"San Jose and San Francisco are the two metropolitan areas that have recaptured their peak in employment since 2008. That's not true of any other metropolitan area in this state," said Dr. John Silvia, Chief Economist for Wells Fargo.
Silvia was speaking on a panel at The Commonwealth Club of California, looking at how California's economy is faring. The panel, moderated by the Wall Street Journal's Scott Thurm, also included Dr. Michael Boskin, professor of economics at Stanford University, and Ann Winblad, co-founder and managing director of Hummer Winblad Venture Partners.
Silvia pointed out that in his perspective, there's no such thing as a California economy because there are vast differences in economic growth, recovery and the labor force based on metropolitan areas. The kind of success that San Francisco and San Jose have seen is not reflective of the rest of the state. According to a report by the Center for the Continuing Study of the California Economy, the Bay Area grew at a rate of 4.1 percent in 2011, compared to 0.1 percent for the Sacramento region and -0.7 percent in the San Joaquin Valley region. The United States grew at a rate of 1.8 percent during the same period.
It is interesting to note that the size of California's economy and its impact make it an important part of the nation's economy. And in many cases, experts look to see what is happening in California to determine what direction the nation might take. However, in looking at this comparison, there is also recognition of the fact that California is inherently different: Its geography, concentration of technology and political leadership may not make it the most translatable example.
What Silvia is pointing out, however, is that those differences apply internally within California as well. The Bay Area may have the technological concentration that is allowing its economic growth but the same cannot be said of every corner of the Golden State. Preliminary numbers from the Bureau of Labor Statistics show that in December 2013, the San Francisco metropolitan area had an unemployment rate of 4.6 percent. Neighboring Oakland metropolitan area had a rate of unemployment at 6.3 percent. Some of the highest unemployment rates were elsewhere in the state: El Centro faced a 22.5 percent unemployment rate; the Madera-Chowchilla metropolitan area had a 14.2 percent unemployment rate. And the Yuba City metropolitan area had a 13.6 percent unemployment rate.
The differences in economic conditions are being felt on the ground, and there have been people critical of how the state is responding, especially in areas farther away from Sacramento. Supervisors in the far north province of Siskiyou County demonstrated their concerns through a vote of secession. This was followed by a vote of secession by supervisors in Modoc County. Venture capitalist, Tim Draper is even proposing splitting California into six states, arguing that Californians would be better represented with more localized government.
Silvia, Boskin and Winblad also talked about immigration and how a comprehensive immigration bill might address issues faced by employers and employees within the context of California's economic needs. Watch the video above to hear what they had to say and share your thoughts below.
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