While high tech has given the South Bay one of the nation's strongest job markets over the past year, the tech sector no longer stands alone as an engine of economic growth in the Bay Area.
Other industries -- some of them left for dead by economists only a couple of years ago -- have turned into powerful engines, according to this newspaper's analysis of job trends supplied by the state's Employment Development Department.
Construction, retail, wholesale trade, manufacturing and restaurants, bars and hotels have joined technology to generate an upswing for the entire Bay Area.
"For a long time, people have been asking the question whether the rising tech tide in the South Bay would lift all boats," said Jon Haveman, chief economist with the Bay Area Council's Economic Institute. "That is starting to happen. Jobs that are being created in technology are starting to drive employment growth in other parts of the economy."
Jerry Nickelsburg, senior economist with the UCLA Anderson Forecast, agrees that the recovery is widening. "It started with investment in tech equipment, software, Internet services and tech-related manufacturing," he said. "That is now reaching other economic sectors."
The recovery is also spilling into other parts of the Bay Area. While job growth started most strongly in the South Bay, it has extended to the San Francisco-San Mateo-Marin metro region and, to a lesser degree, to the East Bay.
Over the
one-year period that ended in November, construction was the fastest-growing industry in the Bay Area, growing 9.7 percent and adding 10,900 jobs. The information industry -- which includes Internet, software, telecommunications, motion pictures, publishing and broadcasting -- posted a 7.4 percent increase in employment totals, adding 8,500 jobs. The tech-oriented professional, scientific and technical services sector added 18,000 jobs, a 5.5 percent increase.
Other strongly growing industries include educational services, wholesale trade, health care, hotels and motels, retail, and restaurants and drinking establishments.
This is a sign, analysts say, that the strong tech economy is leading to a boost in consumer spending, reigniting growth in a wide range of industries throughout the Bay Area.
"Although business investment in technology is likely to remain strong, spending by South Bay residents will begin to play a larger role in overall growth," said Jordan Levine, director of economic research with Beacon Economics.
The information, Internet, telecommunications and software sector remains one of the top performers in the South Bay, adding 4,500 jobs and expanding by 8.9 percent over the one-year period that
ended in November.
But the fastest-growing industry in the South Bay is now construction, when measured by percent change. The construction industry added 4,300 jobs over the year, a jump of 13.2 percent.
Overall, job totals in the South Bay grew by 3.7 percent over the year. In most of the monthly surveys of U.S. metro regions conducted by the U.S. Bureau of Labor Statistics over the last two years, the South Bay ranked No. 1 in job growth nationwide.
The San Francisco metro region was close behind, with a job base that grew by 3.4 percent. The East Bay has recovered more slowly but saw job growth rise 1.9 percent.
Construction's surge is especially significant because the collapse of the building industry following the meltdown of the mortgage and housing markets is frequently cited as the reason the recession was particularly vicious in the Bay Area.
"A lot of the construction gains are in two sectors, one in apartments and the other is new buildings, remodels and expansions of existing office buildings for technology companies that need more room," said Stephen Levy, director of the Palo Alto-based Center for Continuing Study of the California Economy.
And in the same way the tech boom in Silicon Valley spurred the Bay Area-wide uptick in jobs, the gains in other sectors of the economy are strongest in the South Bay but likely to spread to other parts of the region.
For instance, Mountain View-based Google (GOOG) and Cupertino-based Apple (AAPL) have been leasing or buying properties at a rapid pace. The two tech behemoths have consumed so much office space in their hometowns that they are now expanding into Sunnyvale. That, in turn, has spurred more development and construction in Santa Clara and North San Jose.
"I'm getting more construction jobs than before," said Joshua Root, a San Jose carpenter and handyman. "A lot of my friends who had been sitting at home have jobs now. Things are a lot better."
For Root, though, the recovery in construction is far from complete. He said he can't make as much on a job as before.
"The big problem is customers want to pay less," Root said. "I can't get hired for more than $25 an hour. I used to make $30 or more."
The experience of workers like Root supports a recent study Haveman conducted. For every new job in the tech sector, three or four jobs are created in other industries, he found in a report he recently completed about the U.S. technology market.
"Technology is a high-income type of position," said Michael Yoshikami, chief executive of Walnut Creek-based Destination Wealth Management. "When you have tech hiring, it is inevitable that there will be an impact on other parts of the market."
"You are seeing restaurants filling up, stores are filling up, hotels have more guests," Levy noted.
Carlos Mendez has seen the improvement this holiday shopping season at the South Bay store where he works.
"Traffic has definitely picked up and more customers and more people are buying," Mendez said.
And all signs point to continued good times in Silicon Valley, which should ultimately benefit the entire region. Scott Anderson, chief economist at Bank of the West, recently attended a gathering of executives from large, medium-size and small tech companies that make apps for mobile devices, where he got signals that the tech boom will keep moving ahead.
"They think this is a second wind for Silicon Valley," he said. "Silicon Valley is the epicenter of growth in the country right now and will continue to be that way."
Contact George Avalos at 408-373-3556 or 925-977-8477. Follow him at Twitter.com/george_avalos. ___
(c)2012 the Contra Costa Times (Walnut Creek, Calif.)
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