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The Atlanta Fed's SouthPoint offers commentary and observations on various aspects of the region's economy.

The blog's authors include staff from the Atlanta Fed's Regional Economic Information Network and Public Affairs Department.

Postings are weekly.


July 9, 2014

Southeastern States Mind the (Skills) Gap

During the past few years, we have heard from a significant number of regional business contacts about the challenges they experience filling certain positions and concerns about a skills gap facing the Southeast. We heard this from various industries, most often about engineering, construction, and IT jobs. The most recent Southeastern Insights mentions this widespread issue.

This skills shortage situation is not unique to the Southeast. The U.S. Chamber of Commerce Foundation published a state-by-state analysis last month measuring performance in a number of areas that contribute to economic prosperity. Their key conclusion reiterates our contacts’ concerns: that mounting skilled-labor shortages are on the horizon to such an extent that they may soon hinder economic growth. According to the study, the current skills gap dilemma is expected to grow substantially as baby boomers retire.  

Fortunately, there’s a bright side: many states have recognized this situation and have taken steps to address the ostensibly approaching workforce crisis. Many of our contacts from both private and public sectors pointed to joint initiatives created by states and businesses designed to confront and abate the situation; which the U.S. Chamber of Commerce Foundation study says is essential to closing the gaps. Below is a sample, extracted from the study, of some of the efforts Sixth District states have taken:

Alabama

  • In 2013, the state launched a College and Career Ready Task Force charged with identifying ways to better prepare students for the workforce by training them in the skills demanded by growing industries across the state.
  • New and expanding businesses can get workforce development services through the Alabama Industrial Development Training program, which offers services to businesses in need of skilled workers, including preemployment selection and training, leadership development courses, and third-party process improvement assessments.
  • The Alabama Technology Network provides skills training for the manufacturing and high technology workforce. The network connects businesses to the portfolio of training resources and programs provided by the state’s colleges and universities, offering services through regional centers.
  • The Go Build Alabama initiative works to attract talented workers to construction and skilled trades.

Florida

  • Quick Response Training enables new and expanding businesses in need of training to partner with community colleges and other educational institutions in the state to develop and deliver workforce training programs.
  • The Incumbent Worker Training program supports training the existing workforce to enhance and maintain competitiveness.
  • The Career and Professional Education Act guides Florida’s efforts to diversify its economy and develop a more skilled workforce by encouraging collaboration among education, industry, workforce, and economic development stakeholders from across the state.

Georgia

  • In early 2014, the state approved a $44.7 million Science Learning Center on the University of Georgia’s South Campus, providing state-of-the-art facilities aimed at expanding the pipeline for students in science, technology, engineering, and math (often referred to collectively as STEM).
  • Groundbreaking also took place for the Georgia BioScience Training Center, which will support training for companies that choose to locate within the state. Georgia Quick Start, the state’s job training program, will build and operate the state-of-the-art biotech training center.

Louisiana

  • Via the Small Business Employee Training Program, employers can receive up to $3,000 to defray the costs of off-the-shelf training programs for an existing employee.
  • The Louisiana Workforce Commission established Workforce Partners to recognize businesses that have committed to building a “job ready” workforce in the state through support and training.
  • The Strategies to Empower People program provides access to job training, job readiness support, vocational education programs, and a variety of other skills-development services for those receiving government assistance.

Mississippi

  • The Workforce Investment Network consists of more than 60 training and employment centers around the state where employers and job seekers can access services like training, job postings, on-the-job training programs, employment screening services, and job placement assistance.
  • The Mississippi Development Authority also maintains a team of workforce specialists who work with colleges, businesses, workforce development professionals, and other stakeholders to identify resources useful to a particular business. The authority also builds partnerships to pursue needed training services.
  • The University of Mississippi maintains a Professional and Workforce Development program, offering online enrichment courses, certification programs, and outreach services, bringing tailored training programs directly to the employer.

Tennessee

  • The Tennessee Job Skills grant program offers support to technology companies that create “high-skill, high-wage” jobs, reimbursing eligible costs incurred in training development implementation.
  • Entrepreneurs in need of quick turnaround in receiving support for training costs can make use of the state’s Job Based Training Reimbursement program, which provides support within the first 90 days after a new job is created and training starts.
  • The FastTrack Job Training Assistance Program offers employers state support to cover costs for classroom instruction, on-the-job training, training-related travel, training vendors, and development of training materials and programming.

Sixth District states appear to be on a solid track to address skills gap challenges, combining investment in training, education, and business assistance as a long-term workforce development strategy. Time will tell if the investment pays off (we should know sooner rather than later, as boomers are expected to start retiring in droves).

To learn more about states’ efforts, as well as their rankings across five policy areas—talent pipeline, exports and international trade, technology and entrepreneurship, business climate, and infrastructure—check out the U.S. Chamber of Commerce Foundation’s study. There’s also a nifty interactive map you can use to view state rankings and data easily.

Photo of Rebekah DurhamBy Rebekah Durham, economic policy analysis specialist in the Atlanta Fed's New Orleans Branch


April 25, 2014

Regional Payroll Growth Rebounds in March

According to last week's regional and state employment report from the U.S. Bureau of Labor Statistics (BLS), Sixth District states added 41,500 payrolls on net in March, and the unemployment rate rose slightly from 6.4 percent to 6.5 percent. This month's release also came with an upward revision to February data that indicated the District added 40,500 jobs that month, about 6,100 payrolls higher than the original February estimate. The table gives a state-by-state breakdown of payroll revisions:

140425_tbl1

The new March data and revised February data appear to be another step in the right direction and perhaps give a somewhat stronger signal that the region's labor markets are gaining some traction after experiencing a few months of slower job growth earlier in the year, a pattern not uncommon over the last few years. Not surprisingly, we've seen a similar pattern in the national data as well (see the chart).


Payroll survey
Once again, Florida was the primary driver of Sixth District payroll growth in March, adding 22,900 payrolls, with Georgia seeing a nice rebound (up 14,600) from February's negative payroll growth (when it was down 5,800). The only state to lose jobs from February to March was Mississippi, which shed 1,400 payrolls. This was the fourth straight month of net payroll losses in that state.

Florida's net payroll gain was the largest one-month addition of any state in the nation, according to the BLS report, and was driven by the leisure and hospitality sector (up 9,500), health care (up 3,300), construction (up 1,900) and manufacturing (up 1,500), and Georgia's net payroll gain—the third-largest of any U.S. state—was driven by retail (up 3,800), the professional and business services sector (up 3,300), and health care (up 3,200).

As for other District states, Tennessee experienced a modest gain in payrolls in March, adding 4,200 jobs. With the largest revision of any Sixth District state, Tennessee's February net payrolls were revised up 3,400 payrolls for a total of 10,300 payrolls. Tennessee's payroll growth over the two-month period of February and March was primarily concentrated in professional and business services (up 6,800 payrolls). Louisiana and Alabama respectively added 900 and 300 jobs in March (see the chart).


Household survey
The aggregate unemployment rate for the Sixth District rose from 6.4 percent to 6.5 percent in March. Half of the six District states experienced an increase in their unemployment rates (Alabama, Florida, and Mississippi), and Louisiana's rate remained unchanged, Georgia's fell from 7.1 percent to 7.0 percent, and Tennessee's fell from 6.9 percent to 6.7 percent (see the table).

140425_tbl2

Want to find out how many jobs it would take to lower the unemployment rate in any of the 50 states? Check out the Atlanta Fed's State Jobs Calculator.

The BLS's next regional and state employment report, which will reflect April data, will be released May 16.

Photo of Teri GaffordBy Teri Gafford, a Regional Economic Information Network director in the Atlanta Fed's Birmingham Branch

 

and

Photo of Mark CarterMark Carter, a senior economic analyst in the Atlanta Fed's research department


May 10, 2013

Expansion in Regional Manufacturing Continues

Manufacturing contacts in the Southeast region reported continued expansion for the fourth consecutive month, as reflected in the Southeast Purchasing Managers Index (PMI).

The Southeast PMI, produced by the Econometric Center at Kennesaw State University, provides an analysis of the most current market conditions for the manufacturing sector in Alabama, Georgia, Florida, Louisiana, Mississippi, and Tennessee. The index is based on a survey of representatives from companies in those states regarding trends and activity of new orders, production, employment, supplier delivery time, and finished goods. A reading on this index above 50 represents an expansion in the manufacturing sector, and a reading below 50 indicates a contraction.

This positive trend for manufacturing activity came as a pleasant surprise as the Institute of Supply Management (ISM) Manufacturing Index reported two consecutive drops in the national PMI, suggesting manufacturing growth to have slowed nationally. While Southeast PMI is not a subset of the national index, both measure a mix of similar components by surveying purchasing managers.

The Southeast PMI experienced less than a point increase in April compared with March. Although this increase over the prior period is minimal, the overall index reflected the highest level since May 2012 at 55.5, which is 5.5 points above the of 50-point benchmark. Increases in indices of new orders, production, and employment drove this growth, and each of these components was substantially above its respective measure in the national PMI.

Production experienced the most significant jump of the survey components, with an increase of 5.7 points from March to April, ending at 61.2. Employment jumped 4.1 points during the same period to 57.8. While new orders reflected a much smaller increase of 0.4 points, this minimal increase brings the submeasure to 57.8, well above the expansion benchmark (see the chart).

Of survey participants, 43 percent expect production to be higher in the next three to six months, versus 33 percent for the prior survey period. Although this is not the highest level of optimism reported this year by survey participants, those following the industry welcome these positive sentiments while watching to see if the region will continue to outperform national manufacturing activity.

By Amy Pitts, a senior Regional Economic Information Network analyst in the Atlanta Fed’s Nashville Branch

April 23, 2013

Regional Employment Grew in March, Led by Florida and Georgia

On April 19, the Bureau of Labor Statistics (BLS) released the March regional and state employment and unemployment report. Data in the report show that Sixth District states added a seasonally adjusted 45,500 payrolls in March, and the aggregated regional unemployment rate dropped 0.1 percentage point, to 7.7 percent, with results generally positive across southeastern states (see the chart). The United States as a whole added 88,000 payrolls in March 2013, which means the Sixth District states accounted for a large portion of the national gain.

Notably, February payroll gains for the region were revised down by 11,800, to a new level of 29,800. Nonetheless, the three-month average employment gain for the region remained a healthy 34,500.

Sixth District highlights

  • All states within the Sixth District with the exception of Tennessee added payrolls in March 2013 (see the table). The largest gains were in Florida (32,700, highest in the nation) and Georgia (13,600, third-highest in the nation).
    • Leisure and hospitality (12,500) added the most jobs in Florida, followed by trade, transportation, and utilities (6,600) and construction (5,500).
    • Payroll increases in Georgia came from professional and business services (6,700), trade, transportation, and utilities (4,200) and construction (3,100).
    • Most of the sectors in Tennessee cut jobs over the month, with the leaders being professional and business services (down 3,300) and trade, transportation and utilities (down 2,400).
    • Alabama, Louisiana, and Mississippi experienced only small increases in payrolls.
  • The unemployment rate decreased in Florida (down 0.3 percentage point), Georgia (down 0.2 percentage point), and Mississippi (down 0.2 percentage point). It was unchanged in Alabama and increased in Louisiana (up 0.2 percentage point) and Tennessee (up 0.1 percentage point; see the chart).

Photo of Neil DesaiBy Neil Desai, a senior economic analyst in the Atlanta Fed’s research department

July 9, 2014

Southeastern States Mind the (Skills) Gap

During the past few years, we have heard from a significant number of regional business contacts about the challenges they experience filling certain positions and concerns about a skills gap facing the Southeast. We heard this from various industries, most often about engineering, construction, and IT jobs. The most recent Southeastern Insights mentions this widespread issue.

This skills shortage situation is not unique to the Southeast. The U.S. Chamber of Commerce Foundation published a state-by-state analysis last month measuring performance in a number of areas that contribute to economic prosperity. Their key conclusion reiterates our contacts’ concerns: that mounting skilled-labor shortages are on the horizon to such an extent that they may soon hinder economic growth. According to the study, the current skills gap dilemma is expected to grow substantially as baby boomers retire.  

Fortunately, there’s a bright side: many states have recognized this situation and have taken steps to address the ostensibly approaching workforce crisis. Many of our contacts from both private and public sectors pointed to joint initiatives created by states and businesses designed to confront and abate the situation; which the U.S. Chamber of Commerce Foundation study says is essential to closing the gaps. Below is a sample, extracted from the study, of some of the efforts Sixth District states have taken:

Alabama

  • In 2013, the state launched a College and Career Ready Task Force charged with identifying ways to better prepare students for the workforce by training them in the skills demanded by growing industries across the state.
  • New and expanding businesses can get workforce development services through the Alabama Industrial Development Training program, which offers services to businesses in need of skilled workers, including preemployment selection and training, leadership development courses, and third-party process improvement assessments.
  • The Alabama Technology Network provides skills training for the manufacturing and high technology workforce. The network connects businesses to the portfolio of training resources and programs provided by the state’s colleges and universities, offering services through regional centers.
  • The Go Build Alabama initiative works to attract talented workers to construction and skilled trades.

Florida

  • Quick Response Training enables new and expanding businesses in need of training to partner with community colleges and other educational institutions in the state to develop and deliver workforce training programs.
  • The Incumbent Worker Training program supports training the existing workforce to enhance and maintain competitiveness.
  • The Career and Professional Education Act guides Florida’s efforts to diversify its economy and develop a more skilled workforce by encouraging collaboration among education, industry, workforce, and economic development stakeholders from across the state.

Georgia

  • In early 2014, the state approved a $44.7 million Science Learning Center on the University of Georgia’s South Campus, providing state-of-the-art facilities aimed at expanding the pipeline for students in science, technology, engineering, and math (often referred to collectively as STEM).
  • Groundbreaking also took place for the Georgia BioScience Training Center, which will support training for companies that choose to locate within the state. Georgia Quick Start, the state’s job training program, will build and operate the state-of-the-art biotech training center.

Louisiana

  • Via the Small Business Employee Training Program, employers can receive up to $3,000 to defray the costs of off-the-shelf training programs for an existing employee.
  • The Louisiana Workforce Commission established Workforce Partners to recognize businesses that have committed to building a “job ready” workforce in the state through support and training.
  • The Strategies to Empower People program provides access to job training, job readiness support, vocational education programs, and a variety of other skills-development services for those receiving government assistance.

Mississippi

  • The Workforce Investment Network consists of more than 60 training and employment centers around the state where employers and job seekers can access services like training, job postings, on-the-job training programs, employment screening services, and job placement assistance.
  • The Mississippi Development Authority also maintains a team of workforce specialists who work with colleges, businesses, workforce development professionals, and other stakeholders to identify resources useful to a particular business. The authority also builds partnerships to pursue needed training services.
  • The University of Mississippi maintains a Professional and Workforce Development program, offering online enrichment courses, certification programs, and outreach services, bringing tailored training programs directly to the employer.

Tennessee

  • The Tennessee Job Skills grant program offers support to technology companies that create “high-skill, high-wage” jobs, reimbursing eligible costs incurred in training development implementation.
  • Entrepreneurs in need of quick turnaround in receiving support for training costs can make use of the state’s Job Based Training Reimbursement program, which provides support within the first 90 days after a new job is created and training starts.
  • The FastTrack Job Training Assistance Program offers employers state support to cover costs for classroom instruction, on-the-job training, training-related travel, training vendors, and development of training materials and programming.

Sixth District states appear to be on a solid track to address skills gap challenges, combining investment in training, education, and business assistance as a long-term workforce development strategy. Time will tell if the investment pays off (we should know sooner rather than later, as boomers are expected to start retiring in droves).

To learn more about states’ efforts, as well as their rankings across five policy areas—talent pipeline, exports and international trade, technology and entrepreneurship, business climate, and infrastructure—check out the U.S. Chamber of Commerce Foundation’s study. There’s also a nifty interactive map you can use to view state rankings and data easily.

Photo of Rebekah DurhamBy Rebekah Durham, economic policy analysis specialist in the Atlanta Fed's New Orleans Branch


April 25, 2014

Regional Payroll Growth Rebounds in March

According to last week's regional and state employment report from the U.S. Bureau of Labor Statistics (BLS), Sixth District states added 41,500 payrolls on net in March, and the unemployment rate rose slightly from 6.4 percent to 6.5 percent. This month's release also came with an upward revision to February data that indicated the District added 40,500 jobs that month, about 6,100 payrolls higher than the original February estimate. The table gives a state-by-state breakdown of payroll revisions:

140425_tbl1

The new March data and revised February data appear to be another step in the right direction and perhaps give a somewhat stronger signal that the region's labor markets are gaining some traction after experiencing a few months of slower job growth earlier in the year, a pattern not uncommon over the last few years. Not surprisingly, we've seen a similar pattern in the national data as well (see the chart).


Payroll survey
Once again, Florida was the primary driver of Sixth District payroll growth in March, adding 22,900 payrolls, with Georgia seeing a nice rebound (up 14,600) from February's negative payroll growth (when it was down 5,800). The only state to lose jobs from February to March was Mississippi, which shed 1,400 payrolls. This was the fourth straight month of net payroll losses in that state.

Florida's net payroll gain was the largest one-month addition of any state in the nation, according to the BLS report, and was driven by the leisure and hospitality sector (up 9,500), health care (up 3,300), construction (up 1,900) and manufacturing (up 1,500), and Georgia's net payroll gain—the third-largest of any U.S. state—was driven by retail (up 3,800), the professional and business services sector (up 3,300), and health care (up 3,200).

As for other District states, Tennessee experienced a modest gain in payrolls in March, adding 4,200 jobs. With the largest revision of any Sixth District state, Tennessee's February net payrolls were revised up 3,400 payrolls for a total of 10,300 payrolls. Tennessee's payroll growth over the two-month period of February and March was primarily concentrated in professional and business services (up 6,800 payrolls). Louisiana and Alabama respectively added 900 and 300 jobs in March (see the chart).


Household survey
The aggregate unemployment rate for the Sixth District rose from 6.4 percent to 6.5 percent in March. Half of the six District states experienced an increase in their unemployment rates (Alabama, Florida, and Mississippi), and Louisiana's rate remained unchanged, Georgia's fell from 7.1 percent to 7.0 percent, and Tennessee's fell from 6.9 percent to 6.7 percent (see the table).

140425_tbl2

Want to find out how many jobs it would take to lower the unemployment rate in any of the 50 states? Check out the Atlanta Fed's State Jobs Calculator.

The BLS's next regional and state employment report, which will reflect April data, will be released May 16.

Photo of Teri GaffordBy Teri Gafford, a Regional Economic Information Network director in the Atlanta Fed's Birmingham Branch

 

and

Photo of Mark CarterMark Carter, a senior economic analyst in the Atlanta Fed's research department


May 10, 2013

Expansion in Regional Manufacturing Continues

Manufacturing contacts in the Southeast region reported continued expansion for the fourth consecutive month, as reflected in the Southeast Purchasing Managers Index (PMI).

The Southeast PMI, produced by the Econometric Center at Kennesaw State University, provides an analysis of the most current market conditions for the manufacturing sector in Alabama, Georgia, Florida, Louisiana, Mississippi, and Tennessee. The index is based on a survey of representatives from companies in those states regarding trends and activity of new orders, production, employment, supplier delivery time, and finished goods. A reading on this index above 50 represents an expansion in the manufacturing sector, and a reading below 50 indicates a contraction.

This positive trend for manufacturing activity came as a pleasant surprise as the Institute of Supply Management (ISM) Manufacturing Index reported two consecutive drops in the national PMI, suggesting manufacturing growth to have slowed nationally. While Southeast PMI is not a subset of the national index, both measure a mix of similar components by surveying purchasing managers.

The Southeast PMI experienced less than a point increase in April compared with March. Although this increase over the prior period is minimal, the overall index reflected the highest level since May 2012 at 55.5, which is 5.5 points above the of 50-point benchmark. Increases in indices of new orders, production, and employment drove this growth, and each of these components was substantially above its respective measure in the national PMI.

Production experienced the most significant jump of the survey components, with an increase of 5.7 points from March to April, ending at 61.2. Employment jumped 4.1 points during the same period to 57.8. While new orders reflected a much smaller increase of 0.4 points, this minimal increase brings the submeasure to 57.8, well above the expansion benchmark (see the chart).

Of survey participants, 43 percent expect production to be higher in the next three to six months, versus 33 percent for the prior survey period. Although this is not the highest level of optimism reported this year by survey participants, those following the industry welcome these positive sentiments while watching to see if the region will continue to outperform national manufacturing activity.

By Amy Pitts, a senior Regional Economic Information Network analyst in the Atlanta Fed’s Nashville Branch

April 23, 2013

Regional Employment Grew in March, Led by Florida and Georgia

On April 19, the Bureau of Labor Statistics (BLS) released the March regional and state employment and unemployment report. Data in the report show that Sixth District states added a seasonally adjusted 45,500 payrolls in March, and the aggregated regional unemployment rate dropped 0.1 percentage point, to 7.7 percent, with results generally positive across southeastern states (see the chart). The United States as a whole added 88,000 payrolls in March 2013, which means the Sixth District states accounted for a large portion of the national gain.

Notably, February payroll gains for the region were revised down by 11,800, to a new level of 29,800. Nonetheless, the three-month average employment gain for the region remained a healthy 34,500.

Sixth District highlights

  • All states within the Sixth District with the exception of Tennessee added payrolls in March 2013 (see the table). The largest gains were in Florida (32,700, highest in the nation) and Georgia (13,600, third-highest in the nation).
    • Leisure and hospitality (12,500) added the most jobs in Florida, followed by trade, transportation, and utilities (6,600) and construction (5,500).
    • Payroll increases in Georgia came from professional and business services (6,700), trade, transportation, and utilities (4,200) and construction (3,100).
    • Most of the sectors in Tennessee cut jobs over the month, with the leaders being professional and business services (down 3,300) and trade, transportation and utilities (down 2,400).
    • Alabama, Louisiana, and Mississippi experienced only small increases in payrolls.
  • The unemployment rate decreased in Florida (down 0.3 percentage point), Georgia (down 0.2 percentage point), and Mississippi (down 0.2 percentage point). It was unchanged in Alabama and increased in Louisiana (up 0.2 percentage point) and Tennessee (up 0.1 percentage point; see the chart).

Photo of Neil DesaiBy Neil Desai, a senior economic analyst in the Atlanta Fed’s research department