In February, San Francisco's unemployment rose to 8.3% on a non-seasonally-adjusted basis. While this does represent an increase of 0.3% from the January figure, both the City's and State's unemployment rose a slower amount than we have seen in the past several months. It is premature to speculate on when unemployment might peak locally, particularly since employment is a lagging economic indicator. Nevertheless, we may be at the end of the sudden downturn that started last fall, and entering a period of more gradual decline.

 Since temporary workers are often the first to be laid off during a downturn, and the first to be hired in a recovery, a key jobs indicator to watch is employment in the employment services industry. The monthly drop of 1.5% is still large given the absence of seasonal layoffs in February, and is another reason for continued caution about the state of the local job market.

Other economic indicators are also showing a slowing rate of decline, without yet showing signs of a bottom in key markets. Median housing price is a volatile and imperfect indicator, but it is showing a rebound from January and a slower year-over decline than the previous month. One-bedroom asking rents are also showing slower declines than in recent months past.