescue package is crucial, the congressman said, since it would provide $350 billion in aid to state and local governments.

A pet project of Thompson’s was included in the Biden plan. It would have the federal government cover 100% of the cost to states and counties to partner with local restaurants to provide meals for vulnerable residents during the ongoing pandemic. In turn, that would give a boost to the county restaurant industry, to which the coronavirus has delivered a harsh blow.

The upward joblessness trend stretched statewide in December. In the region, the unemployment rate rose to 8.1% in Mendocino County, from 6.8% in November, and to 9% in Lake County, up from 7.2% the previous month. And California’s jobless rate rose 0.9 percentage points to 9.0% to close 2020.

You can reach Staff Writer Bill Swindell at 707-521-5223 or bill.swindell@pressdemocrat.com. On Twitter @BillSwindell.