Weekly Economic Trends and Indicators
The Headline:
Recently, the Bureau of Labor Statistics (BLS) released employment numbers for the Quad Cities metro area for the month of May. In the household survey, the labor force increased by 700 to 186,800 as employment held steady at 179,500. Unemployment increased from 6600 to 7300, and the unemployment rate increased from 3.5% to 3.9%. In the establishment survey, the total number of (non-farm) jobs increased by 2500 from 183,000 to 185,500. Total jobs continues to run about 2000 above the same time last year, but still lags behind pre-COVID numbers by about 3000 jobs.
The Details:
Breaking down the job growth by sector reveals the same pattern that we have seen all year so far. As has been the case for the last several months, leisure and hospitality led the way in adding 1000 jobs. Some of these are likely seasonal positions as we enter the summer months.
Most other sectors posted modest gains that are in line with pre-COVID seasonal patterns. Manufacturing, financial services and information all remained unchanged this month, which is historically not unusual for the month of May.
The total number of jobs exceeds the number of employed individuals due to the fact that some individuals hold multiple jobs. The rise in the unemployment rate in May was due to more people entering the labor force and not finding jobs. This is probably a combination of new high school and college graduates along with people re-entering the labor force after being out for a period of time.
The Context:
All things considered, this is a good employment report. Not great, but definitely good. While the unemployment rate rose, it remains at historically low levels, and the increase may simply be due to the normal influx of young people after graduation.
The leisure and hospitality industry’s gain of 1000 jobs puts them at their highest recorded level of employment in the Quad Cities. On that basis, we could claim that they are essentially recovered from the COVID recession.
Similarly, while manufacturing has been fairly level in the last few months, their recovery from COVID was quicker and more robust. Manufacturing employment in the Quad Cities area now stands comfortably at its highest level in over a decade.
If there are elements of concern, it is mainly to do with labor force participation and employment in services other than leisure and hospitality. The gap is closing, but only very slowly. Professional and business services, in particular, has been slow to recover.
July is typically the peak month for employment, so it will be important to compare this July with those of the recent past to see if progress is being made.
Next week: National employment report
