Thursday, July 21, 2022

Wis june jobs report shows a state at its limits

In today's June jobs report, the Wisconsin Department of Workforce Development chose to emphasize the good situation we were in.
• Place of Residence Data: Wisconsin's labor force participation rate was 66.4 percent in June, 4.2 percentage points higher than the national rate of 62.2 percent in June. Wisconsin's unemployment rate in June was 2.9 percent, near historic lows.

• Place of Work Data: Wisconsin total nonfarm jobs increased by 45,100 jobs and private-sector jobs increased by 44,900 from June 2021 through June 2022. Over the month, total nonfarm jobs decreased by 1,800 and private-sector jobs decreased by 1,700 jobs.
But look at that last sentence – jobs were lost in Wisconsin in June. That seems concerning in a time when the country added 372,000 jobs, and the fact that the household survey showed both total employment (-6,600) and labor force (-4,800) declining in the month is also not a great sign.

However, I will note that these are seasonally adjusted totals in Wisconsin for June. In actuality, more people were working in June in Wisconsin than in May, but it wasn’t as much of a jump as is counted on for June.

Change in jobs, Wisconsin June 2022
All Jobs
Seasonally adjusted -1,800
Non-seasonally-adjusted +30,400

Private Jobs
Seasonally adjusted -1,700
Non-seasonally-adjusted +42,200

Seasonally adjusted -6,600
Non-seasonally-adjusted +18,600

Labor Force
Seasonally adjusted -4,800
Non-seasonally-adjusted +38,100

And that was especially true for touristy types of sectors that usually have large amounts of hiring in the state as Summer kicks into high gear.

Retail Trade
Seasonally adjusted -1,500
Non-seasonally-adjusted +1,700

Arts, Entertainment and Recreation
Seasonally adjusted -3,400
Non-seasonally-adjusted +4,700

Accomodation and Food Services
Seasonally adjusted -1,100
Non-seasonally-adjusted +10,300

I also note that more permanent, blue-collar jobs added positions above and beyond the typical Summer hiring.

Seasonally adjusted +1,300
Non-seasonally-adjusted +7,400

Seasonally adjusted +1,400
Non-seasonally-adjusted +7,100

What this indicates to me is that things are actually still very healthy in Wisconsin’s jobs market, but we still can’t find enough people at publicly facing service jobs to have a typical round of Summer hiring. Some of this may be wage-related, but I also think it is due to a demographic issue that the state has been dealing with for several years.

This is something touched on by the Wisconsin Policy Forum as part of a wider discussion of the changes in the state’s jobs market in the COVID era.
In the past, we have discussed how Wisconsin’s aging population, low birth rate, and lackluster net migration figures have led to a reduction in the working-age population (here defined as individuals between the ages of 18 and 64). The Wisconsin Department of Administration projects the state’s working-age population will remain roughly the same size – if not decline slightly – until at least 2040.

Indeed, from 2010 to 2019, Wisconsin’s working-age population declined by 1.0%. While the state’s overall adult population (ages 18 and older) is growing year-over-year, there is a much more rapid increase in those over the age of 65. In other words, Wisconsin’s residents are reaching a typical retirement age at a much faster rate than they are entering the workforce, shrinking the overall labor pool. On top of that, the pandemic caused more people to retire at earlier ages, and it is still unclear to what extent those retirees can be lured back into the workforce.
All of this information indicates we have a state that seems to be maxed out on workers, and needs to find ways to attract more people to come here. But the GOP that the “business leaders” of the state promotes aren’t going to solve that problem as long as they continue to be regressive fools.

What we need to do is promoting and protect the state’s advantages. This includes the great natural resources that drives all that Summer tourism, and a strong public education, and a high quality of life that can carry throughout the year. Not only does this improve the current and future work force, it also encourages others to locate to Wisconsin.

And getting more people to come here is the one way we are going to grow a Wisconsin labor market that seems to be at its limits today.

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