Institute for Economic Advancement

Metro Area Employment and Unemployment – March 2016

By , April 29, 2016 5:05 PM

Earlier this week, the Bureau of Labor Statistics released new statistics on metro area employment and unemployment in March.  Also included in this week’s data dump were the long-awaited annual revisions to household employment and unemployment for metro areas.

The new statistics for March showed that the long decline in unemployment rates has continued, and even accelerated in some metro areas.   The not-seasonally adjusted data showed that unemployment rates have fallen significantly over the past 12 months, with changes ranging from -0.8% in Texarkana to -1.9% in Pine Bluff.

Source:  Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

From February to March, unemployment rates continued their downward march in every Arkansas metro area except for Pine Bluff, where the rate stalled at 5.6%.

Source:  Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

Source: Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

The unemployment rate changes thus far in 2016 come on top of downward revisions to the data for 2015.  As shown in the figures below, the revisions to data for 2014 and 2015 generally evened-out some of the volatility, with the revised data showing smoother, more monotonic downward paths.

Source:  Bureau of Labor Statistics, Seasonally Adjusted Metro Area Estimates

Source: Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

In some cases, there were noticeable changes in the estimated unemployment rate levels (e.g. Pine Bluff and Memphis).  The table below summarizes the impact of the revisions on annual average unemployment rates.  With the exception of Memphis, revised unemployment levels were subject to small revisions in 2014, but the revisions had the effect of lowering the 2015 average unemployment rates for all eight metro areas.

Source: Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

Source: Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

Underlying the changes in unemployment rates, data on employment and unemployment were also revised.  The chart below shows the impact of the revisions on overall employment levels (as measured in the household survey data).  As of December 2015, the revisions increased measured employment in four metro areas and decreased it in the other four.  The largest revisions to the employment data were for Pine Bluff (+5.5%) and Hot Springs (-3.4%).

Source:  Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

Source: Bureau of Labor Statistics, Seasonally Adjusted Metropolitan Area Estimates

Payroll Data
Data from the independent establishment survey showed weaker employment growth than the household survey.  From February to March, payroll employment declined in 6 of 8 metro areas, rising only in Hot Springs and Jonesboro.  Compared to a year ago, employment has declined in Pine Bluff, but is higher in all other metro areas.  Fayetteville and Jonesboro have displayed the highest growth rates over the past year.

Source:  Bureau of Labor Statistics, Current Employment Statistics (CES)

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Arkansas Home Sales – March 2016

By , April 28, 2016 10:55 AM

The Arkansas Realtors® Association announced this morning that home sales in March totaled 2,770 — an increase of 9.7% from March of 2015.  The latest figures extend a string of year-over-year increases that has now lasted 19 consecutive months.  The average growth rate over those 19 months has been 10.2%.  As shown in the figure below, March sales are typically part of the upswing from a slow winter season to a strong summer.  This years total for March, however, is close to peak summer month sales in 2013 and 2014.

Source:  Arkansas Realtors® Association

Source: Arkansas Realtors® Association

The longer-run upward trend in home sales is highlighted in the following figure, which shows seasonally adjusted sales by quarter.  The trends suggest that home sales in 2016 are likely to be close to the robust pre-recession pace.  In fact, if we extrapolate the first quarter’s seasonally adjusted sales pace through the remainder of 2016 (no further growth other than seasonal variation), home sales for the year would be around 32,640 — close to the record-high 33,896 reported in 2006.  If trend growth continues, the annual total could be even higher.

Source:  Arkansas Realtors® Association; Seasonally adjusted by the Institute for Economic Advancement

Source: Arkansas Realtors® Association; Seasonally adjusted by the Institute for Economic Advancement

Arkansas Employment and Unemployment – March 2016

By , April 15, 2016 3:14 PM

The Arkansas unemployment rate was reported to have declined again in March, this time by two-tenths of a percent to 4.0%.  Over the past three months, the rate has fallen by 0.7%.  More remarkable is the underlying data on household employment that has driven the rate decline.  In March, the number of employed Arkansans was reported to have been up 9,569 — the third month in a row of gains near or above 10,000.  From December through March, household employment has increased by more than 30,000.  This is literally unprecedented, and as reported below, it is at odds with the data reported in the separate payroll employment report.

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS).

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS).

Payroll Employment
Nonfarm payrolls were down in March, dropping by 3,900 (seasonally adjusted).  In addition, the data for the previous month were revised slightly downward.  From December through March, payroll employment has declined by a total of 3,100.  It is not unusual for the household data and payroll data to give conflicting signals.  The two sets of employment measures are constructed using different data sources and methods.  The household report includes workers in the farming sector, the self-employed, and workers with jobs outside of Arkansas, whereas the payroll data do not.  The payroll data also count each job, whereas the household survey treats multiple job-holders as a single worker.  None of these differences is likely to account for the type of discrepancy we’ve seen between the two sets of employment numbers so far in 2016.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

Two more likely explanations exist to explain the differences in the two employment series.  One possibility is that the unusually mild winter has had distorting effects on the seasonal patterns in the data.  If this is the case, underlying trends in employment growth are likely to become more apparent as the year proceeds.  The other possibility is that unusual patterns are affecting the viability of the model-based components of the data estimation process.  If this is the case, the divergence may persist in the currently published data until they have been revised with more complete information.

For now, taking the data at face value, the table below shows the breakdown of payroll employment changes for March.  For the month, job losses were evident in the goods-producing sectors and in each component of Trade, Transportation and Utilities.  Professional & Business Services and Education & Health Services continued the positive growth that has characterized those sectors throughout the current economic expansion.

Source: Bureau of Labor Statistics, Current Employment Statistics (CES).

Source: Bureau of Labor Statistics, Current Employment Statistics (CES).

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*Seasonally adjusted data for Arkansas nonfarm payroll employment, reported in a format compatible with the monthly news release from the Arkansas Department of Workforce Services, can be found hereTable-Seasonally Adjusted NFPE.

Metro Area Unemployment and Employment – February 2016

By , April 7, 2016 4:55 PM

New data on unemployment rates in  metro areas came out yesterday.  However, the full time series for employment, unemployment and labor force participation are still not available following the most recent data revision.  Consequently, the only information to report at this time is the not-seasonally adjusted unemployment rates for February.  As shown in the table, unemployment rates have fallen substantially over the most recent 12 months in all eight of the metro areas covering portions of Arkansas.  Declines range from one full percentage point in Texarkana to 1.7% in Memphis.  The BLS News Release noted that Memphis was tied for the largest unemployment rate decline among the 51 metro areas in the country with a population of 1 million or more.

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

Source: Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS)

Payroll Employment:
As previously reported, statewide nonfarm payroll employment rose sharply in February, increasing by 6,100 jobs (0.5%).  Over half of that net job gain took place in Northwest Arkansas:  Employment in the Fayetteville-Springdale-Rogers metro area rose by 3,100 for the month — 1.3%.  Gains were also reported in Jonesboro, Little Rock, and Pine Bluff.  Employment was down for the month in Fort Smith, Memphis, and Texarkana.*  On a year over year basis, employment is up in all metro areas except Pine Bluff.

Source:  Bureau of Labor Statistics, Current Employment Statistics (CES)

Source: Bureau of Labor Statistics, Current Employment Statistics (CES)

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Note:  Seasonally adjusted payroll employment data for Texarkana remain temporarily unavailable from the BLS.  The data in this report were seasonally adjusted in-house at the Institute for Economic Advancement.

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