Nonfarm jobs made a seasonal February bounce driving the 2019 Tri-Cities jobs growth trend rate higher. Employment for the seven-county region was also higher and unemployment rates dropped.
Preliminary non-adjusted monthly totals from the Bureau of Labor Statistics show the Tri-Cities had 203,600 nonfarm jobs in February. That’s 2,600 more than February last year and 700 more than the pre-recession benchmark. February’s non-adjusted numbers are typically a big bounce from January, and they will be adjusted in the March report.
The employment report shows 242,200 people were working. That’s a 3,248-person improvement from February last year and 4,882 fewer than the pre-recession high.
A noteworthy point in February’s report is the three-county Johnson City MSA’s monthly total is above the pre-recession benchmark for the second straight month. Johnson City’s 2018 annual total was better than the pre-recession benchmark for the second year. February’s total was 1,400 jobs the benchmark and 400 better than February so unless the adjustment is a big one the lower half of the region has a firm foothold on a labor-market recovery status.
Kingsport-Bristol has been chipping away at the precession level. It finished 2018 with an annual gain of 100 jobs but was 1,600 jobs below the 2008 annual total. February’s total was 700 shy of the benchmark and 1,600 better than February last year.
February’s unemployment rate across the region and the state declined. “It is encouraging when unemployment rates drop in every county across the state,” Tennessee Department of Labor and Workforce Development said. He’s right, but there’s a caveat about looking at just the unemployment rate. ETSU Economists Steb Hipple once chided it as one of the most useless pieces of data produced by the federal government. That jab came when the unemployment figures were telling one version of the labor market story, and the jobs report was telling an opposite story. That happens sometimes, and when it does it’s best to rely on the jobs report since it is the larger sample and the most reliable metric. But almost all media, civic and government officials use the U3 unemployment report as a primary labor market indicator. In reality, it isn’t.
The best way to look at the labor market is by balancing the unemployment report, and the jobs report. Both have strengths and weaknesses.
The household report is a survey based on 60,000 households across the nation. From that sample, the unemployment rate (U3 report) is estimated for cities above 20,000 population, counties, MSA and the nation. To be classified as unemployed a person has been available for and looking for work four weeks before each monthly survey. The survey also doesn’t differentiate between full-time and part-time work. For example, a part-timer who works two hours a day counts the same as a full-time worker. The household survey also doesn’t where a person works. A Johnson City resident with a full-time job in Bristol is counted as employed in Johnson City. The U4, U5, and U6 reports present data a little differently, but they are not broken down to the local level, and only the U6 report gets much public attention.
The payroll survey goes to private and government employers to estimate the total number of workers on nonfarm jobs, their hourly wage and the number of hours worked. It covers about 30% of all U.S. workers and estimates the rest. The BLS revises the monthly estimates as it gets better data and those revisions can make big changes from the preliminary numbers. Once a year another revision is made for the annual report.
The payroll report frequently finds fewer jobs than the number of people employed in the household report because someone working two jobs is counted once in the payroll study but twice in the employment report. And self-employed people are counted in the household survey, but not the payroll report.
The local labor market is heavily saturated by part-time workers and the region has a chronic, structural underemployment issue. In the most current American Community Survey of people who had worked in the past 12 months 22% (about 92,000 people), Tri-Cities residents said they worked less than full-time. The labor market is also influenced the current trade disputes. That’s why Eastman has given the community a heads up that the trade dispute with China would result in some layoffs this year. The underemployment issue is the focus of post-primary school tech and technical training; however, structural problems typically take years to resolve.
Currently, both reports are telling the same labor market story – jobs and employment are increasing.
Here are February’s regional unemployment rates:
Tri-Cities – 3.6%.
Johnson City MSA – 3.5%
Carter Co. – 3.8%
Unicoi Co. – 5.1%
Washington Co. – 3.1%
Kingsport-Bristol MSA – 3.6%
Hawkins Co. – 3.6%
Sullivan Co. – 3.5%
Virginia portion of Kingsport-Bristol – 3.8%
Greene Co. 4.4%
Hancock Co. 5.8%
Johnson Co. 3.6%
Tennessee’s February jobless rate was 3.2%. The U.S. rate was 3.8%.
The U.S. U6 report, which counts not only people without work seeking full-time employment (that’s what the U3 rate used by the media and government concerns) but also counts marginally attached workers and those working part-time for economic reasons was 7.3% in February. The last time it was in those ranges was in the year 2000.