Comments on the MA Employment Situation for August 2018: U-Rate: 3.6%; Jobs: +6,100 jobs; +68,100 YoY

OVERVIEW

• The state’s unemployment rate remained at 3.6 percent in August  according to the federal Bureau of Labor Statistics. 
• Over the last 12 months, Massachusetts added 68,100 jobs. 
• The Labor Force Participation rate increased three-tenths of a percentage point to 67.6 percent. 
• The state’s labor force population stands at 3.806 million. Since August 2017, the LFP rate is up 2.1 percentage points. 
• The largest private sector job gains took place in the Education and Health Services (+2,500) the Leisure and Hospitality (+1,700), Professional, Scientific and Business Services (+1,500), Information (+900) and Construction (+500).
• Manufacturing and Trade, Transportation and Utilities each lost 600 jobs.  Other Services lost 100 while Government added 100 jobs; over the past year this sector lost 500 jobs.

ANALYSIS

The August unemployment rate in Massachusetts again was three-tenths of a percentage point lower than the national rate of 3.9 percent. 

"The August estimates indicate the Commonwealth’s labor force and employment are at their highest levels while our unemployment rate remains consistently low - all indicators of the continuing positive economic outlook for the Commonwealth of Massachusetts." Labor and Workforce Development Secretary Rosalin Acosta said last Friday.  

Massachusetts is the locomotive pulling New England states. New Hampshire was the only other New England with a statistically significant change from last August. Maine, along with New Hampshire and Vermont were the NE states with unemployment rates significantly different than the U.S. rate. Only one state, Connecticut saw a downturn in its LFP rate from 66.2 to 65.6 percent. 

Year to date, all NE states are near the November 2017 estimates for 2018 by the New England Economic Partnership.  (MA: 3.7; ME: 3.3; RI: 4.0; VT:3.0; NH 2.5 and CT: 48.) 

NEEP: "Employment growth will be constrained by the number of available workers"

From Alan Clayton-Matthews' presentation to the New England Economic Partnership conference at the Boston Fed yesterday.  A recurring challenge faces Massachusetts and New England: "demographic constraints." Because the region is not growing its working-age population as quickly as the rest of the nation, employers will struggle to find workers. For a variety of reasons older workers may see the need to remain in the labor force due to either financial considerations or in response to other incentives to remain on the job.  

More from Professor Clayton-Matthews: "Construction will be the fastest growing sector, but health services and skilled business sectors will add the most jobs."  Through 2021 the composition of the Massachusetts workforce will not be radically different than what we see today with the erosion of jobs in manufacturing. 

For a recap of the discussion from yesterday's conference, read Michael Norton's State House News Service dispatch.