The metro Atlanta unemployment rate edged down to 5.1 percent in July from 5.3 percent in June as the number of people with jobs slightly outpaced the growth in jobseekers, the government reported today.
It was a weak month, but actually not as weak as July typically is.
A different survey which counts the number of jobs showed the region’s economy shedding 500 jobs during the month, according to the Georgia Labor Department.
In any event, one month’s data can be unreliable, so the more important question is about the longer arc of the economy. And while July was a weak month, the trajectory is still positive.
A year ago, the metro Atlanta unemployment rate was 6.0 percent and since then, metro Atlanta has added 74,800 jobs.
The growth in 2016 has been slower than the past two years, but it’s not a dramatic deceleration and the longer-term trajectory still looks good.
“I think there’s a lot more juice left in this expansion cycle,” said Mekael Teshome, economist for the PNC Financial Services Group. “Atlanta is sensitive to changes in the U.S. economy and nationally, there’s a good base for continued growth.”
The jobless rate nationally is 4.9 percent, so despite the improvement, the metro Atlanta rate remains above the national unemployment rate. That’s pretty much the way it’s been nearly every month since the start of the recession in late 2007.
Here’s what is going on:
1. The unemployment rate doesn’t usually move much in July. For one thing, many companies are not in hiring mode and – perhaps aware of that — a lot of job-seekers are postponing a return to the job search until fall. And if you are not actively looking for a job, you’re not officially part of the labor force and you are not counted as unemployed.
2. While July was weak, it’s usually even weaker. In three previous years, metro Atlanta averaged job losses of 5,800 in July. There hasn’t been job gain in July since 2004.
3. Among the sectors that grew during the month: health services grew by 3,100, professional and business services expanded by 2,000, trade transportation and utilities added 1,800 and financial services added 1,300.
4. Two sectors lost jobs during the month, both losses typical of mid-summer. Government shrunk by 9,600 jobs, most of them probably connected to schools that were still closed in July. Leisure and hospitality lost 1,100 positions.
5. Layoffs were apparently up. The number of initial claims for unemployment insurance rose to 15,469 in July, up 13.5 percent from June.
6. If July is a warning, August will tell the tale.
Atlanta’s growth was faster last year and the year before than it has been in 2016. And economists say there are many economic headwinds – mostly international – that can dampen growth even more.
So the question is whether July represents a pause or an inflection point: The answer will come next month when we see whether the economy is again hitting the accelerator.
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