Yet another analysis points out the well-reported state of affairs that downtown San Francisco’s economic recovery from the pandemic is awfully sluggish, but this one purports that we’re in last place among 62 North American cities.
It’s pretty common these days for some pro-business Bay Area think tank to put out a study about the death of downtown San Francisco since pandemic restrictions have largely been lifted, and a hundred thinkpieces have been penned on the topic. Every single one of these thinkpieces and analyses fails to take into account that San Francisco also had the lowest COVID-19 death rate of any U.S. city, and by a substantial margin at that. So if we’re suffering hundreds or thousands fewer deaths than other same-size cities, but having a slower economic recovery, call me crazy but that’s a trade-off I would take any day.
But the Chronicle reports one of these new analyses ranks San Francisco dead last among the 62 largest North American cities in terms of downtown activity since COVID-19 restrictions were lifted. That comes from a UC Berkeley Institute of Governmental Studies analysis that studied the largest U.S. (and Canadian) cities’ mobile phone-ping data — measuring cellphone activity in SF's downtown quadrant in 2019 vs. 2022 — and found that there’s only 31% as much human activity in downtown SF compared to pre-pandemic.
“In this research, we examine visits over time to 62 downtown areas using mobile phone data, comparing the most recent activity (as of November 30, 2022) to pre-pandemic levels (in 2019),” the study says. “We find wide variation in the extent of recovery, with activity ranging from a low of 31% of pre-pandemic levels in San Francisco to a high of 135% in Salt Lake City.”
In contrast to other studies which use data from public-transit exits or car traffic, this study specifically isolates the number of cellphones in an area at a given time.
You can see the data represented in their graph above (“RQ” means “Recovery Quotient”). And a small number of mid-sized cities, like the aforementioned Salt Lake City, plus Bakersfield and Fresno, actually have more bustling downtowns now than they did pre-pandemic.
There are a few reasons SF is in last place, but the big one is our very large tech sector that is still often working from home. “In general, places with a higher share of employment in knowledge-based industries and occupations and/or more highly paid workers, are likely to shift towards remote work," the study says. “Surveys suggest that shift will be permanent for up to half of the workforce in cities that are large and congested (e.g., New York), or powered by the tech sector (e.g., San Francisco).”
The study’s lead author, UC Berkeley professor Karen Chapple, tells KRON4 that "San Francisco suffers from an economy that isn’t very diverse. It does great when there is a tech boom, but right now it’s really hurting the city’s resilience."
Certainly the tech office vacancy rate is dire, as we learned this week that there are currently 15 Salesforce Towers worth of empty offices in San Francisco. Commercial real estate brokerage CBRE quotes the city’s office vacancy rate hitting a record high 27% at the end of last year.
“San Francisco set itself up for this,” Chapple explains to KRON4. “It zoned out residential and doubled down on commercial offices in the downtown zip code. That’s what it decided this area of the city should be and it was the wrong bet.”
She’s probably correct on that, and we ought to be moving faster on converting offices to housing. But there are more figures to consider. The Chamber of Commerce and business lobby set also fail to take into account that San Francisco unemployment is currently at a fabulously low rate of 2.3%, which by the way is lower than it was pre-pandemic. So maybe those people working in downtown cafes, bánh mì shops, and Financial District bars have found other work?
Or sure, maybe they moved to Fresno or Bakersfield, whose downtowns are more bustling than the Before Times. But Bakersfield currently has 6.8% unemployment (nearly triple that of SF!), while Fresno has 6.6% unemployment. So that may be some important context when the big-business think tanks tell San Francisco that it supposedly has the worst downtown economy in the nation.
Image: Clay Elliot via Unsplash