A Closer Look at Unemployment in Napa

Understanding employment trends leads to better planning.

Jobs jobs jobs seem to be coming up in every discussion lately around Napa, from creating jobs in the 2nd District Supervisor race, to the kind of jobs a potential Starbucks downtown will create, to how jobs affect traffic and land use patterns. Jobs are a central issue on many fronts, and on top of that unemployment is the issue of the day.

It would therefore behoove us to take a closer look at what we can learn about jobs in Napa and what impact that pattern has on our future here together. I have yet to see a comprehensive analysis of the data that speaks directly to the concerns of the community.  

The government puts out all kinds of charts and data on employment, so much that it is difficult to sort through it all and reach some kind of useful analysis. There are also local officials observations that help fill in some of the data gaps, although they have to be considered at least somewhat anecdotal.

Complicating the whole situation is that there are two kinds of employment/unemployment, civilian, which means people who live in Napa but may work elsewhere, and industrial, which means jobs located at addresses in Napa. When they tell us the unemployment rate is 9 percent, they mean civilian unemployment, which may include a thousand people working in San Jose who happen to live in Napa. Knowing that fact can lead to very different conclusions for future planning.  

In fact anecdotal bits of data from local officials are that much of the unemployment in Napa is just that, people who live in American Canyon who work south, especially in San Jose. A second anecdotal story is that a big chunk of our unemployment came from one company, Cultured Stone, which at one time had as many as a thousand employees but due to the big downturn in construction shrank considerably.

Government data would tend to support that theory, that much of the unemployment in Napa are those working in other counties who live here.

At one point at the height of the recession unemployment in American Canyon was
close to 17 percent, while the county as a whole was around 10 percent, probably mostly due to that.

Looking at this California Employment Development Department (EDD) chart, a couple of interesting data points stand out.

The first is that total employment in Napa has been about the same over the last decade or so, in 2001 there were 67, 900 people employed who lived in Napa, with a total labor force of 70,400.

In 2011, ten years later, there were a total of 69,600 people employed yet the total labor force was 76,500, a much bigger increase than the total employed. And that is not the result of unemployment, in 2006 near the height of the good economy total employment was 69,100, less than last year.

It appears that the number of jobs generated by Napa businesses has held remarkably steady. Certainly there have been some job losses here, but much of the unemployment percentage is from out of town workers who live here.

Looking at other EDD data, we see that between January of 2007 and January of 2011,  2600 construction and manufacturing workers lost their jobs, while hospitality added 900 workers in the same time period. Summarizing a lot of data, including the  article Napa County unemployment rises in January, it is also clear that the other trend in Napa is we are moving away from industrial/construction employment toward hospitality. 

What is changing in Napa is the nature of the jobs, the trend is that we are losing better paying jobs like construction and industrial positions, and replacing them with hospitality positions which don't pay as well. This is in turn exacerbating both the affordable housing problem and traffic during rush hour.

Right now all the numbers are relatively small, and right now we have a lot of options to shape how we want the future to go. If, for example, we double the number of hotel rooms and build out Napa Pipe to house lower wage hospitality workers, our options become reduced. In other words, that becomes more the path we have decided to pursue, the more we pursue it.

Is that really the path we want to take? It is the path with the least resistance. The government likes the TOT taxes from hotels and businesses like the tourist traffic.

The other path is to hold out for more industrial positions and limit the amount of tourism. Understanding that a lot of the pressure to create jobs is actually about people who moved here and don't work here helps alleviate some of that pressure. When they get re-employed they are likely to continue to work outside the county.

We are being told by some that we don't have that choice, that it is not possible because of the nature of the evolving global economy to create manufacturing jobs anymore and that we should just accept our fate as only being able to have a tourist economy. I reject that because America and Napa are never going to be as wealthy as we were if we settle for that, and I believe that manufacturing and higher paid employment will come back to Napa and America as well, but it may take a while. But why give up our options in advance?

Moreover, for us to save our agricultural economy we need to have as small an urban footprint as possible--farming takes up a lot of land. When we create tourism jobs many get filled by people who don't live here who have to drive in. It's not black and white, but generally we are not really reducing employment for other Napans when we do that. Creating fewer jobs that are higher wage is a much better approach for Napa.

This post is contributed by a community member. The views expressed in this blog are those of the author and do not necessarily reflect those of Patch Media Corporation. Everyone is welcome to submit a post to Patch. If you'd like to post a blog, go here to get started.

Lisa Batto May 05, 2012 at 10:39 PM
Great topic Michael. You are right on the spot when you talk about our County or City Government having the data they need to make good decisions. We should know where our residents are working - in or out of county. We should also know the median wage and if they are part time or full time. If they commute with others or on their own. Without good data, how can our governments make good decisions. As far as I know or found out - if they have the data, they certainly aren't sharing it.... I agree that our wine industry, ag preserve and tourism are our main drivers for our economy. Since these are the drivers we have, I don't see the prospect of higher paying jobs. Having been on the unemployment roles, I can tell you that high paying jobs are not in abundance in Napa County. So, I think hit a good point that we need to collectively slow down and take a look at what we need....with good data in hand. Until our county and cities take the time and funds to focus on data collection and analyze it, we are just going to continue to be out of balance.
Michael Haley May 06, 2012 at 05:41 AM
Lauren, I totally agree with you. You have hit all the high points, and I don't know if most people realize what you are saying because our economy has gradually changed into that over time. A smaller and smaller group of people are getting all the benefit out of economic growth, and another point is that it increasingly does not support the government services required to sustain it. You mention another key point, once we go there we can never go back. The reason is that it means building structures, ie buildings, and once you build a building there is so much invested that it literally never gets torn down. So you are stuck with it. Finally, the government has become part of business. They are merged to that point that they are in lockstep and all other considerations are being lost. I need to write a blog about that.
Michael Haley May 06, 2012 at 05:58 AM
Lisa, first of all thanks for your post. Second of all, unfortunately this is the most detailed analysis that has been done, ie my non expert article, by the city or EDD, at least that is publically available. I contacted the city for information on this article and they rely on EDD data and analyze it even less than I have here. And speaking of data collection, if the county actually knew how much more development in terms of housing, hotels, etc that Napa could handle without jamming up the traffic and overstressing services and that Napa Pipe at some level would be accomodated within that, I probably wouldn't have been opposed. Instead we are constantly guessing about something that I don't believe we really have to guess about. Instead we are given development projects that we really don't know what the cumulative impacts will be. I know that Napa can handle more development, but how much? and what kind? At this point after all the growth we have had, and the recession at present, now is the perfect time to figure that out so we know what to do going forward.
tom merle June 06, 2012 at 12:53 AM
These sorts of posts with pie in the sky responses serve as an outlet for that minority that really can't do anything about economic dynamics. If only the critics could come up with some real alternatives, real projects with real investors, or realistic ways for paying for the sort of data requested, instead of engaging in more wishful thinking. But preaching to the converted seems to be enough for Mr. Haley and his acolytes.
Cindy Chambers July 26, 2012 at 05:43 PM
I'm late to the party. I just saw your post, Michael, and I wonder HOW Napa Pipe will house lower wage hospitality workers? I keep reading average price of the townhomes will be around $425,000. Are you relying on apartments to house the workers? In my world, "low wage" does not qualify one for a $425,000 mortgage and hasn't since the bogus bubble daze.


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