Strong gains in the South Bay's tech sector cemented Silicon Valley's leading role in the Bay Area and California recovery, a state jobs report released Friday shows.

The unemployment rate dropped in Santa Clara and San Mateo counties to 9.7, from 9.9 percent in April, , the state Employment Development Department reported. San Mateo County's unemployment rate remained at 8.1 percent. It was the sixth straight month the county's jobless rate has been below what it was the year before. The county consistently enjoys one of the lowest jobless rates in the state.

"High tech is doing well in the South Bay," said EDD labor market consultant Ruth Kavanagh.

The valley's "information" sector, which includes Internet companies, has now exceeded the level of jobs it had at the peak of the housing bubble, and even prior to the dot-com bust.

The San Jose metro area added 1,900 non-farm jobs in May, unadjusted for variations in seasonal hiring, much of that growth in the computer, computer software and Internet industries. The total non-farm growth is less than the 21-year average for May, but the upward trend in tech is clear.

The tech-heavy professional and business services sector grew by 1,100 jobs, well above its average 400-job gain between April and May over the prior 21 years, the EDD said.

All this has rapidly expanding companies scrambling to hire increasingly scarce engineering talent, and starting to add personnel in sales and marketing.


"The economy is in a hyper growth phase," said Scott Schwarzhoff, vice president of hiring and marketing at Appcelerator.

Last October Appcelerator, which makes a popular mobile development platform, had 17 employees. It now has 70 and plans to hire 50 more this year, said Schwarzhoff. It has moved twice, and is now in a 25,000 square foot building in Mountain View.

Companies in mobile, social, cloud and "contextware" computing are drawing on "increasingly tighter and tighter source of pool of talent," Schwarzhoff said. The demand is drawing people to the valley from out of state and from other countries, he said.

Lee-Anne Farley, director of talent acquisition at San Leandro-based TriNet, expects the demand for talent to continue for the rest of the year.

"There's a demand for positions and not enough top talent to fill them," she said. "The potential talent out there is being incredibly choosey.

TriNet is a national human resources outsourcing company.

Brad Kemp of Beacon Economics said the Bay Area is leading the state out of the after-effects of the recession, with soaring demand for the high tech products it makes.

Much of that economic growth is in the computer and software products that allow employers to hire fewer people, he said. That means many unemployed people are still struggling to find good jobs again.

He said the San Jose metro area - which combines San Benito and Santa Clara counties - showed a slight dip in jobs when the data is adusted for seasonal variations in hiring. But that dip follows eight consecutive months of employment gains, he said.

"I think what we're seeing is a rebound. We're seeing above average growth."

The San Francisco metro area, which includes San Mateo County, saw gains in the area's large leisure and hospital industry, while construction eked out a small gain fore the second month in a row.

California shed 29,200 jobs in May, but its unemployment rate fell to 11.7 percent from a revised 11.8 percent in April.

That was the largest job loss in the nation, but an economist with Beacon Economics said the long-term trends are toward an increasing numbers of jobs.

"Don't be fooled," said Kemp of Beacon. April's reported gain of 8,900 jobs has been revised upward to 14,900 jobs, he said. "There's a battle going on between those industries and areas that haven't turned the corner, and others that have," he said. "We get the net results."