Mark Farrell’s background as a businessman has appeared front-and-center in his short mayoral reign, and this week he’s using his position of power to prepare the city for an inevitability: the next recession. On Tuesday, Farrell issued an executive order mandating that city officials meet regularly to monitor and plan for potential signs of an economic downturn — something his office claims is a “first-in-the-nation policy.”
“We are enjoying unparalleled economic prosperity in our city, but we cannot forget the lessons learned from the Great Recession,” Farrell says, referencing the financial collapse of 2008. “There is not a question of if the next downturn will happen, but when. As mayor, I have a duty to prepare our city and determine what steps we will need to take to recover.”
While Farrell and his stock-watching tactics are pushing this issue to the fore, he’s following in Mayor Ed Lee’s footsteps. In 2016, Lee established the city’s first Economic Resiliency Plan. Based on research done by consultants who put it together, the city could see a loss of between 15,000 and 54,000 jobs during another downturn, which (in the worst-case-scenario) would push unemployment up to an uncomfortable 9.4 percent.
It sounds serious, and it is, but it’s not something San Francisco hasn’t experienced before. Between 2008 and 2010, 40,000 jobs were lost citywide. But in the eight years since, we’ve recovered with a whopping 189,000 jobs added, which has lowered our unemployment rate to 2.4 percent.
Still, it’s a good reminder to fill up the city’s rainy day reserves. City Hall has now squirreled away $499 million for emergencies should the recession hit as badly as last time. And it’s not done yet — that’s only 10 percent of what’s recommended in the aforementioned Plan.
“Despite our strong recovery, the pain of the Great Recession is still fresh for many San Franciscans,” said Todd Rufo, director of the city’s Office of Economic and Workforce Development. “The city has a responsibility to ensure that when the next downturn hits, we are ready.”