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Employment economist says Portland hurt by big losses in restaurant, bar and hotel jobs during pandemic.

PMG PHOTO: COURTNEY VAUGHN - Restaurants, including Bollywood on Portland's east side, were hit hard by the pandemic. Since hospitality jobs are predominantly in urban areas, those counties have seen weakened job recovery. Multnomah County, which often leads Oregon out of economic downturns, is lagging this time.

An economist for the Oregon Employment Department says the state's most populous county is one of two that has regained only three of 10 jobs lost during the downturn resulting from the coronavirus pandemic last year. The other is Benton County, whose seat is Corvallis, and is dependent on education and government jobs.

"They led in Oregon's recovery from the Great Recession, but they are lagging in the wake of COVID-19," employment economist Gail Krumenauer told reporters during a weekly conference call. "So are metropolitan areas nationwide."

Multnomah County's official unemployment rate for June was 6.2%, above the statewide rate of 5.6%. Benton County, despite a similar lagging recovery, was at 4.4%.

For the entire Portland metro region, which covers five counties in Oregon and two in Washington state, the rate was 5.7%. But in Washington County, it was 4.9%, and in Clackamas County, it matched the statewide rate of 5.6%. Columbia County recorded 6.4%, Yamhill County 5.4%, Clark County (Washington), 5.1% and Skamania County (Washington), 6%.

Krumenauer said the regional unemployment rates in 51 metropolitan areas across the United States (Portland is 25th in size) exceeded their statewide averages.

She and Employment Department colleagues released a report July 7 on who got hurt most and which job sectors suffered the most losses during the pandemic recession in Oregon. The report concluded that women, racial and ethnic minorities, and young workers under 25 were hurt the most.

Leisure and hospitality, other services, and private education took the biggest hits.

Multnomah County alone lost 63,000 jobs in leisure and hospitality, half of the county's total in that sector — and larger shares of that workforce are women, racial and ethnic minorities, or those under 25.

"Portland has so many more jobs in leisure and hospitality than, say, Salem," Krumenauer said.

She said other Oregon counties dependent on leisure and hospitality jobs have felt the same economic sting as Multnomah County. June unemployment rates were 5.9% in Deschutes County (Bend), and in three coastal counties, 6.2% in Tillamook, 6.8% in Clatsop and 7.7% in Lincoln.

Krumenauer also said other reasons for Multnomah County's lagging recovery were a steep decline in passenger traffic at Portland International Airport — it is recovering, though business travel has not — and slackened demand for manufacturing of transportation equipment.

A reversed trend

Oregon's 23 rural counties are leading 13 metro counties in job recovery rates.

Krumenauer said that trend is the reverse of what happened after the 2007-10 recession, from which it took seven years for Oregon to recover. The pandemic downturn was officially two months — not the two calendar quarters normally defined as a recession — but Oregon's unemployment rate shot up from a modern low 3.5% in March 2020 to an adjusted record 13.2% in April 2020.

During that period, Oregon lost about one of every seven jobs as businesses closed or curtailed operations. In the five Portland area counties, 153,000 jobs were lost, 14.4% of the total; in other counties classified as "metro," 92,000 jobs, 14.3%, and in the other counties, 35,000 jobs, 13.9%.

"We know this recovery has been happening much faster than what we have seen in the past," Krumenauer said. "But it also looks much different geographically so far than what we have seen in the past."

For rural counties, seven of every 10 jobs lost during the pandemic have been regained — slightly above the statewide average of two-thirds — while metro counties have regained five of 10 jobs lost. "Metro" counties under the Employment Department definition, in addition to the five in the Portland area, cover the cities of Salem, Eugene, Medford/Grants Pass, Bend and Corvallis.

The 13 metro counties accounted pre-pandemic for 86% of Oregon's workforce and 75% of regular claims from the state unemployment trust fund, which comes from payroll taxes on employers. The 23 rural counties accounted for just 14% of the workforce and 20% of claims.

But Krumenauer said regular unemployment claims from metro counties rose from 75% to 81%. Metro counties also accounted for 84% of claims from self-employed and gig workers who became eligible for new federal benefits during the pandemic.

Five rural counties — Crook, Harney, Malheur, Morrow and Wallowa, all east of the Cascades — have regained or exceeded their pre-pandemic job levels. But Krumenauer said that trend may stem from declining populations or aging workforces as many near retirement age. She said about one in four Oregon workers is age 55 or older; in Wallowa County, it's one in three.

"Those areas at or near full recovery from the pandemic recession were more likely to be already running up against those longer-term (worker) supply issues that exist beyond the pandemic," she said.

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