Don’t be fooled by the minus sign — metro Atlanta’s economy jumped off to a much better start to the year than it usually does.
Yes, the region lost jobs during January as retail and logistics companies let go of workers hired for the holidays and many other companies held back from hiring as they planned out their yearly budgets with an eye on interest rates.
But that jobs negative was the second-smallest on record for a January, the Georgia Department of Labor reported Thursday.
“Despite a nationwide pandemic and challenging economic times, continued investments in Georgia’s labor force and a thriving business community have kept our economy strong,” said Commissioner Bruce Thompson.
The sectors with the most job losses during the month were predictable: retail shed 9,600 positions and logistics shrunk by 5,200.
In contrast, there was growth of 2,500 jobs in the information sector, which includes film production. And while hospitality lost some ground in January, the sector is 11% larger than a year ago with 296,000 workers, according to the Bureau of Labor Statistics.
And though the region’s unemployment rate rose from 2.6% in December to 3.2%, even that was at least partly a positive: more than 12,000 people entered the labor force, often a sign that people without work believe there are jobs to be had.
Even with the slippage in January, the region has added 117,500 jobs in the past 12 months, according to the Department of Labor. Moreover, February is historically good month, averaging the addition of 4,835 jobs.
Still, prospects for the rest of 2023 are clouded by larger worries about interest rates and inflation, with hiring plans complicated by the Federal Reserve’s determination to stamp out inflation by raising interest rates and slowing the economy.
While the collapse of Silicon Valley Bank last week might cause the Fed to postpone the next rate hike, the 16 months of increases has at least dampened the labor market.
With more than 3 million jobs, metro Atlanta accounts for 62% of the state’s positions.
What had been a surging tech sector has seen slumping demand for many skills, said Lori Sargent, Atlanta-based senior vice president of staffing company Randstad Enterprise Group. “We are seeing a slowdown in the IT space.”
Layoffs have been announced at a slew of high-profile companies, including Google, Meta, Amazon, Microsoft, Salesforce and Atlanta-based Greenlight Financial.
Moreover, it’s not just techies feeling a shift in the air, she said.
Workers who a year ago were quick to leave a job for better wages or hours are more likely now to stick with what they think is a dependable paycheck, Sargent said. “Last year it wasn’t hard to get people to jump ship if we were willing to pay them the money they wanted. Right now, people are not as quick to jump ship.”
That change is also reflected in a decline in the number of jobs listed as open, said Daniel Altman, chief economist for Instawork, which connects businesses and people who want flexible, hourly work.
“The Fed has created uncertainty,” he said. “That has made some businesses reluctant to hire.”
Pessimists worry that the Fed seems willing to cause a recession and millions of job losses if that is what it takes to cut inflation to what it considers acceptable. But with inflation down from last summer’s crest, there continues to be hope that deep pain is not needed.
Spurring hope of “a soft landing” are data that show the current economy looking very much like it did before the pandemic, back when inflation was low, Altman said.
The share of people in their prime who are working has risen back to where it was in Feb. 2020, while the unemployment rate remains historically low, he said. “A soft landing is still on the table.”
Five things to know about metro Atlanta’s jobs report
1. There are always job losses in January as retail and logistics companies let go of workers hired just for the holidays.
2. The losses this year were far fewer than usual. This was the second-best January on record.
3. Atlanta’s unemployment rate edged up, partly because of those seasonal layoffs, but also because of growth in the labor force — that is, the number of people looking for work.
4. Growth in the labor force is a sign that many people who had not been working think there are jobs to be had.
5. The sectors with the most job loss in January were retail and transportation and warehousing, that is, logistics.
Fewest loses in January, metro Atlanta
1. 2019: -29,800
2. 2023: -30,100
3. 2005: -35,100
4. 2013: -35,500
5. 2021: -35,800
Sectors with worst job losses, January 2023
Retail: -9,600
Logistics: -5,200
Sector with job gains, January 2023
Information: 2,540
Labor force* change, January
Average, pre-pandemic: -4,720 (2000-2019)
Recent: 12,564 (2023)
Unemployment** rate
Lowest, pre-pandemic: 2.6% (Dec. 2000)
Highest, pre-pandemic: 11.1% (June 2009)
Recent: 3.2% (Jan. 2023)
Previous: 2.6% (Dec. 2022)
*Labor force includes all people either working or actively seeking a job.
**Unemployment includes only those without a job who are actively searching for work.
Sources: Bureau of Labor Statistics, Georgia Department of Labor
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