May Employment Report: Unemployment numbers improve again but job creation remains sluggish
The Bureau of Labor Statistics released May state-level employment numbers today and the news was again good for Oklahoma. The state’s unemployment rate fell from 5.6 percent to 5.3 percent, continuing a trend that has seen the rate fall a full 1.6 percentage points in just six months. Oklahoma’s unemployment rate is now the 4th lowest in the nation, behind only North Dakota (3.2 percent), South Dakota and New Hampshire (both 4.8 percent). The national unemployment rate stood at 9.1 percent in May, up from 9.0 percent in April.
However, while declining unemployment is encouraging, the jobs numbers reported by the BLS were more ambiguous. There were 1,555,200 jobs in Oklahoma in May, an increase of a mere 3,500 from April. Over the past twelve months, the economy has added less than 22,000 jobs.
When the recession began in December 2007, Oklahoma had 1,578,100 jobs. Oklahoma ‘s employment low point occurred in February 2010 when Oklahoma had 61,400 fewer jobs than it did before the recession started. Now in May 2011, Oklahoma still has 22,900 fewer jobs.
The Economic Policy Institute has calculated that Oklahoma’s jobs deficit – or the difference between the number of jobs Oklahoma has and the number it needs to regain its pre-recession employment rate - is 80,000. That number includes the 22,900 jobs Oklahoma lost plus the 57,100 jobs it needs to keep up with the 3.6 percent growth in population that Oklahoma has experienced in the 41 months since the recession began.
As we discussed in this recent post, the discrepancy between the steep drop in the unemployment rate and sluggish growth suggests that while some workers are getting jobs, others are simply getting discouraged and are exiting the labor force entirely. Data that show greater numbers of long-term unemployed and a declining employment-to-population ratio suggest that more Oklahomans are joining the ranks of those who are neither working nor counted among the official ranks of the unemployed.
Despite our plunging unemployment rate, Oklahoma will not be truly out of the Great Recession until job growth is more robust and we have closed the jobs deficit.
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[...] In the 15th year of the Oklahoma’s Promise scholarship, the program has grown from less than 500 students to nearly 21,000. Despite a request from the Oklahoma Public Employees Association, the Office of Juvenile Affairs says they will not delay the September 30 closing of the L.E. Rader Center. The OSU regents voted to increase tuition and fees by 4.8 percent, and the OU regents will vote on a 5 percent increase this week. The OK Policy Blog finds that even as unemployment statistics go down, the total number of jobs in Oklahoma shows only a small increase. [...]
In The Know: June 20, 2011 | OK Policy Blog
20 Jun 11 at 9:02 am
Hi David,
That’s an interesting viewpoint regarding unemployment rates and employment trends. However, I would caution reading too much into 2011 jobs numbers for a couple of reasons: 1) as you know, these are preliminary estimates and are subject to end-of-year benchmarking (which can be significant), and 2) beginning with the preliminary estimates for March 2011, responsibility for the production of Oklahoma’s nonfarm employment estimates have transitioned from the Oklahoma Employment Security Commission (OESC) to the federal Bureau of Labor Statistics (BLS). The result is that BLS is now relying less on local knowledge of our economy and more on statistical methodlogy, (which may result in more month-to-month variability). Thanks!
Monty Evans
20 Jun 11 at 3:58 pm
Thanks, Monty. It’s a bit discouraging when the statisticians are telling us not to trust the statistics :-(
David
21 Jun 11 at 8:42 am
Yes it is. And as you know, revisions can really upset the apple cart. A recent example would be the 2009 state GDP numbers released by BEA late last year. That had Oklahoma leading the nation in GDP growth at 6.6 percent. However, when revised figures were released earlier this month, turns out Oklahoma’s GDP had actually declined by 1.0 percent (dropping our ranking to 15th). Huge swing…just sayin’.
Monty Evans
22 Jun 11 at 12:31 pm
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Labor force data casts doubt on real strength of Oklahoma’s recovery | OK Policy Blog
2 Aug 11 at 11:16 am