The Atlanta Fed's SouthPoint offers commentary and observations on various aspects of the region's economy.
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Regional Job Growth Loses Some Traction
Last Friday, the U.S. Bureau of Labor Statistics (BLS) released the Regional and State Employment and Unemployment report for August, which included data such as the new payrolls by industry, unemployment rates, and labor force participation rates at the state and regional levels. Given the economic diversity across the region, it’s not particularly surprising that payroll creation varied dramatically by state within the Sixth Federal Reserve District in August. Slightly more surprising, however, is that in the aggregate, the Sixth District had 3,500 fewer jobs in August than it did in July.
This decline represented the Sixth District’s first net loss in payrolls since July 2012. In large part, this drop is the result of Georgia and Florida giving back a large portion of the gains both states saw in July, when the district netted 44,400 new payrolls (see the chart). When averaging July and August together for the Sixth District, you get a figure much more in the neighborhood of the 2013 average (to date) of about 24,000 new payrolls each month.
Despite the declines in Georgia and Florida weighing heavily on the district’s overall payroll figure in August a few rays of sunshine were apparent in the report for the district:
- Louisiana’s labor market saw an increase of 14,000 new payrolls in August. The largest increase by sector in the Louisiana last month was a 6,200 payroll jump in leisure and hospitality, with 5,400 of those showing up in accommodation and food services. Louisiana’s construction sector also saw an increase during the month to the tune of 2,200 new payrolls.
- Despite Florida’s net negative payroll figure for the month, many sectors within the Sunshine State fared well in August: Florida added 4,700 construction payrolls last month while also adding 4,100 payrolls in wholesale trade. The state also added 2,000 manufacturing payrolls in August. The drags on Florida’s net figure last month were in education and health services (down 4,300 payrolls), leisure and hospitality (down 4,400 payrolls), and government (down 2,300 payrolls).
Sixth District unemployment rates
The Sixth District aggregate unemployment rate remained at 7.6 percent in August, where it has remained since April. The unemployment rate fluctuated very little by state in August for Sixth District states (see the chart). Alabama’s unemployment rate added 0.1 percentage point to reach 6.3 percent and was the only Sixth District state to have a higher unemployment rate in August than in July. Rates stayed the same in Louisiana (7 percent) and Tennessee (8.5 percent). Rates edged down 0.1 percentage point in Florida (7 percent), Georgia (8.7 percent), and Mississippi (8.5 percent).
Sixth District labor force participation rates
The Employment Situation report released by the BLS on September 6 reported 169,000 new payrolls added in August and that the unemployment rate fell 0.1 percentage point to reach 7.3 percent. Those two statistics don’t look all that bad, but beneath the headline, we saw large downward revisions for June and July payroll figures, and we sawthat 312,000 people left the U.S. labor force in August, a huge factor in the decline in the unemployment rate last month. This large number of people departing the labor force also led to August seeing the lowest labor force participation rate (LFPR), 63.2 percent, since August 1978. (For more on trends related to the national LFPR, see this recent post on the Atlanta Fed’s macroblog.)
While it’s no secret that southeastern states have generally had a lower LFPR than the national average, the declining trend seen in the national LFPR also occurred through August across Sixth District States (see the chart). As of August, Alabama and Mississippi have the lowest LFPRs in the Sixth District, with participation rates of 57 percent. Georgia’s, at 63.4 percent, remains the highest within the district, with an LFPR just a hair above the national rate.
The next national Employment Situation report comes out on October 4, and the next regional update from the BLS will be out on October 22. Until then, you can catch up on the Federal Reserve’s latest research focusing on unemployment, labor force participation, and a host of other labor market issues by checking out the Human Capital Compendium in the Atlanta Fed’s Center for Human Capital Studies.
By Mark Carter, a senior economic analyst in the Atlanta Fed’s research department
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