Trade sector leads; unemployment rate drops to 7.6%
By Ronald J. Hansen – The Republic | azcentral.com – January 24th, 2014
Arizona employers added nearly 7,000 workers in December, helping to bring down the state’s unemployment rate, officials reported Thursday.
Some industrial sectors posted sizable gains while others recorded smaller-than-usual losses. It meant Arizona’s unwas employment rate dropped from 7.8 percent to 7.6 percent. Nationally, unemployment fell 0.3 percentage points in December to 6.7 percent, but much of the decline was attributed to people giving up looking for work.
Arizona’s trade, transportation and utilities sector, which includes retailers, led the state’s employment growth, adding a net 5,600 workers. It the best December report for that sector since 2006, before the Great Recession started, and suggested that consumers may have been more active during the holiday shopping season.
The state gained a net 6,900 jobs, in part because financial activities had record-high job gains while the construction industry lost only 900 jobs during what is typically a bad month.
“It certainly indicates the economy is picking up,” said Aruna Murthy, director of economic analysis for the Arizona Office of Employment and Population Statistics. Even so, Murthy acknowledged growth remains sluggish overall, leaving many would-be workers discouraged.
“There has been anemic growth. Two-percent growth can only take in so many people,” she said.
That has contributed to the state’s continued slide in its labor force. In December 2008, the state had 3.1 million people who wanted to work. Five years later, there were 150,000 fewer people working or seeking employment even though the overall population has grown.
A review of changes to those receiving Social Security in Arizona suggests that although retirements and disability cases have grown, more than 75 percent of the decline in the labor force could be people who have given up finding a job, Murthy said.
Arizona’s labor-force-participation rate has fallen over the past five years, largely mirroring the national trend.
With December’s numbers, the state gained 49,600 jobs over the past 12 months, enough for 2 percent growth, which was in line with earlier forecasts.
Murthy still expects 2014 will be better, in part because, for the first time since the recession, much of the international economy seems to be growing. Arizona could reach as much as 2.5 percent job growth this year, she said, though even that still would leave the state short of replacing the jobs lost during the recession.