The Atlanta Fed's SouthPoint offers commentary and observations on various aspects of the region's economy.
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Southeastern Labor Market Continues Strengthening
December 2014 state-level labor market data from the U.S. Bureau of Labor Statistics reflected a strengthening labor market among Sixth District states, with a declining aggregate unemployment rate and solid job gains.
Unemployment rates decline, albeit modestly
The aggregate district unemployment rate in December was 6.2 percent, a 0.2 percentage point decline from the previous month and 0.5 percentage point lower than a year ago. Although higher than the 5.6 percent national figure, the aggregate rate continues to trend down. In fact, Florida matched the national unemployment rate in December and Alabama came very close (see the chart).
The unemployment rate declined in nearly all southeastern states. Alabama's unemployment rate fell to 5.7 percent, and Florida's rate declined to 5.6 percent, the lowest level in nearly seven years for both states. At 6.9 percent, Georgia's unemployment rate continued on a downward path, as did Tennessee's, with an unemployment rate of 6.6 percent. For the second month in a row, Mississippi had the highest unemployment rate in the United States with 7.2 percent, a distinction the state has taken turns owning with Georgia since June 2014.
In Louisiana, the unemployment rate rose again (for the eighth straight month) to 6.7 percent in December. What's going on there? As I've mentioned a few times (here, here, and here), increases in the labor force are the driver of unemployment rate increases in the state, as opposed to people actually losing jobs on net. This isn't a bad thing, especially considering the state added more than 6,000 jobs in December (I'll discuss that shortly). Louisiana just added more people looking for work than the number of people who found work, hence the increase in unemployment. In fact, from January to December 2014, Louisiana's labor force grew by 4.8 percent (while the number of employed grew by just 2.8 percent). An increase like 4.8 percent may not seem like a big number, but when you look at the national figure of 0.4 percent during the same period, Louisiana's labor force growth stands out. National data released last week for the month of January told a similar story: the unemployment rate ticked up 0.1 percentage point to 5.7 percent from 5.6 percent in December, yet much of this increase can be attributed to labor force gains that outpaced gains in employment.
Payrolls also see modest growth
On net, the District added 47,400 jobs in December, and every state experienced positive job growth (see the chart). This contribution makes up 19 percent of the national payroll contribution of 252,000. On aggregate, the industries that contributed the most net jobs in the Sixth District were professional and business services (up 9,800), health care (up 8,300), and accommodation and food services (up 5,200).
Here are some key state-by-state payroll facts from the December report:
- Alabama added 1,000 net payrolls. Much of the state's contributions were reduced by losses in the professional and business services sector (down by 2,400).
- Florida added 12,700 jobs on net, mostly from the professional and business services (up 5,800) and health care (up 4,900) sectors.
- Georgia contributed 14,100 net payrolls. Gains were widespread, yet the sector contributing the most jobs was health care (up 3,100).
- Louisiana added 6,200 net payrolls. Gains were widespread in this state as well, though the biggest contributor was the accommodation and food services sector (up 1,600).
- Employers in Mississippi added 900 net payrolls. Gains in the professional and business services sector (up 1,100) were reduced by losses in other sectors.
- Tennessee employers added 12,500 net payrolls. The largest increases occurred in the goods-producing (up 5,300) and retail trade (up 2,400) sectors. employers added 12,500 net payrolls. The largest increases occurred in the goods-producing (up 5,300) and retail trade (up 2,400) sectors.
Overall, the report was a sign of improving labor market conditions across the Sixth District states, a trend we hope to see continue into 2015.
By Rebekah Durham, economic policy analysis specialist in the New Orleans Branch of the Atlanta Fed
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