The October 2017 wildfires came several years into a bustling economic recovery from the Great Recession that brought North Bay joblessness down to low levels not seen in decades and rising wages. Just when businesses and communities were grappling with how to attract and keep workers, the firestorm added to the human and economic toll, sweeping away dozens of lives and over 6,400 homes in Sonoma, Napa, Mendocino and Lake counties.
A year later, the rebound from the fires has played out as expected, according to Robert Eyler, director of the Center for Regional Economics at Sonoma State University. The hot housing market, projected to have been short thousands of homes locally before the conflagrations, appears to have cooled slightly through the summer.
“We’re in this midland stage of seeing how much rebuilding is actually going to happen and how much effect that is going to have on local housing and the labor market,” Eyler said. “We still need some time to see how that will play out.”
Whether the rebuild will help or hurt those two markets likely won’t be known until next year or the one after, he said, noting that employment figures may be skewed by a number of survivors who are living off insurance payouts. The Press Democrat estimated as many as 7,000 relocated out of Santa Rosa after the fires, and potentially 1,300 left Sonoma County.
And the impact from the fires this year in Mendocino and Lake counties on the cannabis and wine industries remains to be seen, Eyler noted. Complicating that further is the seasonal-labor shortage that has been a challenge for North Coast farming for the past few years, amid changing U.S. border policy and higher-paying jobs in construction and the legal cannabis industry.
In March, Eyler pointed to projections of U.S. gross domestic product slowdown this year and the next two. Three increases so far this year by the Federal Reserve in short-term interest rates may tamp down business activity nine to 12 months from now, as those rate adjustments trickle down to the 12-month Treasury note rates that impact business lending, Eyler said last week.
Any economic dip will first happen at the national level then state and local, he said. “It will not be something that will happen at the Sonoma County level first.”
One year later: How we've changed
This is part of a report on the one-year anniversary of the October 2017 wildfires that forced tens of thousands to flee quickly and destroyed thousands of homes. Read more personal accounts from business and civic leaders as well as updates on the economic recovery.