New Controller’s Report Finds San Francisco Lost 21,000 Jobs in Last Three Months

According to a new report from the San Francisco City Controller’s office, the city and county lost 21,000 jobs between December 2023 and February 2024, due largely to a mix of holiday layoffs and further firings within the tech industry.

Since late 2022 the San Francisco Bay area has seen a massive jump in layoffs and job reductions, especially within the tech industry. The reasons for such a decline have been numerous, but common reasons for the massive exodus of jobs in the area has included the decline of tech, reconfiguring in a post-COVID world, the high cost of living in the Bay area, and safety concerns of the Bay Area. San Francisco and the Bay Area, still reeling after tens of thousands of job cuts in 2022 and 2023 respectively, looked forward to a better 2024, with less job cuts, a better economy, and new growth industries such as AI helping revitalize the area.

However, a little more than a month into the new year, and 2024 is currently on pace to be just as bad as previous years in the Bay area. Multiple tech companies have already announced the firings of thousands of employees, with some companies getting rid of close to 2,000 employees in a single day. It also bled outside the tech sector, as Levi Strauss announced between 10-15% of their workforce, mostly in San Francisco, are to be fired this year. In February, thousands more were shed. When coupled with the thousands more temporary holiday season worker jobs are added in, 2024 was anything but a great start towards San Francisco’s supposed revitalization year.

The office vacancy rate of 37% in the city, in addition to the retail vacancy rate of 6%, which in reality is about 37% as well according to a recent story by the Globe, is only another indication that more jobs are going out rather than come in. Even the supposed savior of AI companies, the so called ‘cerebral valley‘ moving in couldn’t stop the vacancy rate from growing, albeit more slowly, in the first several months of 2024 so far. This all led to the City Controller’s Office report on Monday.

21,000 jobs lost in three months

“San Francisco metro division lost 21,000 jobs between December and February, though most of the loss is because of seasonal factors associated with temporary hiring for the holiday season. Remaining job losses are mainly in the tech industry, where layoffs are ongoing,” the report said. “The continuing decline in tech employment comes as the Employment Development Department has published revised employment numbers for 2022 and 2023 which show the area’s job losses–particularly in tech and other office industries– were greater than expected.

“Office attendance, as well as MUNI metro and BART train downtown ridership, climbed since December. Since employment in office industries is down, this may suggest the city’s return-to-office is still moving forward.”

While the last part is notable, as it shows that some office jobs are heading back to the city itself, the overall picture is that San Francisco is still declining.

“Unemployment in San Francisco is now 3.8%,” Julie Ochs, a San Jose-based headhunter and hiring specialist told the Globe on Tuesday. “In California it is 5.3%, the highest in the nation. But there is a big difference. Outside of the Bay Area, more people are looking for work post-COVID. It’s not that there are fewer jobs in the rest of California, it’s just that more people want to work now. In San Francisco? It’s because of job losses.”

“The report was right in noting that more people are heading back to the city to work, but that figure has problems with it. These companies workers are returning to are the ones who stuck with their leases and didn’t cancel any during COVID by and large. A lot of companies did cancel leases or downsized to smaller offices. But with this returning figure? These are companies that kept the offices and demanded employees return back home. So these companies aren’t finding new offices to lease, which helps explain why more and more properties continue to be vacant despite workers finally showing signs of coming back to a degree.”

“But even if everything was best case scenario, the city needs to realize that a lot of these jobs, at least from people returning to the office, are not coming back. Employees have actually been taking less pay in order to still work from home or remotely we’ve found. Or they leave those positions for a job where they can work from home. The Controller’s Report helps validate everything we know and have been saying for years now. Keep in mind, those 21,000 job losses included all those gained from tech like AI. One step forwards, two steps back.”

Updated office vacancy reports are likely to come in soon.