Unlike in Recent Recoveries, the Southeast Lags the Nation

Employment in the Southeast declined more and recovered more slowly after the end of the Great Recession than in the nation as a whole. The second half of 2013 brought progress, as the region's two largest states—Florida and Georgia—led steady employment gains across the region.

Still, the Southeast ended the year with fewer jobs than it had before the recession. And the Southeast's labor market had more ground to make up than the national jobs market did. As 2014 began, the country had regained nearly 90 percent of lost jobs; the Southeast had reclaimed only 64 percent.

The region's labor market was weaker by other measures as well. At the end of 2013, the labor force participation rates in all six southeastern states were below the national rate of 63 percent. Broader measures of unemployment were also worse in most of the region. For example, only Alabama and Louisiana posted lower average U-6 unemployment rates than the country as a whole throughout 2013.

This recovery has been different. The Southeast weathered the downturns of the early 1990s and 2001 comparatively well, losing a smaller portion of jobs and recovering those jobs more quickly than the nation. Steady in-migration in the 1990s and early 2000s strengthened the southeastern economy and labor market. Population growth fueled housing construction, commercial real estate development, and related industries, generating large numbers of jobs.

But the Great Recession hit the Southeast's building sector especially hard. Florida alone lost more than half of its construction jobs, and a vast majority of those losses have not been recouped. Manufacturing was another sector in which the Southeast suffered severe employment declines. In fact, job losses in the construction and manufacturing sectors accounted for nearly the entire gap between the Southeast's nonfarm employment at the end of 2013 and the prerecession peak during 2007.

Those two sectors added jobs during 2013. Among the major economic sectors, only government did not add jobs last year. Meanwhile, the aggregate unemployment rate for the region ended the year at 6.7 percent, down from 7.8 percent a year earlier and well below the peak of 10.5 percent in January 2010.