The Georgia jobless rate dropped to 6.1 percent in June, despite weaker hiring after 12 months of fairly solid growth, the state labor department reported Thursday.
As is often the case, the picture depends on the frame. The state’s economy added just 2,300 jobs during the month – less than half the amount in an average June – while new unemployment claims spiked by 16 percent from May.
The drop in the unemployment rate, from 6.3 in May, was largely because the workforce shrank for the first time in 18 months.
But over the past year, the state has added 106,000 jobs.
“You are pretty much seeing jobs created across the spectrum right now,” said Mark Butler, the state’s labor commissioner. “Georgia is still out-pacing the nation when it comes to job growth.”
The jobless rate is now the lowest it has been in seven years, and is down more than a full point in the past year. Yet it remains higher than the national rate of 5.3 percent.
Georgia’s unemployment rate was consistently lower than the national rate during the boom times of the 1980s and 1990s, but it has now been higher for eight consecutive years.
Jeff Humphreys, director of the Selig Center for Growth at the University of Georgia chalked that up to the economic damage done by the housing crash and the sluggish recovery that followed.
“I am not concerned about that at all,” Humphreys said. “It doesn’t say that much about what we are going. It is more a sign of where we have been.”
Most important, he said, is that job growth has been strong.
“I think this reflects a good hard push at traditional economic development,” Humphreys said. “The state has recruited a lot of companies the past four or five years and it is starting to show up in the job numbers.”
Layoffs, too, look better through a longer lens: first-time filings for unemployment insurance were 14 percent lower in June than in the same month a year ago.
But the economy has not yet paved over all the damage done by the 2007-09 recession.
For instance, even six years after the economy started to grow again, fewer people are working in Georgia than before the downturn. And while the number of jobless Georgians has dropped, there are still nearly 300,000 unemployed and searching for work.
More than 40 percent of them have been jobless for six months or more, a level that would have been a record before 2007.
The share of people in the workforce has fallen dramatically, partly because of retirements, but also because hiring may not be so strong that employers are competing for workers and padding paychecks, said Tanweer Akram, Atlanta-based senior economist at Voya Investment Management.
“Wage growth is still soft,” he said. “If the labor market continues to improve, we should expect wages to gradually rise.”
That depends on continued improvement and a national survey of economists this week showed most expect growth through the rest of this year and into the next. Not everyone shares that optimism.
Between the weak month and the strong year is a troubling trend, said Michael Wald, former Labor Department economist and now independent analyst in Atlanta.
During the first half of this year, Georgia added only 8,900 jobs compared to 43,000 during the first six months of 2014, he said. “Today’s data show that Georgia has experienced the slowest six-month growth in jobs since 2011. It’s a marked slowdown.”
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