Tri-Cities labor market continues positive trend


Tri-Cities’ jobs and employment trend data synced for the third straight month in June and the overall picture was one of an improving labor market – once you look past the seasonal month-to-month declines.

June2

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Using a three-month rolling average for the Bureau of Labor Statistics’ payroll survey of jobs and the household survey of employment shows the trend has been positive since March. That positive picture follows 20 months when the two reports were telling separate stories about the Tri-Cities labor market.

The conflict came into clearer focus when ETSU Economist Steb Hipple said he had doubts about the accuracy of the monthly household survey, which is used to determine local unemployment rates. His remarks came during an interview following his Q1 labor market report on WETS’ “Business Matters” program. Dr. Hipple is also a research associate for the Bureau of Business and Economic Research.

There are two primary labor market reports each month. The first is commonly known as the payroll survey, and it’s just that. It’s a survey of employers and focuses on how many people are working and in what jobs.  This survey is the larger of the two reports and considered the more accurate since it’s a larger sample. But it’s not available on the county or city level.

The second report is commonly known as the household survey. It focuses on localities, how many people are working and how many are looking for a job. It’s the report that drives the monthly unemployment rate. The household survey is a smaller sample so its accuracy is at its best on the national level although it is reported on the county and city (above 25,000) level.

Locally the payroll survey and the household survey reported conflicting stories during the post-recession recovery years. The payroll report was showing job growth. The household survey was showing lower employment and lower unemployment rates as more people left the labor force. That continued through Q1 even after the Bureau of Labor Statistics’ most current revision of the numbers.

Dr.  Hipple told the hosts of Business Matter, “You can’t have one survey going up and another going down and claim they’re observing the same phenomena.”  The data we have watched and payed the most attention to is the household survey, but it’s “telling a story that is apparently wrong.” Dr. Hipple said he does not see a problem with the household data on the national level. It’s the local level where he has an issue.

Which report does he think is telling the most accurate story about local labor markets and why?

“Right now I’m hanging my hat on the payroll data.”  That’s because retail sales affirm the growth in the payroll jobs data. Unfortunately the payroll report is only available on the MSA level. The household data – once you get below the national – level “is not robust, he said. It’s subject to extensive revisions.”

Both reports are needed for a complete picture of the labor market. The payroll survey provides a gauge of monthly change in jobs on the MSA level, but it does not include agricultural jobs and omits much of the  self-employment sector, part-time and contract jobs.

The data used in this report is from the June non-adjusted, preliminary reports. That means this month’s numbers will likely change when the July reports are issued with revisions. And, the data used for this report’s chart is a three-month moving average of nonfarm jobs and employment. The rolling average takes the noise out of the ebb and flow of the monthly reports, but since it’s based on the monthly preliminary data expect revisions next month. Dr. Hipple’s Q2 report will likely be available in late August after the revision from the July reports are made.

Here’s how the June labor market reports look:

TRI-CITIES – unemployment 6.4%, up 0.5%

Nonfarm jobs were down in June as the labor market shifted gears and entered the summer season. The more telling year-to-date count and year-to-year comparison paints a rosier picture. So far this year almost 2,000 new jobs have been created. Compared to June last year there are a little more than 3,100 new nonfarm jobs in the seven-county region. As the chart illustrates, jobs are trending higher, but they have a ways to go before – and if – we get back to pre-recession levels. Compared to June 2008, the number of jobs in June is a little more than 2,600 below the pre-recession benchmark.

Employment also showed a seasonal decline in the June report.  The hit is a little over 2,200 compared to May’s employment. But when compared to June last year it’s up by more than 4,500. Year-to-date employment is up a little over 7,000.

JOHNSON CITY MSA – unemployment 6.7%, up 0.7%

June’s seasonal bite on nonfarm jobs accounts for declines of over 2,000 from the May and year-to-date totals.  Compared to June last year they’re up by 1,400.

The employment report shows the same seasonal decline as jobs when compared to May. Year-to-date employment is up a little over 2,700 and compared to June last year is up 2,470 (3%).  June was the fifth straight month the non-seasonal adjusted, preliminary jobs number has been positive on the year-to-year metric.

KINGSPORT-BRISTOL MSA – unemployment 6.3%, up 0.6%

The seasonal labor market pushed nonfarm jobs down by 1,400 compared to May, and the year-to-date total is down 800. Compared to June last year there were 1,700 more jobs last month – a gain of 1.4%.

Employment in Kingsport-Bristol took an 849 hit compared to May, but the year-to-date total is up 4,435. Compared to June last year the number of people reporting they had a job was up 2,056.

GREENEVILLE MSA – unemployment 7.2%, up 0.7%.

Payroll survey data is not available for Micropolitian Statistical Areas.

June employment was down 701 from the May total. So far this year it’s up 156 and when compared to June last year it’s up 1,548.

BRISTOL – unemployment 6.8%, up 0.9%

Employment was down for the second straight month on the month-to-month metric.  June’s total was 18 less than May.  So far this year it’s up 905 and 251 better than June last year.

JOHNSON CITY – unemployment 6.7%, up 0.6%

Employment was down by 451 compared to May. Year-to-date it’s up by 939. There were 862 more people reporting they had jobs in June than the same month last year.

KINGSPORT – unemployment 6.4%, up 0.3%

Employment in Kingsport was down for the second straight month in June as it was in the region’s other two major cities. The June-May decline was 32. So far this year employment is up 1,003. Compared to June last year it’s up 490.

Unemployment rates for Tennessee Tri-Cities counties in June were:

Carter – 7.1%, up 0.6%.

Greene – 7.2, up 0.7%.

Hawkins – 7%, up 0.6%.

Johnson – 6.2%, up 0.6%.

Sullivan – 6.5%, up 0.8%.

Unicoi – 8.3%, up 0.7%.

Washington – 6.4%, up 0.7%.

Tennessee June unadjusted unemployment rate was 5.7%, up 0.6%.

The U.S. June rate was 5.3%, up 0.2%.

 

 

Trackbacks

  1. […] it posted at http://www.etsu.edu/wets/programming/podcasts.aspx  or read up on it at my posts  “Tri-Cities labor market continues positive trend”  or “May preliminary employment report positive – ETSU economist question accuracy of local Q1 […]

  2. […] straight months when both data sets show growth. It hasn’t been that way from quite a while (see Tri-Cities labor market continues positive trend […]

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