Orange County’s unemployment rate is hovering around 9 percent as the coronavirus pandemic’s economic fallout continues to be felt by residents across the county — and before a potential second wave this winter.
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Leisure and hospitality industry employment — hotels and theme parks — is down roughly 30 percent, according to the latest report from the state’s Employment Development Department issued just a few days ago.
That means there’s nearly 67,000 people who aren’t working at Disneyland, Knott’s Berry Farm, resort hotels and other businesses that tourists spend money at before the pandemic hit in March, according to the latest report from the employment department.
The backlog of unemployment checks and claims created such an outcry from Californians that Gov. Gavin Newsom ordered a “strike team” to investigate the situation at the employment department.
The team issued a scathing report late last month slamming the department on its handling of the economic crisis. Investigators found the unemployment’s call center demand is over 1,000 percent greater than pre-pandemic levels.
There’s been a steady push to reopen Disneyland by OC Supervisors and a host of state legislators and city mayors.
The theme park might not reopen until next summer after county health officer Dr. Clayton Chau said he doesn’t expect OC to move into the least restrictive tier by then, which is required by state health officials before Disneyland can reopen.
Unions representing Disneyland resort workers, including UNITE HERE Local 11, sent Newsom letters urging him to allow theme parks to reopen in the Orange Tier, which is the third most restrictive tier.
OC currently sits in the Red Tier, which allows a limited number of people inside malls, churches, gyms, restaurants, movie theaters and a host of other retailers.
UC Irvine economist Ami Glazer said even if Disneyland does reopen, that may not translate into a big economic gains for Anaheim and Orange County because airline travel across the country is down by nearly 50 percent.
“Let’s suppose that Disneyland opens and it’s roughly one-third of capacity, but my guess is that most people who would come would be from Southern California because there’s evidence people aren’t confident to fly,” Glazer said in a Thursday phone interview.
He also said that local spending is still down over 8 percent compared to January, even after rebounding from the 35 percent drop in April.
“Some people would come and it would be mostly locals so there wouldn’t be as much benefit to the economy in Southern California,” Glazer said. “People aren’t traveling far, they don’t need a hotel.”
Hotel taxes play a key role in driving city tax revenue, like the resort area in Anaheim.
Glazer said while bringing locals back into Disneyland would help the company’s bottom line, it will take away spending from other areas of the local economy.
“And the other problem is if people spend money on going to Disneyland they’ll spend less money on other things,” he said.
UC Irvine epidemiologist and public health expert Andrew Noymer said it would make sense to reopen Disneyland in the Orange Tier because so many other indoor businesses, like the South Coast Plaza, are open.
“So, I agree 100 percent that any county that’s in the Red (like OC) shouldn’t have the theme park open. I agree 100 percent that when you’re in the yellow, you can safely open the theme parks. I have this complicated view about orange,” Noymer said in a Wednesday phone interview.
He said there needs to be some consistency in the public health guidelines.
“I actually think they probably can open in Orange, but there’s some caveats there. One of the things is there’s been lots of talk about beaches,” Noymer said, referring to the beach debate that raged before Memorial Day weekend.
“Well these theme parks are outside. I think we have to be kind of consistent. The theme parks are proposing to reopen with masks and reduced capacity,” Noymer said. “They’re cutting down on the lines and everyone’s masking etc, etc. You won’t find me there, personally, but I’m taking a very conservative approach.”
“If you can go to the beach, why can’t you go to Disneyland?” Noymer said. “If you can all pile into Trader Joes, then why can’t you go to Disneyland? The parks have sworn upon a stack of bibles that they’re going to be enforcing masks”
Meanwhile, many jobless residents have to fight for their unemployment checks and for food because the employment department has been overwhelmed and failed to keep up with the increased demand, while local food banks were on track to lose federal assistance.
On Tuesday, the Orange County Board of Supervisors unanimously voted, without much discussion, to extend an agreement to financially support local food banks.
The $3 million in Coronavirus federal relief money will be administered by the Social Services agency to Second Harvest Food Bank and the Community Action Partnership of Orange County. The OC Food Bank is a subsidiary of the Community Action Partnership of Orange County.
The food banks will use the money to get food to pantries throughout the count and these pantries will give the food out for free to anyone in need.
The supervisors’ decision came less than a week after the Voice of OC reported on the food deficiency expected to hit the county next month as unemployment remains high and federal aid for food banks winds down.
This will be the second round of coronavirus relief funding the county has given the Second Harvest and the Community Action Partnership. In May, supervisors voted to give food banks an initial $3 million.
Since the pandemic began in March, the virus has killed 1,440 county residents out of 58,010 confirmed cases, according to the county Health Care Agency.
For context, Orange County has averaged around 20,000 deaths a year since 2016, according to state health data. According to those same statistics, the flu kills about 543 OC residents annually.
As of Friday, 162 people were hospitalized for the virus, including 58 in intensive care units.
Noymer and other public health experts have said they expect a second wave of coronavirus infections in the coming months.
“There’s going to be a second wave. There’s second waves in Europe, second waves happening in other parts of the U.S. There’s going to be a second wave. The coronavirus isn’t over yet,” Noymer said.
Noymer also said, based on his modeling, that OC will see its 2,000th death by early next year.
“This epidemic is going to have waves — plural.”
Here’s the latest on the virus numbers across Orange County from county data:
Spencer Custodio is a Voice of OC staff reporter. You can reach him at [email protected]. Follow him on Twitter @SpencerCustodio