The Oakland Unemployment Rate and The The Oakland Underemployment Rate
The Oakland Unemployment Rate has been the subject of much discussion. It has been used to advance the idea that everyone in Oakland, California is gainfully employed. Combined with the high-housing prices and high rents, one could be excused for thinking Oaklanders were rich.
But What’s Underemployment?
Underemployment is commonly defined as “when people are overqualified for the job they are currently working in, typically as judged by the worker’s educational attainment or experience level compared to that required by their job,” as the blog post by economic consultancy Chmura put it best.
In their report called “Introducing Regional Underemployment”, and released August 20, 2018, the economics firm explained that it made “a model for estimating regional underemployment down to the county level”
Moreover, Chmura used “the workforce aged 22-64 and measure underemployment as a worker with a bachelor’s degree or higher working in a non-college occupation, using a similar non-college definition as the Fed.” The economics firm then produced a list of the top 50 largest metropolitan statistical areas, or “MSA’s”.
To cut to the chase, the national underemployment rate was 34.4 percent. That means just over one of every three employed persons in American is underemployed.
That seems to square with the findings in the last Oakland News Now post on a related subject, Oakland’s unemployment rate, and titled “Oakland Unemployment Rate Low Because More People Left The Workforce”.
There, this blogger reported “33 percent of American workers are self employed according to figures drawn from a FreshBooks estimate of 2019 self-employed workers and the Bureau of Labor Statistics (BLS) estimate of Americans working full time jobs in 2019, or 42 million divided by 126 million to get the rate. (FreshBooks is an accounting software firm that produces an annual report on self-employment.) The FreshBooks estimate of 33 percent, or one-out-of-every-three, points to an explosion of work in the self-employed area.”
So, a giant reason for the national underemployment rate rests with the growth of the self employed workforce, and within that the “gig economy” (think people working as Uber and Lyft drivers, as one example). But that’s only the beginning of Oakland’s problem: the underemployment rate for Oakland is actually greater than the national average of 34.4. percent reported in the study.
Oakland’s Underemployment Rate Is 35.7 Percent
Chmura reports that 35.7 percent of the workforce in the San Francisco-Oakland-Hayward MSA is underemployed as of its fall 2018 reporting period. That’s over a full percentage greater than the national average.
Given that San Jose, Oakland’s neighbor to the south, has an underemployment rate of 27.7 percent, a full 6.7 percent less than the average for the country, one can simply conclude that Oakland (and San Francisco) have economies that are not producing enough well-paying, skilled jobs for residents in that area. It may also help explain such problems as the homeless issue in Oakland.
Then, the organization observes “Underemployed workers can be an important source of labor supply for expanding firms. From the economic development side, attracting and encouraging the growth of certain industries can also help alleviate existing underemployment.” From that observation, Oakland must be said to be a poor performer in the attraction and creation of well-paying, skilled jobs, particularly of a non-tech nature.
That observation leads us to question why Oakland’s economic development effort in areas like West Oakland has been so poor. The 2,400 West Oakland Army Base jobs that were lost with the base closure effort of 1993-1994 have still not been replaced.
Oakland’s Economic Development Fail: Poor Blacks, Latinos Pushed Out Of Oakland
Rather than seek a technical solution to perceived but false environmental concerns, the City of Oakland has been content to allow its decision making-process to be hijacked by persons who are trying to create a West Oakland that is the home of more market rate, and high-end housing development.
This runs counter to the words of Oakland’s District Three Councilmember Lynette Gibson McElhaney, said during the 2013 Oakland Global Groundbreaking Ceremony, as reported by Building Construction and Trades Council of Alameda County:
This is a moment to be proud of Oakland.” McElhaney noted that economic benefits of development haven’t always been equally spread. McElhaney said that ensuring that Oaklanders, including residents of west Oakland in particular, were employed by the project was, “a kind of reparations” for those impacted by the base closure, which disproportionately affected west Oakland residents. “There are opportunities now through the jobs policies and economic opportunities for vendors, contractors and subcontractors,” she said. With the reduction in truck traffic and diesel exhaust as Oakland Global shifts to the use of rail and more energy efficient systems, McElhaney noted that the project would “marry greenbacks to the green economy” and be an investment in the community.
McElhaney’s words are one thing, but the reality since 2013 is different: poor and elderly African Americans have been evicted from West Oakland or forced to move by opportunists using the false cry of environmentalism as their argument.
Their interest is not the understandable concern for climate change, for if it were, they would support the development of what is now Insight Terminal Solution’s OBOT, given its reduction in truck operations, and use of rail, as noted by McElhaney.
Their interest is more high-end housing, and further pushing out of poor and black West Oakland. That dynamic goes a long way in explaining why Oakland has an underemployment problem and a homeless problem.