The Atlanta Fed's SouthPoint offers commentary and observations on various aspects of the region's economy.
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Southeastern Labor Markets Give Off Some Positive Signs
Following an encouraging national employment report released on October 3, last week's release of September 2014 state-level labor market data from the U.S. Bureau of Labor Statistics likewise showed some positive labor market signs. The unemployment rate fell in 31 states, was unchanged from the previous month in 11 states, and rose in eight states. This was the smallest number of states to see a month-over-month increase in unemployment since April. The September report also revealed that employers added net jobs in 39 states and cut jobs in 10 and that payrolls were unchanged in one state. So how did the Sixth District states fare?
Before we dive into the numbers, I'd like to share a disclaimer that might make sense if you've read my posts about state-level employment data during the last few months: churn and seemingly unintuitive results are to be expected with high-frequency economic data, labor market data in particular. Read on to see what I mean.
The aggregate district unemployment rate in September was 6.8 percent, a 0.1 percentage point decline from the previous month, though nearly a full percentage point above the national rate of 5.9 percent (see the chart).
The unemployment rate declined in nearly all states, and Georgia and Tennessee bucked a four-month trend of upward movement, falling to 7.9 and 7.3 percent, respectively. Also, Alabama had a 0.3 percentage point drop in its unemployment rate, which fell to 6.6 percent in September—it's lowest rate in seven months. Florida's rate fell 0.2 percentage point to 6.1 percent, the lowest it's been in over six years.
On the other hand, Louisiana's unemployment rate increased for the fifth consecutive month to 6.0 percent, which isn't necessarily a bad thing in the short run, since the state added jobs (I'll get to that). By definition, Louisiana added more people looking for work than the number of people who found work; hence the increase in unemployment. (This result is what I meant by "seemingly unintuitive.")
In addition, though, the decline in Georgia's unemployment rate may be considered an encouraging sign. The state had the highest unemployment rate in the nation for the second month in a row, followed by another Sixth District state: Mississippi, with 7.7 percent.
Employers in most Sixth District states added to payrolls in September: 39,900 payrolls were added on net (see the chart). The sectors with payroll additions varied state by state, though leisure and hospitality gains were relatively widespread and sizable across Sixth District states, adding 13,200 net jobs. The trade, transportation, and utilities sector contributed the most net jobs with 14,600. However, the majority of these new payrolls came from Florida, and losses in the sector occurred in three Sixth District states: Tennessee (down 1,200), Louisiana (down 600), and Mississippi (down 200). Below, some state-by-state payroll and key sector facts:
- Alabama, which contributed 11,400 net jobs, hadn't seen this many jobs added in one month in about 20 years. Leisure and hospitality (up 5,000) and professional and business services (up 2,600) sectors were the top contributors. The only sector that subtracted jobs in Alabama was financial activities (down 200).
- Florida added 13,400 jobs on net in September, mostly from the trade, transportation, and utilities sector (up 11,300), with a large number of them (8,600) from retail trade alone. Payrolls fell in the financial activities (down 3,400), education and health services (down 2,600), and professional and business services (down 800) sectors.
- After adding nearly 20,000 jobs for two months in a row, Georgia subtracted 2,800 net payrolls from the September aggregate figure. The biggest losses came from the goods-producing sector (down 3,500), with 2,900 manufacturing jobs lost and the professional and business services sector (down 3,300). Georgia's payroll gains occurred in trade, transportation, and utilities (up 3,900), education and health services (up 3,000), and financial activities (up 200).
- Louisiana added 3,600 payrolls on net, most of which came from leisure and hospitality (up 2,000), professional and business services (up 1,300), and the other services (up 1,200) sectors. Losses occurred in the trade, transportation, and utilities (down 600), government (down 600), and education and health services (down 300) sectors.
- Employers in Mississippi added 6,000 net new payrolls in September, the state's largest net gain in nearly a year, mostly boosted by the professional and business services (up 2,700), education and health services (up 2,200), and leisure and hospitality (up 1,300) sectors. The biggest payroll losses occurred in the government sector (down 2,700).
- Tennessee employers increased payrolls by 7,200 on net in September. The largest increases occurred in the education and health services (up 3,100), government (up 2,100), and goods-producing (up 2,000) sectors. Payrolls were subtracted in the trade, transportation, and utilities (down 1,200) and other services (down 1,200) sectors.
Overall, Sixth District states' labor markets fared well in September (though I plan to keep my eyes on Louisiana's rising unemployment trend; watch this space for further analysis).
Hopefully we'll continue to see signs of gathering strength when October's report is released on November 21.
By Rebekah Durham, economic policy analysis specialist in the New Orleans Branch of the Atlanta Fed
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