"Try to remember the kind of September…” The song was from a musical named The Fantasticks. In that spirit, try to remember September of 2006. The media crowed that the state added 17,300 jobs that month, and Governor Schwarzenegger crowed even louder, saying the gain was “fantastic.” California’s unemployment rate was 4.8 percent, but San Diego’s fell below 4 percent to 3.9 percent. Among major metropolitan areas, only the San Francisco area, at 3.8 percent, was lower.
San Diego County had 1.3 million nonfarm jobs then, and 93,700 of them were in construction, 103,900 in manufacturing, and 147,300 in retail trade, which was booming. Consumer spending, as measured by taxable sales, rose 2.5 percent in 2006, although that was down from 5 percent in 2005 and an amazing 8.8 percent in 2004. Retail sales in the county peaked at $47.8 billion in 2006, according to a recent study by Kelly Cunningham of the National University System Institute for Policy Research.
The value of residential real estate had soared unbelievably, and people were borrowing against the inflated worth of their homes. Actually, there were signs in September 2006 that the party might slow down significantly someday. Housing prices had peaked in November 2005, according to Standard & Poor’s/Case-Shiller data, although they remained at very high levels. The lead indicators of the San Diego economy, compiled by economist Alan Gin of the University of San Diego, had declined for six straight months.
But few paid attention to such economic esoterica. People thought housing prices would bounce right back up, along with the lead indicators. This was the time to take a job in private industry — say, construction or real estate sales or retailing. This was no time to take a stuffy, bureaucratic government job. Or a job in health care. Why minister to the sick when everybody was doing so well?
Uh, no. Fast-forward to September 2010, the most recent month of data released by the state Employment Development Department. This September, there were only 1.2 million nonfarm jobs in San Diego — down more than 7.5 percent from September 2006. The unemployment rate had climbed from that 3.9 percent of September 2006 to 10.6 percent in September of this year. California’s rate, meantime, had zoomed from 4.8 percent to 12.2 percent. Governor Schwarzenegger was no longer whistling that tune from The Fantasticks. He was looking forward to the fantastic day when he got out of office.
By September of this year, San Diego construction jobs had plummeted 38.1 percent to 58,000 from the same month of 2006. Manufacturing jobs had dropped 12.2 percent to 91,200. Retail employment had dropped 13.2 percent to 127,800. Financial jobs, including real estate, had plunged 18.3 percent to 68,000. Real estate jobs were down 15.3 percent to 20,000.
Cunningham’s study shows that between 2006 and 2009, San Diego consumer spending dropped by 17.4 percent — the biggest decline since 1935, in the midst of the Great Depression. On an inflation-adjusted per capita basis, retail sales peaked in 2005 and fell an astonishing 25.6 percent through 2009.
Yes, try to remember that fantastic September of 2006, because those times aren’t returning soon. Although consumer spending is creeping up this year, Cunningham says it will take more than a decade to get back to previous levels of inflation-adjusted sales in San Diego.
So jobs have disappeared in almost every area of the San Diego economy. Have jobs expanded anywhere? Why, yes: government. Public sector jobs have risen half of 1 percent to 215,500 from September 2006 to this September. It’s not much, but at least it’s a gain. Federal government jobs have gone up 10.1 percent during the period while state and local government jobs have gone down only 1.8 percent.
Had you ignored the private sector’s whoop-de-doo party and taken a stultifying government job in September 2006, you would have been much better off. According to Bureau of Labor Statistics data for December 2009 (the most recent), the average hourly earnings for state and local government workers in San Diego County was $29.66, compared with $21.25 for private industry workers. The data were collected between May of last year and July of this year.
On a job-by-job basis, state and local government workers have higher hourly earnings. Consider business and financial management jobs: state and local government workers average $47.76 an hour versus $39.95 in the private sector. Government workers do more than twice as well in service jobs: $23.29 an hour versus $11.15 in the private sector. State and local government workers do better in office jobs: $20.26 an hour versus $16.75. There is a wide gap in transportation and material moving jobs: an average of $20.14 for state and local government workers and $14.54 for workers in private industry. And also a wide gap in construction jobs: an average of $27.86 for state and local government workers and $21.31 in private industry.
Government jobs pay better, both full-time and part-time: $30.21 versus $22.81 and $21.00 versus $12.67, respectively.
And, of course, government retirement remuneration is much better than that in the private sector. According to the Bureau of Labor Statistics, last year state and local government workers across the nation got $13.65 an hour in benefits. Private sector workers got $8.02. And there is more job security in government.
There has been a health-care bonanza. Since September of 2006, the number of health-care and social-assistance jobs has risen 14.2 percent in San Diego. Nursing and residential-care jobs have soared 29.3 percent as the population ages and life spans increase.
And there is money in health care. Registered nurses average $38.29 an hour, according to the latest Bureau of Labor Statistics data covering civilians in both the public and private sector. Therapists make $33.60 an hour.
The hourly pay in these health-care jobs tops private sector automotive technicians ($21.36 an hour), truck and tractor operators ($16.18), machinery maintenance workers ($19.82), engineering technicians ($24.87), accountants and auditors ($29.78), financial analysts and advisors ($29.58), cooks ($12.58), bartenders ($8.17), fast-food and counter workers ($8.82), and maids and housekeeping cleaners ($9.18). Tips are not included.
But private sector financial managers average $51.73 an hour, and engineering managers make $66.35. Computer software engineers make $58.62.
The San Diego economy has sunk a long way since consumer spending peaked in 2006. Government and health-care workers have grown in numbers and prospered. But most private sector workers have seen jobs disappear. For the most part, their salaries are not competitive with government jobs.