Workforce conditions & outlook Presented to the Consensus Economic Forecasting Commission January...

Workforce conditions& outlook

Presented to theConsensus Economic Forecasting Commission

January 30, 2014

Glenn MillsChief Economist

Center for Workforce ResearchMaine Dept. of Labor

www.maine.gov/labor/cwri

[email protected] 207-621-5192

mailto:[email protected]

Labor force & unemployment(household survey)

Unemployment rates continue to trend lowerJa

n-08 Apr Ju

lO

ctJa

n-09 Apr Ju

lO

ctJa

n-10 Apr Ju

lO

ctJa

n-11 Apr Ju

lO

ctJa

n-12 Apr Ju

lO

ctJa

n-13 Apr Ju

lO

ct

4%

5%

6%

7%

8%

9%

10% U.S.

Maine

As in previous years, revisions to 2013 unemployment rates are likely to show a much smoother trend

Jan-

11

Mar

May Ju

l

Sep

Nov

Jan-

12

Mar

May Ju

l

Sep

Nov

Jan-

13

Mar

May Ju

l

Sep

Nov

6.0%

6.5%

7.0%

7.5%

8.0%

8.5%Previous Preliminary Estimates

Revised Rates

Approximate Revisions for 2013

A rising share of employed population continues to be the primary factor in lower unemployment rates in Maine. The U.S. share of employed population remains flat –

unemployment rate declines continue to be solely due to lower labor force participation.

Jan-

08

May

Sep

Jan-

09

May

Sep

Jan-

10

May

Sep

Jan-

11

May

Sep

Jan-

12

May

Sep

Jan-

13

May

Sep

58%

59%

60%

61%

62%

63%

64%

U.S.Maine

Em

ploy

men

t to

Pop

ulat

ion

Rat

io (

Sea

sona

lly A

djus

ted)

Expected revisions are likely to smooth 2013 estimates

Jan-

08

May

Sep

Jan-

09

May

Sep

Jan-

10

May

Sep

Jan-

11

May

Sep

Jan-

12

May

Sep

Jan-

13

May

Sep

58%

59%

60%

61%

62%

63%

64%

U.S.MaineApproximate Revisions for 2013

Em

ploy

men

t to

Pop

ulat

ion

Rat

io

(Sea

sona

lly A

djus

ted)

Payroll Jobs

Payroll job estimates for most months since September 2012 will be revised higher. Growth continues to be

concentrated in three sectors: professional & business services, education & healthcare, and leisure & hospitality.

Jan-

07M

ayS

epJa

n-08

May

Sep

Jan-

09M

ayS

epJa

n-10

May

Sep

Jan-

11M

ayS

epJa

n-12

May

Sep

Jan-

13M

ayS

ep

590,000

600,000

610,000

620,000Benchmarked Official Job CountEstimates (to be revised in March)Likely Revisions

Job growth has accelerated after briefly slowing

Jul-10

Oct-10

Jan-11

Apr-11

Jul-11

Oct-11

Jan-12

Apr-12

Jul-12

Oct-12

Jan-13

Apr-13

Jul-13

Oct-13

-6

-4

-2

0

2

4

6

8

Ove

r the

Yea

r Cha

nge

in N

onfa

rmPa

yrol

l Job

s (in

thou

sand

s)

The level of job churn remains modestlybelow pre-recession levels…

2005

.1

2005

.3

2006

.1

2006

.3

2007

.1

2007

.3

2008

.1

2008

.3

2009

.1

2009

.3

2010

.1

2010

.3

2011

.1

2011

.3

2012

.1

2012

.3

2013

.1

30,000

35,000

40,000

45,000

Gross Job GainsGross Job Losses

Priv

ate

Sect

or G

ross

Job

Chan

ge(S

easo

nally

-adj

uste

d)

…Job gains from expanding employers are graduallytrending up and job losses from contractions have flattened…

2005

.1

2005

.3

2006

.1

2006

.3

2007

.1

2007

.3

2008

.1

2008

.3

2009

.1

2009

.3

2010

.1

2010

.3

2011

.1

2011

.3

2012

.1

2012

.3

2013

.1

22,000

26,000

30,000

34,000

ExpansionsContractions

Priv

ate

Sect

or G

ross

Num

ber o

f Job

s(S

easo

nally

-adj

uste

d)

…Job gains from openings and losses from closings continue to gradually trend lower

2005

.1

2005

.3

2006

.1

2006

.3

2007

.1

2007

.3

2008

.1

2008

.3

2009

.1

2009

.3

2010

.1

2010

.3

2011

.1

2011

.3

2012

.1

2012

.3

2013

.1

5,000

7,000

9,000

11,000

OpeningsClosings

Priv

ate

Sect

or G

ross

Num

ber o

f Job

s(S

easo

nally

-adj

uste

d)

More demographic

considerations

As we move through the lifecycle, our attachment to the labor force is highest between age 25 and 54

before declining at an accelerating rate with age...

16-19 20-24 25-34 35-44 45-54 55-64 65+10%

20%

30%

40%

50%

60%

70%

80%

90%

Empl

oym

ent t

o Po

pula

tion

Ratio

…This decade a very large share of the population is aging beyond their peak years of labor force attachment

(Population by year of age if there were no migration in or out of Maine)

15 18 21 24 27 30 33 36 39 42 45 48 51 54 57 60 63 66 69 72 758,000

10,000

12,000

14,000

16,000

18,000

20,000

22,000

2010 2017 2022

Age

…And Maine has an unusually large share ofBaby Boomers and a low share of young people

who will be entering the workforce

0 5 10

15

20

25

30

35

40

45

50

55

60

65

70

75

80

0.0%

0.5%

1.0%

1.5%

2.0%

U.S. Maine

Age

Perc

ent o

f Tot

al P

opul

ation

in 2

012

The population in their peak years of labor force participation is declining rapidly

16-1

9

20-2

4

25-3

4

35-4

4

45-5

4

55-6

4

65-6

9

70-7

4

75+0%

20%

40%

60%

80%

100%

-30,000

-20,000

-10,000

0

10,000

20,000

Projected Population Change (right scale)Labor Force Participation Rate 2012 (left scale)Labor Force Participation Rate 2000 to 2007 Average (left scale)

Labo

r For

ce P

artic

ipati

on R

ates

Proj

ecte

d Po

pula

tion

Chan

ge 2

012-

2017

We can no longer count on a natural increase in population…

1950

1953

1956

1959

1962

1965

1968

1971

1974

1977

1980

1983

1986

1989

1992

1995

1998

2001

2004

2007

2010

8,000

10,000

12,000

14,000

16,000

18,000

20,000

22,000

24,000

-2,000

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000Natural Change (right scale)Births (left scale)Deaths (left scale)

Birt

hs a

nd D

eath

s

Nat

ural

Cha

nge

…We will need an increase to 1970s levels of net in-migration to maintain a stable workforce

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

-4,000

0

4,000

8,000

12,000

Net MigrationNatural Change

Net

Cha

nge

from

Prio

r Yea

r

AppendixRecent trends in payroll jobs

Highlights:• Growing sectors tend to be human capital intensive, often requiring

specialized education, knowledge, or skills:• Healthcare & social services, professional & business services, and educational

services.• Leisure & hospitality, which tends to be labor intensive, also is growing.

• Jobs in sectors that make, move, or sell physical products generally have stabilized, but there is no significant growth:• Manufacturing, construction, wholesale &retail trade, and transportation,

warehousing & utilities.

• All three levels of government continue to shed jobs.• The experience of those displaced from labor intensive work generally

does not match the education and skill requirements of growing sectors.

Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

13585

595

605

615

625

Total Nonfarm Jobs(seasonally adjusted in thousands)

Benchmarked Job CountEstimates (to be revised March 2014)Likely Revisions

Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

13485

495

505

515

525

Total Private Jobs(seasonally adjusted in thousands)

Benchmarked NF JobsEstimated Jobs (to be revised March 2014)Likely Revisions

Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

1354

55

56

57

58

59

60

61

Professional & Business Services Jobs(seasonally adjusted in thousands)


Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

1358

59

60

61

62

63

64

65

Leisure & Hospitality Jobs(seasonally adjusted in thousands)

Benchmarked Job Count

Estimates (to be revised March 2014)

Likely Revisions

Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

1397

98

99

100

101

102

Healthcare & Social Assistance Jobs(seasonally adjusted in thousands)


Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

1318

19

20

21

22

Educational Services Jobs(seasonally adjusted in thousands)



Likely Revisions

Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

1330

31

32

33

34

Financial Activities Jobs(seasonally adjusted in thousands)


Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

1316

17

18

19

20

Transportation, Warehousing & Utilities Jobs(seasonally adjusted in thousands)



Likely Revisions

Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

1318

19

20

21

22

Wholesale Trade Jobs(seasonally adjusted in thousands)


Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

1380

82

84

86

88

Retail Trade Jobs(seasonally adjusted in thousands)


Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

1323

25

27

29

31

Construction Jobs(seasonally adjusted in thousands)


Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

1348

50

52

54

56

58

60

Manufacturing Jobs(seasonally adjusted in thousands)



Likely Revisions

Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

137

8

9

10

11

12

Information Jobs(seasonally adjusted in thousands)


Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

1313

15

17

19

Federal Government Jobs(seasonally adjusted in thousands)


TemporaryCensusJobs

Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

1325

26

27

28

29

State Government Jobs(seasonally adjusted in thousands)



Jan-

08

Jan-

09

Jan-

10

Jan-

11

Jan-

12

Jan-

1357

58

59

60

61

62

63

Local Government Jobs(seasonally adjusted in thousands)


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