Massachusetts Unemployment and Job Estimates for January 2020; URate 2.8%; YoY payrolls 33,400

This just in from the Executive Office of Labor and Workforce Development:

BOSTON, MA (March 13, 2020)– The state’s January total unemployment remained unchanged at 2.8 percent for the sixth consecutive month following on the Bureau of Labor Statistics’ annual revisions, the Executive Office of Labor and Workforce Development announced Friday.

The Bureau of Labor Statistics’ preliminary job estimates indicate Massachusetts added 11,800 jobs in January. Over the month, the private sector added 11,100 jobs as gains occurred in Trade, Transportation, and Utilities; Education and Health Services; Professional, Scientific, and Business Services; Financial Activities; Leisure and Hospitality; Other Services; Information; Construction; and Manufacturing.

From January 2019 to January 2020, BLS estimates Massachusetts added 33,400 jobs. 

The January unemployment rate was eight-tenths of a percentage point lower than the national rate of 3.6 percent reported by the Bureau of Labor Statistics.

"Following year-end revisions, BLS now estimates Massachusetts added 33,400 jobs over the year. In addition to those job gains, the labor force increased by 27,000 from last year’s level, with 39,400 more residents employed and 12,300 fewer residents unemployed," Labor and Workforce Development Secretary Rosalin Acosta said.

The labor force increased by 1,900 from 3,834,300 in December, as 2,300 more residents were employed and 400 fewer residents were unemployed over the month.

Over the year, the state’s seasonally adjusted unemployment rate dropped three-tenths of a percentage point.

The state’s labor force participation rate – the total number of residents 16 or older who worked or were unemployed and actively sought work in the last four weeks – remained unchanged at 67.9 percent. Compared to January 2019, the labor force participation rate is up two-tenths of a percentage point. 

The largest private sector percentage job gains over the year were in Information; Education and Health Services; Professional, Scientific, and Business Services; and Construction.

Annual revisions to the job estimates show growth was greater than previously published for 2018 and less in 2019.  In 2018, 42,700 jobs were added over the year.   In 2019, estimates indicate 26,100 jobs were added over the year.  BLS annually updates job estimates for each state with the most up-to-date information supplied by employers.

Annual year-end revisions show the unemployment rates were slightly lower than the previously published estimates for August 2019 through November 2019. The labor force estimates were lower than previously published estimates for 2015 to 2019.

January 2020 Employment Overview

Trade, Transportation and Utilities added 3,400 (+0.6%) jobs over the month. Over the year, Trade, Transportation and Utilities gained 2,900 (+0.5%) jobs.

Education and Health Services added 2,000 (+0.2%) jobs over the month. Over the year, Education and Health Services gained 11,700 (+1.4%) jobs. 

Professional, Scientific and Business Services added 1,600 (+0.3%) jobs over the month. Over the year, Professional, Scientific and Business Services gained 7,000 (+1.2%) jobs.

Financial Activities added 1,100 (+0.5%) jobs over the month. Over the year, Financial Activities gained 1,300 (+0.6%) jobs.

Leisure and Hospitality added 800 (+0.2%) jobs over the month. Over the year, Leisure and Hospitality gained 2,100 (+0.6%).

Other Services added 800 (+0.6%) jobs over the month. Over the year, Other Services are up 100 (+0.1%) jobs.

Information added 600 (+0.6%) jobs over the month. Over the year, Information gained 3,600 (+3.9%) jobs.

Construction added 500 (+0.3%) jobs over the month. Over the year, Construction has added 1,000 (+0.6%) jobs.

Manufacturing added 300 (+0.1%) jobs over the month. Over the year, Manufacturing lost 1,500 (-0.6%) jobs.

Government added 700 (+0.2%) jobs over the month. Over the year, Government gained 5,200 (+1.1%) jobs.

Labor Force Overview

The January estimates show 3,729,900 Massachusetts residents were employed and 106,200 were unemployed, for a total labor force of 3,836,100. The unemployment rate remained steady at 2.8 percent. The January labor force increased by 1,900 from 3,834,300 in December, as 2,300 more residents were employed and 400 fewer residents were unemployed over the month. The labor force participation rate, the share of working age population employed and unemployed, remained unchanged at 67.9 percent. The labor force was up 27,000 from the 3,809,100 January 2019 estimate, with 39,400 more residents employed and 12,300 fewer residents unemployed.

Detailed labor market information is available at www.mass.gov/lmi.

Consumer responses to COVID-19 -- Friday, March 13, 2020: Scenes from the rush to stock up, Danvers and Middleton

Shoppers pretty much cleared out the tomato sauce aisle at MarketBasket in Middleton

The oil glut is showing up at the pump. 

The line at the Costco in Danvers was at least 100 yards long

US EMPSIT U-Rate: 3.5% with +273,000 new payroll jobs

OVERVIEW

• The unemployment rate fell to 3.5 percent in February with payrolls expanding by 273,000 jobs, according to the Bureau of Labor Statistics.  
• The Labor Force Participation (LFP) edged up to 63.4 percent. The Employment-Population ratio remained essentially unchanged at 61.1 percent but registered 0.4 of a percentage-point over the year.
• Notable job gains took place in Health Care & Social Assistance (+57,000) Food Services and Drinking Places (+53,000), Government (+45,000), Construction (+42,000), Financial Services (+26,000) and Professional & Technical Services (+32,000).
• The following sectors saw little or no change in February: Mining, Wholesale Trade, Retail Trade, Information, and Transportation and Warehousing. 
• While both the number of unemployed persons and the unemployment rate remained unchanged, the rate has held steady between 3.5 percent and 3.6 percent for the last six months. 
• Over the year, average hourly earnings have increased by 3.1 percent. In February, the average hourly private nonfarm wage rang in at $28.52. The average workweek for all employees rose by 0.1 hours rising slightly to 34.4 hours. 
• The number of long-term unemployed (27 weeks or more) fell to 1.1. million, representing 19.2 of all the unemployed.  Meanwhile, 1.4 million workers identified as “marginally attached to the labor force” remained unchanged in February.
• Revisions for the previous two months pushed the original estimates upward by 85,000. The payrolls report for December was revised from +147,000 to +184,000 while the change for January was also revised up from +225,000 to +273,000. After these revisions, job gains have averaged 243,000 over the last three months.

ANALYSIS

Lost in all of the crisis reporting about the global spread of COVID-19, last Friday’s jobs report is a bright spot in the news cycle.  

The happy news is so much of an orphan that even the payroll-watching Drudge Report has opted to skim over the historic low unemployment rate. (See this link to the estimable Drudge Report’s focus on COVID-19 at the expense of Trumpian good news).  

At a healthy 273,000 print, this most recent payrolls number outstripped Wall Street estimates of 193,000.

 “A home run; a blowout number,” say the well-informed. The even-more estimable ADP lagged the buoyant BLS numbers. According to ADP report released on Wednesday, the private sector generated 183,000 jobs. The BLS private sector number was 228,000.  

So here’s another big question: Have we reached peak job creation? The coronavirus is considered as the convenient excuse for the oncoming recession most would like to avoid. It is also an excuse for the stock market correction that has been desirable in some quarters. Even the bears are right once in a while.

But what counts is the jobs market. “The outbreak will likely lead (businesses) to postpone some hiring plans or even shed jobs if the situation worsens,” said Lydia Boussour, senior U.S. economist at Oxford Economics. How much of a shock will only be determined, as is practice, months from now. 

"This is quite an insurance policy," remarked former Barron's columnist Jim McTague. “It shows that going into this infection, the economy is about as good as you can ever hope for it to be."  

In related news, the Bureau of the Census and the Bureau of Economic Analysis reported that  January exports were $208.6 billion, $0.9 billion less than December exports. January imports were $253.9 billion, $4.2 billion less than December imports (See Figure 1).  

Here too the effects of the coronavirus are not fully known. But it appears for the present time that domestic production and consumption is at happy spot, at least politically.  

The Massachusetts unemployment rate remains lower than the national average. In December 2019, the Massachusetts rate fell to 2.8 percent with the national rate for the same month at 3.5 percent. See Figure 2.