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Arkansas Employment and Unemployment – August 2010

The latest information on Arkansas employment and unemployment was released by the U.S. Bureau of Labor Statistics and the Arkansas Department of Workforce Services this morning.  The report showed that the unemployment rate ticked up one-tenth of one percent to 7.5%.   The household survey showed that the number of unemployed persons rose by over 1,800 in August (seasonally adjusted).  

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics
Payroll employment data also indicated labor market weakness in August.  Seasonally adjusted data showed a decline of nearly 11,000 jobs.  The losses were most prominent in Education and Health Services, and Government.    Declines in Government jobs were primarily in the category of Federal employees, and most likely represent the layoff of temporary Census workers.  According to the report from the Arkansas Department of workforce services, the losses in Education and Health were primarily in the education category.
Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

The information in the employment report for August indicates a slowdown in the the pace of economic recovery in Arkansas.  Nevertheless, there is no reason to believe that it represents anything more than a temporary setback.  Total employment remains above the level of December 2009 and above the level of a year ago.  Several sectors continue to show net job growth over the past several months.  Sectors that have shown positive growth over the first eight months of the year include construction; manufacturing; trade, transportation, and utilities; and education and health services.

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*Seasonally adjusted data for nonfarm payroll employment, reported in a format compatible with the monthly press release from the Arkansas Department of Workforce Services, are available here
Table – Seasonally Adjusted NFPE.

Arkansas Employment and Unemployment – July 2010

 The latest information on Arkansas employment and unemployment was released by the U.S. Bureau of Labor Statistics and the Arkansas Department of Workforce Services this morning.  The report showed encouraging signs of continuing improvement in the Arkansas labor market.  The unemployment rate ticked down one-tenth of one percent to 7.4%.   The household survey also showed that the number of unemployed persons fell by 1,800 in July, dropping below 100,000 for the first time since May 2009.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

Analysis of the payroll survey is complicated by seasonal patterns.  Without seasonal adjustment, the data show employment down by nearly 11,000 in July.  However, as shown in the chart below, July is typically a low-point in the recurring seasonal cycle diplayed by employment data.  (See Seasonally Adjusted Unemployment Rates for Arkansas MSAs.)  After seasonally adjusting the raw data, the statistics from BLS show that payroll employment rose by 3,600 jobs.  Since the end of 2009, payroll employment has increased by nearly 16,000 jobs.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

The increase was broad-based, with increases in every major sector except financial services and government.  Employment in manufacturing showed its 7th consecutive monthly increase.  Trade, transportation and utilities was up by 900 jobs, and business and professional services rose by 1,400.  Education and health services continued to expand, adding approximately 2,400 jobs in July.  The decline in government employment can be primarily attributed to layoffs of temporary census workers.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

Typical summer doldrums aside, the July employment report provides additional evidence that labor markets in Arkansas are steadily improving.

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*Seasonally adjusted data for nonfarm payroll employment, reported in a format compatible with the monthly press release from the Arkansas Department of Workforce Services, are available here
Table – Seasonally Adjusted NFPE.

Metro Area Employment and Unemployment – June Update

June data for metro area employment and unemployment came out earlier this week (see Metropolitan Area Employment and Unemployment Summary from the BLS).  According to the raw numbers—not seasonally adjusted—unemployment rates were unchanged or higher in each of the state’s metropolitan statistical areas (MSAs).   However, June is typically a month in which unemployment ticks upward for purely seasonal reasons.   One factor:  teachers and students are off for the summer, and students in particular are reported as being unemployed if they are seeking, but fail to find summer jobs.** 

After accounting for these recurrent patterns, seasonally adjusted statistics paint a much brighter picture.  Unemployment rates fell in every one of the state’s MSAs.  In many cases, the declines were substantial.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

Employment statistics for June (seasonally adjusted by the BLS) showed that payrolls fell in most of Arkansas’ MSAs.  Employment was down by 0.1% in Fayetteville, down 0.9% in Fort Smith, down 0.6% in Little Rock, down 0.4% in Memphis and down 1.1% in Pine Bluff.   Employment was unchanged in Jonesboro, but was up by 0.3% in Hot Springs and up 0.2% in Texarkana.

Cumulative job losses in the state’s MSAs since the start of the recession have varied considerably.   The chart below shows the percentage decline for each MSA since December 2007.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

Jonesboro has lost the fewest jobs:  total losses reached a peak of 2.2% in April but have recovered over the past two months.  Similarly, Texarkana has come back from a cumulative loss of 3.3% in December of last year to a total loss of only 1.2% as of June.  Hot Springs losses totalled 6.7% in April, but have bounced back to within 3.8% of the December 2007 level.  Employment in the remaining MSAs is at or near recent low points, having yet shown little sign of recovery.

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**The June 2010 issue of Arkansas Labor Market, from the Department of Workforce Services, includes a feature article describing some of the reasons that employment data show seasonal fluctuations.

Arkansas Employment and Unemployment – June 2008

The latest information on Arkansas employment and unemployment was released by the U.S. Bureau of Labor Statistics and the Arkansas Department of Workforce Services this morning.  The reports indicate that the employment situation in Arkansas is continuing to improve.

The unemployment rate dropped by two-tenths of a percent, falling to 7.5 percent in June.  The number of unemployed fell by 4,100 to 100,943.  This is the lowest reading since the number of unemployed first topped 100,000 in June of 2009.   The unemployment rate would have fallen further had it not been for a contraction in the size of the labor force.   The labor force declined by more than 8,000 in June, following three months of previous declines.  The most obvious explanation for this phenomenon is an increase in the number of “discouraged workers” who have given up looking for employment–at least for the time-being.   Overall, however, the news from the June employment report should serve as a reason for more encouragement going forward.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

The payroll survey for June showed a healthy rate of job-creation:  Nonfarm payroll employment increased by 6,000 jobs (seasonally adjusted).  Since December of last year, payroll employment has risen by 11,400 and it is up by 4,200 from a year ago.  From the low-point for employment measured in February 2010, the number of jobs has increased by more than 15,000.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

Recent data have shown employment gains in some of the key sectors for the Arkansas economy:  Manufacturing employment was up by 1000 jobs, and has now increased for five consecutive months.  Employment in Trade, Transportation and Utilities edged up by 800 jobs in June, recovering the job losses from earlier in the year.  Employment in Education and Health services resumed a healthy pace of job creation, increasing by 4,500 jobs in June.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

Interpreting the growth in public sector employment is complicated by seasonal patterns and changes in the Census Bureau’s employment of temporary workers.  On a not-seasonally-adjusted basis, government employment was down by 4,700 jobs, with an 1,800 decline in Federal Government employment largely attributable to the winding-down of Census Bureau employment.  However, much of the decline in state and local government employment was related to typical fluctuations in public school employment.  After taking account of this school-year phenomenon, seasonally adjusted employment by government entities increased by 1,800  (with federal government employment down by 2,100 jobs and state & local employment up by a total of 3,900 jobs).

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*Seasonally adjusted data for nonfarm payroll employment, reported in a format compatible with the monthly press release from the Arkansas Department of Workforce Services, are available here
Table – Seasonally Adjusted NFPE.

Is the U.S. Economy Facing a “Double-Dip” Recession?

Earlier this week, I was quoted on Talk Business.net as questioning the relevance of a “double-dip” recession.  There are several reasons that I take that position.

First, The Business Cycle Dating Committee at the National Bureau of Economic Research has laid out clear criteria for defining a recession.  They cover a broad range of economic measures, including production, income and employment–not just quarter-to-quarter movements in GDP.  In fact, the Business Cycle Dating Committee has never defined or declared that we’ve seen a double dip recession.  The chair of the Committee, Dr. Robert Hall has recently referred to the recessions of 1980 and 1981 as the closest thing he’s seen to a “double-dip,” yet the Committee decided at the time to define two separate recessions  (See A ‘Double-dip’ Recession Defined).

Another reason that I question the current danger of a double-dip recession is that most economic indicators continue to show a moderate rate of recovery in the economy.  The buzz about a double dip recession seems to have intensified following the release of the June employment report, which was somewhat weaker than expected.  It is never wise to put too much emphasis on one month’s data, and in this case it can be misleading.  As shown in the chart below, private-sector employment has shown increases in each of the past six months. 

Source:  Bureau of Labor Statistics.
Source: Bureau of Labor Statistics.

Total employment has been subject to fluctuations in Government employment due to the hiring of temporary workers by the Census Bureau.  When the report on May employment came out, many media sources pointed out that the strong monthly showing was entirely due to Census hiring, with private sector employment falling.  Subsequent revisions to the data now show that private sector employment did increase in May, albeit only slightly.

One of the reasons that the June employment report looked so discouraging was that the Census Bureau laid off many of the workers it had hired in earlier months, so that total employment declined, on net.  Yet private sector hiring showed its sixth consecutive month of increase.

Evidence from previous recessions–particularly the two most recent recessions–shows that employment tends to be a lagging indicator, picking up only slowly during the early stages of an economic expansion.  So far, we’ve seen total growth of about 900,000 jobs during 2010.  This is not consistent with a robust rebound, but it does indicate a clear sign of a turnaround in the job market. 

Meanwhile, the other key indicators that are considered by the Business Cycle Dating Committee–industrial production, real income growth, and total sales–are all showing patterns of renewed strength since the middle of 2009.  The economy is recovering, but it’s looking like this recovery will follow a pattern similar to the last two “jobless recoveries.”

Arkansas Employment and Unemployment – May 2010

The latest information on Arkansas employment and unemployment was released by the U.S. Bureau of Labor Statistics and the Arkansas Department of Workforce Services this morning.  The reports show that the unemployment rate dropped from 7.8% to 7.7% in May (seasonally adjusted).  This is the first decline since March 2008.  More significantly, the number of unemployed persons fell for the second consecutive month. Over the months of April and May, the number of unemployed has fallen by over 2000. 

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

Nonfarm payroll employment report also contained positive news:  the number of jobs was up by 2800 in May (seasonally adjusted)*. 

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

Gains were particularly notable in some of Arkansas largest sectors:  Manufacturing employment was up by 900; Trade, Transportation and Utilities was up by 2100; and Education and Health Services was up by 900.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

Government employment was also up sharply +4200 jobs.  Mirroring the pattern seen in the national data for May, many of these jobs were related to temporary hiring by the Census Bureau.  Federal Government employment in Arkansas was up by 4600 in May.

Since December of 2009, employment is up by 6300 jobs (including 6000 in manufacturing).  4000 of those jobs are government-related, with an increase in private-sector employment of 2300.

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*Seasonally adjusted data for nonfarm payroll employment, reported in a format compatible with the monthly press release from the Arkansas Department of Workforce Services, are available here
Table – Seasonally Adjusted NFPE.

Arkansas Employment and Unemployment – April 2010

The latest information on Arkansas employment and unemployment was released by the U.S. Bureau of Labor Statistics and the Arkansas Department of Workforce Services this morning.  The unemployment rate held steady in April at 7.8 percent, while the number of employed declined slightly from March.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

Although the unemployment rate itself was unchanged, the household survey showed that the number of unemployed people declined from 197.1 thousand to 106.3 thousand.  This was the first monthly drop in the number of unemployed since March of 2008.  This drop failed to have an impact on the unemployment rate, however, since the number of employed reported in the household survey also declined.

The payroll survey also indicated a slight decline in the number of jobs.  Total nonfarm payrolls were down by approximately 1600 jobs in April (seasonally adjusted).*  The April decline follows a sharp increase we saw in March (up 8900 jobs, revised).  In terms of longer-term performance, therefore, the April decline does not appear to signal any change in the trend of employment growth.  For the first four months of the year, nonfarm payrolls have increased by 3600.   Employment is stabilizing, but there is no clear indication (yet) of a resumption of long-term job growth. 

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

The decline in nonfarm payroll employment in April was largely attributable to service-providing sectors.  Goods-producing sectors had been very hard-hit during the recession so recent increases in  manufacturing employment, in particular, have represented welcome news.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

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*Seasonally adjusted data for nonfarm payroll employment, reported in a format compatible with the monthly press release from the Arkansas Department of Workforce Services, are available here
Table – Seasonally Adjusted NFPE.

Update on Metro Area Employment and Unemployment

Metro area unemployment rates for March 2010 were released last week by the Bureau of Labor Statistics and the Arkansas Department of Workforce Services.  Over the first three months of 2010, seasonally-adjusted unemployment rates rose in all of Arkansas’ Metropolitan Statistical Areas (MSAs).  The Pine Bluff MSA continued to register the highest unemployment rate in the state: 9.9% in March–slightly above the national average of 9.7%.  All of the state’s other metro areas were below the national average, with the lowest rate being 6.6% in the Fayetteville-Springdale-Rogers MSA.

Sources:  Bureau of Labor Statistics, Institute for Economic Advancement
Sources: Bureau of Labor Statistics, Institute for Economic Advancement

Nonfarm payroll employment was up sharply in the statewide data for March (see previous post).  For the state’s metro areas, employment was unchanged or up slightly in six of the seven MSAs.  Only Texarkana showed a decline for the month. However, Texarkana had shown increases earlier in the year and it is the only MSA in Arkansas with positive employment growth, on net, over the most recent three months (from December).

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

Compared to March of last year, employment in March 2010 was down in all of Arkansas metro areas.  In percentage terms, Jonesboro showed the smallest decline:  down by only -0.6 percent.  Having shown a sharp decline in the first three months of 2010, employment in Hot Springs is down by 3.2 percent from a year earlier.

Arkansas Employment and Unemployment – March 2010

The March figures for Arkansas employment and unemployment came out on Friday.  The news was mixed:  The household survey showed higher unemployment while the payroll survey indicated strong employment growth, particularly in the goods-producing sectors.

The unemployment rate ticked up again, from 7.7 percent in February to 7.8 percent in March.  The household survey indicated an increase in the number of unemployed persons by nearly 900, and a decline in the number of employed by approximately 7,800.   Hence the unemployment rate reflected both an increase in unemployment and a decline in the labor force.

In contrast, the payroll survey showed a sharp increase in employment, up by nearly ten-thousand jobs (seasonally adjusted). 

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

Goods-producing sectors showed notable gains:   Construction employment was up 3,100 and manufacturing employment rose by 1,600.  Month-over-month increases were also reported in information services, professional and business services, other services, and government.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

In addition to the strong payroll growth in March, the figures for February were revised upward by 1,000 jobs — it turns out that February was slightly less “dismal” than previously reported.  Over the past six months (from September 2009 to March 2010) employment has increased in construction, manufacturing, and several service-providing sectors.

It is not unusual for the household data and the payroll data to give conflicting signals, particularly on a month-to-month basis.  In addition to having different sources, the two surveys differ in the way that they measure agricultural employment, self-employment, and multiple job-holders (among other things).  

The payroll figures show signs of recovery in employment growth for some sectors.  Nevertheless, the increases are not (yet) sufficient to reduce a stubbornly-high unemployment rate.

Arkansas Employment and Unemployment – February 2010

“… a dismal report”

The February report on state-level employment and unemployment was released by the U.S. Bureau of Labor Statistics and the Arkansas Department of Workforce Services this morning.  Set against the backdrop of expectations for a stabilizing employment situation, the Arkansas report is disappointing at best. 

Household survey

The headline news was an increase in the unemployment rate from 7.6 percent in January to 7.7 in February.  This is not a substantial change, but the upward creep is unwelcome news.  Changes in the underlying components of the unemployment rate highlight the weakness:  The number of employed was down by 1,142 and the number of unemployed was up by 1,285.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

 

Payroll Survey

Not seasonally adjusted, nonfarm payroll employment in Arkansas fell only slightly in February (down by 300 jobs from January).  However, as shown in the chart below, January is usually a low point in the seasonal cycle of employment, with February tending to show a rebound as we head for the spring months.  After seasonal adjustment, the decline in February was substantial:  down 7,300 jobs.  In percentage terms, this represents a decline of 0.6%–the third largest drop among the 50 states in February.  This is a larger one-month loss than any we observed for Arkansas during the depths of the 2008-09 recession.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

The table below summarizes the change in employment by sector.  Employment was down in nearly every sector in February.  The largest declines were in Trade, Transportation and Utilities; Professional and Business Services; and Other Services.  Construction employment continues to fall.  In February, construction employment fell below 50,000 (seasonally adjusted) for the first time since January 1999.

Source:  Bureau of Labor Statistics
Source: Bureau of Labor Statistics

There were two relatively positive aspects of the report.  First, the data from January were revised to show a larger employment increase than previously reported.  As a result, some service-sector categories have shown positive growth, on net, over the first two months of the year.  The second positive element of the February report was manufacturing employment, which was up by 1,500 jobs.  Manufacturing employment has been experiencing a protracted period of decline.  The February increase provides further evidence that the sector is stabilizing.

One should never put too much emphasis on a single month’s observations—and the numbers released this morning are subject to future revision.  Nevertheless, taken at face value, today’s data-release represents a dismal report.