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Following heated gains last year, the outlook for the East Bay includes continued growth but at a slower pace than recent highs. Unemployment, which stood at a post-recession low of 4.1% in March 2016, rose to 4.3% in October 2016 as more people entered the regional labor force, enticed by better labor conditions and wage gains. Almost 36,900 job seekers entered the East Bay labor force between October 2015 and October 2016, a 2.7% expansion. This contributed to nonfarm employment growth that was also 2.7% over the same period.
The largest employment gains came from the Leisure and Hospitality (+6.2% YTY) and Education and Health (+5.1% YTY) sectors, which accounted for half of all annual employment growth in the region from October 2015 to October 2016. The Construction sector, however, continues to outpace all other sectors by growth rate, adding 4,600 jobs and expanding by 7.2% year-over-year, as of October 2016. Rapid growth in this sector is a reflection of the numerous commercial and residential projects being developed across the East Bay as firms and individuals are drawn to the region by relatively affordable rents and real estate.
EIndustries that require high land use are moving into the East Bay because they are being priced out of other parts of the Bay Area. In recent years, for example, the region has been bucking statewide declines in the Manufacturing sector. While Manufacturing employment overall fell 1.2% over the last 12-month period ending in October of 2016, advanced manufacturing clusters have continued to expand in the Fremont and Newark areas. Tesla Motors, Inc. recently announced plans to add...