Tag: Employment

Colorado Jobs Data for October – Mixed Message

horvath

The recent BLS jobs report for Colorado had mixed news.

The good news is that Colorado will see solid job growth this year. The bad news is that jobs are being added at a slower rate than earlier in the year.

On the street, most Colorado business owners are not pleased with government leadership, but they are generally upbeat about the economy.

The unemployment rate was flat from February through August. The slight declines in September and October are a sign that the rate continues to slowly move downward. BLS reports the state rate is lower than the rate for the U.S.; however, it is not statistically different than the U.S. (The latest state rate is 6.8% compared to 7.3% for the U.S.)

On a positive note, the number of unemployed workers has fallen to 185,500. This is the lowest number of unemployed since February 2009; however, it is more than twice the pre-recession number.

The wage and salary data is mostly positive. The average number of jobs added for the first 10 months of 2013 is about 56,400 greater than the same period last year. Unfortunately, jobs have been added at a declining rate since March.

Colorado is on track to add about 55,000 jobs for 2013, an increase of 2.3%. The question is, “Given this downward trend in the number of jobs being added, what lies ahead for 2014?”

All jobs are important; however, there is concern there are too few jobs being added that “create” other jobs or bring in wealth from the outside. The lack of a sufficient number of new primary jobs may be the reason for the decreasing rate of growth. State and local economic developers are working hard to address this issue.

It is unlikely the state numbers were noticeably impacted by the September flooding and the limited Government shutdown. The flooding clearly had a negative impact on the local economies and the limited government shutdown may have caused inconvenience for cities and companies that are heavily dependent on federal funding. These events will likely have a greater impact on overall output than employment.

For the most part, the latest jobs report bodes well for the state.


©Copyright 2011 by CBER.

Surprise – U.S. Employment up by 200,000/month from August to September

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On November 8th the Bureau of Labor Statistics reported the U.S. employment was up by 204,000 in the month of October. This was a shock to many, particularly given the weak ADP numbers published in late October.

The BLS delivered a second surprise by bumping up the net jobs added for August and September. Unfortunately, the number of unemployed in October was only 44,000 less than August, and the unemployment rate, 7.3%, was the same for both months.

For the first 10 months of 2013, U.S. employment increased at an average rate of 186,300 jobs per month. This is above the monthly average for 2012 (185,000) and 2011 (175,000).

U.S. job growth was strong in the first quarter of 2013, but the increases became more tepid as the year progressed. Average job growth for the past three months is slightly above 200,000. The December release will show the extent to which Congress’ game of chicken with the Federal budget derailed this momentum.

U.S. Employment Situation

©Copyright 2011 by CBER.

U.S. Jobs Are Being Added at a Slower Rate

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On October 22nd the Bureau of Labor Statistics reported the U.S. added 148,000 jobs in the month of September. For the first 9 months of 2013, U.S. employment increased at an average rate of 177,000 jobs per month. This is below the monthly average for 2012 (185,000) and slightly above the monthly average for 2011 (175,000).

Given the fact that the government shutdown delayed the publication of the jobs data, many economists believe the September value is nothing more than a placeholder that will be revised downward on November 8.

U.S. job growth was strong in the first quarter of 2013, but it has grown at a slower rate as the year has progressed. A similar pattern has occurred in Colorado.

On a positive note, the rate of growth for the state has remained stronger than the nation.

Note: The recent BLS projections do not account for job reductions attributed to the Government shutdown.


©Copyright 2011 by CBER.

Manufacturing is Critical to Colorado

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Manufacturing is important to the Colorado economy for a variety of reasons.

From a data perspective, manufacturing is important for the following reasons:

  • 131,989 workers are employed in the sector. This is 5.8% of total employment and 7.0% of all private sector jobs.
  • There are 5,280 manufacturing establishments. This is 3.1% of all firms, public and private.
  • Total annual wages are $8.2 billion, or 7.2% of total wages and 8.5% of the private sector total.
  •  Average annual wages are $62,237. This is 123.1% of the state average and 122.2% of the private sector average.

The source is the 2012 QCEW data series produced by BLS.

 

©Copyright 2011 by CBER.

Government Sector is Top in Output and Jobs for Colorado

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All industries are important to the economy for different reasons! Some may generate tax revenue for governments,  they may create jobs, or they might pay higher than average wages. Others may be lifestyle industries or they may be strong producers of output.  By comprehending how industries contribute to the economy, it is possible to better understand how they relate to each other and how they cause an economy to expand or contract.

There are distinct differences between the top 10 Colorado sectors for output and employment.  Government tops both lists. The sectors in green are common to both lists and are particularly important to the Colorado economy.

It is imperative to have public and private leaders who understand that industries are important to the economy for different reasons. They must recognize that some industries create jobs, others generate output, and some produce both.  In Colorado, the following sectors most effectively produce both: Health care; Retail trade; Professional, scientific, and technical; Manufacturing; and Finance and insurance.

2012 Colorado GDP

2012 CES Employment

  1. Government

  1. Government

  2. Real estate and rental and leasing

  2. Health care and social assistance

  3. Professional, scient., and tech..

  3. Accommodations and food services

  4. Information

  4. Retail trade

  5. Manufacturing

  5. Professional, scient., and tech.

  6. Finance and insurance

  6. Administrative and waste management

  7. Health care and social assistance

  7. Manufacturing

  8. Retail trade

  8. Construction

  9. Wholesale trade

  9. Finance and insurance

10. Mining

10. Other services

Source: BLS and BEA.

The top 10 output sectors account for 77.7% of total GDP and the top 10 job sectors account for 81.9% of total employment.

For additional analysis of Colorado employment and output go to the cber.co website.

©Copyright 2011 by CBER.

Despite Solid Job Growth the Number of Unemployed has Dropped Very Little in 2013

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This year Colorado is expected to add over 55,000 wage and salary workers, an increase of about 2.5%. This equates to about 4,600 jobs each month.

But there is a downside.

Between January and March of this year the unemployment rate dropped slightly from 7.3% to 7.1%. Since then the rate has moved within the range of 6.9% and 7.1% (see blue line in chart below). These changes are not statistically significant.

The unemployment rate has been stagnant because there has not been a significant change in the size of the labor force or the number of unemployed.

In August, there were 194,068 unemployed workers in Colorado (see red line in chart below). As a point of reference, the lowest number of unemployed prior to the recession was 93,736 in April 2007 and the peak was 245,928 in October 2010.

The number of unemployed workers declined by 6,628 between January and August; however, there was a drop of only 1,561 between March and August. In August 2013 the number of unemployed was 194,068.

Some high tech industries are struggling to find qualified workers, particularly in specialized positions. On the other hand, the unemployment rate in other industries remains in double digits. The problem is exacerbated by the fact that a portion of the sidelined workers do not have the skills or education to fill positions in industries with low unemployment rates.

Clearly, the recovery from the Great Recession created a dysfunctional economy.

©Copyright 2011 by CBER.

September Jobs Report Shows Jobs Added at Slower Pace

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Colorado’s average employment through August is 58,500 jobs greater than the same period last year. After a strong first quarter, the rate of job gains has tapered off slightly.

About 64% of total jobs are added in the top five sectors:

  • 11,500 jobs   Accommodations and Food Services
  • 7,300 jobs     Health Care
  • 6,800 jobs     Construction
  • 6,200 jobs     Administrative and Waste Management, excluding employment services
  • 5,400 jobs     Retail Trade

The Leisure and Hospitality sector has added about one-in-four jobs.  The L&H sector includes:

  • Accommodations and Food Services
  • Arts, Entertainment, and Recreation.

Primary jobs/high-tech-related sectors added about 10.7% of total jobs:

  • 4,900 jobs   Professional, Scientific, and Technical
  • 1,100 jobs   Corporate Headquarters (MCE)
  • 900 jobs      Manufacturing
  • -900 jobs     Information.

Cber.co tracks 22 sectors of the economy. Growth is broad-based and 19 are adding workers.

The following sectors have been flat or they posted minimal gains: Transportation, Warehousing, and Utilities; Financial Activities; and State Government, excluding Higher Education.

The three sectors showing jobs losses are:

  • -1,300 jobs    Federal Government
  • -900 jobs       Information
  • -600 jobs       Natural Resources.

Combined, these three sectors have lost 2,800 jobs in the first eight months of 2013 compared to the same period last year.

At this point, it appears that total state employment will be in the range of 55,000 to 60,000 for 2013. This is slightly higher than the Cber.co forecast.

©Copyright 2011 by CBER.

Changes in the Colorado Newspaper Industry – Increased Importance, Declining Employment

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Earlier this year Richard Ballantine, publisher of the Durango Herald, announced to his staff that he was stepping down after 30 years in charge of the organization. Ballantine indicated that new skills and ideas were needed to deal with changing times and technologies.

An August 24 Herald article, “Richard Ballantine has left the Building,” stated, “It was precisely the same reasoning his mother cited when she passed the publisher’s mantle to her oldest child.” (For those not familiar with the Herald, it is been in the Ballantine family since 1952.)

  • Morley Ballantine, 1983: “In this swiftly-changing time when we’re in transition between the age of technocracy and the coming information age that prophets predict, it’s important to have vigorous leadership. … Richard’s bright and quick and, above all, he has common sense.”
  • Richard Ballantine, 2013: “Digital distribution and digital interactivity is where communication is and is going. We felt we had to have a leader who knows how we can play a role in that.”

The change in newspaper publishing pointed out by the Ballantines shows a drastic decline in the number of jobs. In Colorado, employment in the sector dropped from 7,508 workers in 2001 to 3,642 jobs in 2012. This is an annualized 6.4% rate of decrease. During this period the number of Colorado newspaper publishers dropped from 176 to 150.

In 2001 the Colorado newspaper industry paid about $278.5 million in total wages. By 2012 that amount had plummeted to $161.4 million, an annualized decrease of 4.8%.

Despite the changes in technology and the downward trends in employment, firms, and wages, newspapers remain a unique and credible form of communication that will continue to fill a critical role in our democratic process. It will be interesting to see whether Balantine’s successor lasts 30 years and what the industry looks like at the time he steps down.

©Copyright 2011 by CBER.

U.S. Job Recovery Slower than Colorado

horvath

Coloradans breathed a sigh of relief when the BLS released June data showing the state’s wage and salary employment finally returned to the 2008 peak. (For more information about the Colorado situation, click here.)

Nationally, it is a much different story. The U.S. is still about a year away from returning to the 2008 job peak.

U.S. employment topped out at 138.1 million in January 2008. By February 2010, the number of wage and salary jobs had plunged to 129.3 million, a decrease of 8.8 million workers.

At the end of July 2013, 6.7 million jobs had been added since the trough and employment had reached 136.0 million. Slightly more than 2.0 million jobs are needed to reach the pre-recession peak, or about 77% of the jobs have been recovered.

Over the past year, jobs have been added at a rate of about 190,000 per month. If they continue to be added at that rate, it will take another 10 months (May 2014) before the pre-recession peak is reached.

As a result of the Great Recession, the number of unemployed workers jumped from 7.7 million in January 2008 to 15.4 million in October 2010, i.e. the number of unemployed workers doubled. Since October 2010, the number of unemployed has declined to 11.5 million, a decrease of only 3.9 million.

For many Americans, the recovery from the Great Recession has been painful. For another group, the recovery will never happen.

©Copyright 2011 by CBER.

Colorado Job Growth Increasing at a Declining Rate

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Colorado job gains remained solid in June; however, job growth is increasing at a declining rate. Average employment through June 2013 is 59,000 jobs greater than the same period last year.

If the data is evaluated on a quarterly basis, the number of jobs added leveled off for the period Q4 2012 to Q2 2013. In fact, there was a decrease between Q2 and Q1 of 2013.

Q4 2012   58,600

Q1 2013   61,800

Q2 2013   56,300.

On average, about 4,900 jobs have been added each month for the past three quarters.

For the period Q2 2012 to Q2 2013, the number of jobs added at the national level appears to have reached a plateau. Nationally, there was an increase in the job gains between Q2 and Q1 of 2013.

Q2 2012    2,158,000

Q3 2012    2,217,000

Q4 2012    2,188,000

Q1 2013    2,086,700

Q2 2013    2,177,300.

On average, about 180,500 jobs have been added each month for the past five quarters.

In both cases, the level of job growth is modest and expected to remain that way in the near term.

For additional details about the performance of the state economy, go to the cber.co website or click here.


©Copyright 2011 by CBER.