On Guard: The hunt for the truth behind SF’s rosy unemployment numbers

Mayor Ed Lee wants San Francisco to rejoice, announcing The City's unemployment rate is 3.8 percent, the third-lowest in the state. And we all have the tech sector to thank for this, Lee would have us believe.

To wit: “Today's unemployment numbers demonstrate, once again, that our economic policies are working and that more people in San Francisco are able to support their families and share in the success of our City,” Lee wrote Friday to reporters in a canned statement.

But before you start throwing roses at Twitter employees, be warned: The number is only skin deep. Affordability and displacement plague The City. And other unanswered questions linger.

Are noncity residents moving into San Francisco to swoop up these new lucrative tech jobs? Are San Franciscans being displaced as the new workers migrate in? What are the unemployment numbers across the neighborhoods, and by age, or ethnicity?

This is a boom, for sure — but for whom?

The gulf between what we know and what we don't is vast. And knowledge is the first step in fixing The City's affordability crisis, which in the State of the City speech the mayor said was his top priority.

So, intrepid gumshoes, don your Sherlockian dog-eared caps and join me as we sleuth for truth. Are these unemployment numbers the real deal?

My first stop was the scene of the disturbance, the state's Employment Development Department, which generated the unemployment numbers.

“You're asking very difficult questions,” Ruth Kavanagh, research program specialist at the EDD told me. “We don't currently track the details of who are getting those jobs.”

And then I turned to Tyler Macmillan, executive director of the Eviction Defense Collaborative, who said that employment numbers may in fact be boosted by displacement. Macmillan said losing a job in San Francisco can “absolutely” push someone towards eviction, and eventually displacement from The City.

“Landlords want their money right away,” Macmillan said. “It's really brutal.”

And that's why having data on who is benefitting from job creation is so crucial. From Macmillan's view, those losing jobs are leaving The City — an ugly way to get low unemployment numbers. That's anecdotal of course. We need the real data.

It was then that I went to the source, the Mayor's Office of Economic Workforce Development. No one there had any useful answers on hand.

But Ted Egan, San Francisco's chief economist, had some insight. He said he had never before been asked to look at where the people came from to claim these new jobs, and he looked at 2013 numbers to find out.

What he found surprised him: “It's a pretty big number.”

During 2013, the number of employed residents of San Francisco increased by 13,000, of which about 3,000 were newcomers.

“Nine percent of the employed residents had moved in within one year,” Egan said.

That means, some San Franciscans are taking the new jobs created, but an outsized (and to Egan, surprising) portion of people were coming into San Francisco for new jobs.

And many of the jobs created were in the service sector — flipping burgers for tech workers. That might seem to poke a pretty big hole in the happy new unemployment numbers.

Egan disagreed, saying a significant portion of jobs was being created for people who lived in San Francisco for over one year. But there's a hole in that data, too.

I postulated this to Egan: If we looked at data from the cusp of the tech boom, would we find many more of the jobs created were given to people from outside San Francisco?

“It is true if at the very beginning of the tech boom and tech was hiring into The City, maybe you would see a high percentage of people who were newly employed residents and newcomers,” Egan said

“But,” Egan added, he doesn't want to guess. He'd need more time to run those numbers.

It's troubling though that The City's chief economist doesn't know the employment breakdown because no one has asked him to crunch the data (until now).

Former Mayor Art Agnos has a theory as to why.

“The reason a mayor would not want to measure [employment data] is he doesn't want to know the answers,” Agnos said. “It would show that so many of these high-tech jobs, which have caused the rental and homeownership boom, are people moving into The City by the tens of thousands to take these jobs.”

“That's not what you promote when you're running for re-election,” he added.

Well, someone needs to ask the question. Some supervisors we spoke with hinted they may ask for this information soon. If we don't have the information, we may never know how many San Franciscans we've priced out of new jobs — and The City itself.

On Guard prints the news and raises hell each Tuesday. Email him at joe@sfexaminer.com.

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