By George Shaw
Summary
The reduction in unemployment leveled off in January largely because of concerns over the Omicron variant. The rate for Wake County dropped to 2.6% in December 2021 and was the lowest since 1999.
Overall employment continues to rebound at all levels. Wake County’s employment remains 4.0% below a rate adjusted for the growth in its labor force during the last two years. The shortfall is most pronounced in Leisure & Hospitality where employment is down 13.6%. Jobs that pay more than average are within 1.4% of pre-2020 levels.
Wake County continues to recover better than most of its peer metropolitan areas. It ranks in the top four of the 13 High Growth Hubs for all five metrics.
The monthly update of the Misery Index will be covered in this week’s companion piece focused on COVID-19. The Misery Index compares the states in terms of the rate of unemployment as well as mortality from the virus.
National
The three main sources of data on employment tracked by the federal Bureau of Labor Statistics are telling different stories because they focus on different things. There are currently 70+% more job openings than there are unemployed at the national level. North Carolina presently has about 65% more job vacancies than the number who are unemployed.
The Job Openings and Labor Turnover Survey (JOLTS) – 11.2 million openings in January, the second highest monthly total in the history of the report. The record was set in December 2021 with 11.4 million openings. 7.0% of jobs in the total workforce are currently open.
The highest vacancy rates are in Leisure & Hospitality (9.9%), Professional & Business Services (8.5%), and Education & Health (8.4%). The lowest rates among the major categories are in Government (4.4%) and Construction (4.8%).
There were roughly 150,000 more positions hired than separations for jobs paying more than average as of January 2022. There are about 210,000 more hires than separations for jobs paying less than average during the same timeframe.
The corresponding data by state has not yet been released. The figures for North Carolina will be updated when the February data is available in April.
Household Survey. The most widely quoted measure is the unemployment rate which continued its decline to 3.8% at the national level in February, down from 4.0% in December. It has subsequently dropped back to 3.8% in February. This comes from a monthly survey of households. Total unemployment nationally grew from 6.3 million in December to 6.5 million in January and then fell back to 6.3 million in February.
These figures (the Bureau of Labor Statistics U-3 Series) represent a relatively narrow definition of employment. A broader measure (U-6) includes marginally attached and part time employees). It declined to 7.1% of the labor force in January. That means that about 11.4 million people who are either unemployed or underemployed.
Establishment Survey. The final monthly assessment is the survey of business establishments. Employment in January increased 678,000 jobs, up from growth of 481,000 the previous month. Leisure & Hospitality grew 179,000, Education & Health Care rose 112,000 and Professional & Business Services increased 95,000.
North Carolina
The unemployment rate in North Carolina was 3.9% in January down from 4.1% the prior month.
Private sector employment in North Carolina increased 5,300 in January after growth of 17,700 in December. Growth in January was led by Professional & Business Services (3,400) and Construction (2,900).
Wake County
The unemployment rate for our county was 2.6% in January, down from 2.8% the previous month. The only period when our county’s unemployment rate was generally lower than the most recent figure was from 1994 to 1999.
A broader index of unemployment that includes part-time and discouraged workers is a more complete measure of the labor situation in Wake County. This expanded definition increases unemployment in our country from the reported 2.6% to about 5.0% in January. There were no significant changes in employment among the job categories.
Total employment in Wake County declined 4.0% during the year to January 2022 when adjusted for the growth in the labor force as well as seasonal factors. The rate was also 4.0% during the prior month.
Employment in segments that pay above average are 1.4% below expected numbers vs. areas with compensation below average which are down 5.9%. Leisure & Hospitality remains 13.6% below employment figures from a year before.
How Does Raleigh Compare to Other High Growth Hubs in Employment?
Raleigh has been grouped by McKinsey as a high performance hub with a dozen other mid-size metro areas. Wake County’s performance improved during December at a rate comparable or slower than most of the other hubs. Our area remained in the top half of the 13 areas for all categories over the last twelve months.
o Total Non-Farm Employment – 3th high growth hubs trailing Austin and Tampa.
o Total Private Sector Employment – 2nd behind Austin.
o Higher Wage Segments – 2nd behind Austin
o Lower Wage Segments – 4th behind Tampa, Austin and San Antonio. Raleigh was 3rd last month.
o Leisure & Hospitality – 4rd trailing San Antonio, Tampa and Las Vegas.
Revisions to the Data
Major updates to the data were released on Monday. These changes adjusted figures at the national, state and local levels starting with 2017. The data was updated to include the 2020 Decennial Census for the first time.
Population figures were adjusted. North Carolina’s forecasted population was reduced slightly. Vermont’s population was adjusted upward by 3% while California’s was decreased by more than 1%. These changes rippled through the employment data. They also impacted the mortality rates from the virus.
In general, historical estimates of employment increased. Monthly growth in employment had been spiky – large increases followed by modest growth or reductions. These figures became less volatile.
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