Gaining ground
A look at the states with this year's top job growth
By Andrea Coombes, CBS.MarketWatch.com
Last Update: 8:07 PM ET Nov. 21, 2003
SAN FRANCISCO (CBS.MW) --
Hawaii is benefiting from an increase in tourism as post 9/11 fears fade. Nevada's growing economy continues to hire teachers and construction workers. Georgia's gains are more broad-based.
While the U.S. labor market just started showing signs of improvement in the last month, several states have been chalking up employment gains this year in advance of a national turnaround.
Nevada led the country with 3.3 percent more total jobs in the 12 months ended in October, according to U.S. Labor Department figures released Friday. Total employment in Idaho and Georgia jumped 1.8 percent, while Hawaii gained 1.7 percent and New Mexico rose 1.6 percent.
The U.S. jobless rate was unchanged at 6.0 percent in October, yet rates fell in 36 states from a month earlier.Unemployment claims in the past four weeks dropped to a 33-month low, and total nationwide job gains in August, September and October were the highest in more than a year, with 286,000 jobs created.
"It's only been in the last few months that we've started to gain jobs," said Janell Hyer, a labor market analyst with the Idaho Labor Department. "Last year, we didn't see a lot of seasonal holiday hiring, but we are seeing it this year, and it's earlier."
To be sure, many of the new jobs are temporary positions, in lower-paying retail and food-services fields, and in the health-care industry, which added jobs throughout the economic downturn.
But while many economists bemoan "the jobless recovery," the limited rehiring pace owes in large part to the shallowness of the 2001 recession. The U.S. unemployment rate is barely 2 percentage points above the 3.8 percent recorded in April 2000 - the lowest jobless rate in the nation's history.
Many states typically hardest hit in recessions are close to their historical lows -- and well below post-Depression Era highs. West Virginia, where unemployment peaked at 19.5 percent in the early 1980s recession, is now at 5.6 percent, vs. a record low 4.6 percent in October 2001. Mississippi, where joblessness reached 13.8 percent in 1983, is at 5.7 percent compared with a low of 4.7 percent in February 1999 .
A matter of degree
Several states with the largest percentage gain in jobs have small populations, so one company opening several retail stores or expanding staff has a greater impact than in a larger state, economists said.
Yet even the most-populated states are showing signs of recovery. Florida added 94,100 jobs in the last year, a 1.3 percent increase that put it among the top eight states for job growth. Florida's gains were primarily at temp agencies, public schools and in specialty construction jobs such as masonry, electrical, and plumbing.
Alaska, whose percentage gain equaled Florida's, added just 3,800 total jobs, and its 7.3 percent jobless rate ranks among the highest in the nation. Yet
Alaska saw increases in accounting, engineering and architectural positions, which state officials found cause to celebrate.
"If the engineers are busy and the architects are busy and the accountants are busy ... that suggests there's development going on, that the economy is lively," said Dan Robinson, a labor economist with the Alaska Department of Labor.
The manufacturing states
On the flip side are states like South Carolina, whose employment rolls fell 2.1 percent in the last year, the worst loss of any state. Massachusetts and Michigan ranked second, with total jobs falling 1.5 percent.
The main culprit in all three cases: Lost manufacturing jobs.
South Carolina saw steep declines in textiles and other factory jobs. Michigan also suffered a contraction in manufacturing jobs, along with losses in the government sector, professional positions such as engineering, and in the leisure and hospitality industries, said Jim Rhein, a labor market analyst with the Michigan Career Development Department.
"Michigan is historically one of the most cyclical states in the nation. When there's a downturn, we get hit a little harder," he said.
What follows is a look at the state of the labor market in the five states posting the biggest percentage job gains in the last year.
Nevada holds up
When you think of Nevada, you think gambling. But that's not what's propelling the state's job growth. Instead,
16 years of being the top state in terms of population growth is creating jobs in construction, education and financial services.
The Nevada housing market ranks as one of the hottest in the country, setting records in sales of new and existing homes, said Jim Shabi, an economist with Nevada's Employment and Training Department.
"What we're seeing on the early returns this year is that the growth is actually faster than we're reporting right now," Shabi said. The state's jobless rate stood at 5 percent in October.
The Johnny-come-lately
In addition to increases in temp hiring and construction work, Idaho saw job gains at banks, insurance companies, retail stores and food services.
"We're seeing strong growth in restaurant" work, Hyer said. "We see new establishments coming and not as many old ones closing."
Idaho's specialty-trades industry, including plumbing and masonry work, has been hiring, and retailers are signaling their heightened expectations for the holiday season by showing significantly stronger, and earlier, hiring activity.
On the down side, lumber and food-processing companies have been cutting jobs in the past year, she said. Technology is another weak performer. Micron, a maker of semiconductor components, "had a large layoff in the spring; they're holding their own right now," Hyer said.
"For us, no layoffs is a good sign. Some (tech companies) are making money and reporting profits, and they're hiring a few people here and there."
Idaho's unemployment rate was 5.3 percent in October.
An unrefined silver lining
A booming housing market in Georgia continues to generate construction jobs, along with commercial development, which is ongoing despite low occupancy rates, said Michael Thurmond, the state's labor commissioner.
"Projects are still going up because people believe that days will get better," Thurmond said. "Developers are positioning themselves for a robust recovery."
Yet, while the state also saw gains in health care, temp work, and retail jobs, the news isn't all good.
"There is a caveat to all this: The jobs that are being created, a great majority of them are low-paying jobs," Thurmond said. "We haven't popped the cork on the champagne bottles yet. We are still seeing losses in manufacturing (and) many of the higher-paying jobs are being replaced by service and temp jobs."
Plus, the growth isn't statewide. Instead, "it's been centered in metropolitan Atlanta," he said. "Outside of Atlanta, it's basically been flat."
Georgia's jobless rate stood at 4.2 percent in October.
The sun also rises in paradise
After suffering tourism losses due to 9/11 and the SARS scare, which reduced stopover travelers to Asia,
Hawaii's economy is enjoying broad-based job gains.
The strongest growth, at 5.6 percent, has come in professional, technology and scientific jobs, which includes lawyers, accountants, engineers, computer services, marketing consulting services, said James Hardway, special assistant to the director of the state labor department.
Construction work has picked up after extended weakness in residential real estate prices due to the economic slump in Japan, which long furnished buyers for island properties.
"Hawaii was just granted several billion dollars worth of military-housing projects, which will start in April and add to our growth," Hardway said. "It's an upgrade of the present facilities we already have, and it's a large chunk of change."
Employment in the hospitality industry grew 3.2 percent, or 3,100 jobs, in the last year. On the downside, a 2.5 percent gain in education and human services -- 1,600 jobs - is partly the result of Hawaii suffering the biggest increase in homelessness of any state in the last decade, Hardway said.
Hawaii's jobless rate was 4.2 percent in October.
Oh, down in New Mexico
When the national economy slumps, New Mexico tends to hold its own, said Mark Boyd, economist for the state labor department. And while it's been gaining jobs in the last year, he expects the state to lag in job creation as it tends to do when the U.S. economy is on the upswing.
While total employment is rising, the quality and pay-level of jobs has been declining, Boyd said. Among recently shuttered operations: A bus-manufacturing plant in Roswell, a Phillips semiconductor plant in Albuquerque and a Phelps-Dodge mining facility in Silver City, each of which cut 600 to 1,000 jobs.
An increase in defense spending has helped the state, which is home to Los Alamos Laboratories. "That's kept a certain buoyancy in the economy," Boyd said.
Construction jobs, up 5.7 percent in the last year, helped fuel the gain in the last 12 months, along with increased employment in home-health services for the state's growing retirement-age population.
New Mexico's jobless rate nearly mirrored the national average at 6.1 percent in October. [/color]
Andrea Coombes is a reporter for CBS.MarketWatch.com in San Francisco.
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