Georgia’s seasonally adjusted nonfarm employment jumped
ahead in July rising by 30,900 jobs, its largest net increase since February
2011. This sudden jump propelled the state to an over-the-year increase of
71,700 jobs or a 1.8 percent rise compared to the nation’s 1.0 percent rise
since July 2012.
Some skepticism develops in seeing this sudden good news,
and a deeper look into the numbers justify a more wait-and-see attitude. Changes
in the timing of job creation and losses undoubtedly had a factor in the
current good news, as without the seasonal adjustment factors, the state
actually lost 1,500 jobs.
The reason this translates into large job gains in the
seasonally adjusted data is the relatively small loss of jobs in July compared
to previous Julys. Over the past five years, the state has seen an average of
28,300 jobs lost each July, so this year’s 1,500 job loss translates into a
sizeable seasonal gain.
The increase is so spectacular that you want to wait until
next month’s figures are published to see if there will be any significant
modifications to the numbers. If not, then Georgia provided 1 out of every 5
new jobs created in July for the entire nation. But what seasonal adjustment
gives, it also sometimes takes away.
Most sectors in the state contributed to the overall
increase. Using seasonally adjusted data, construction led the way with a 1.8
percent rise over the month, adding 2,600 new jobs. This was followed by leisure
and hospitality services, up 1.3 percent (5,500 jobs).
Other industries with gains included retail, which added 1.2
percent more jobs, or 5,500 over the month; government up 1.1 percent (7,200); professional
and business services, up 0.8 percent (4,600); and manufacturing up 0.6 percent
(2,200).
The government sector grew despite losing 400 Federal jobs,
which was more than made up for by the addition of 1,600 state jobs and another
6,000 jobs in local government.
Unfortunately, much of this change had to do with seasonal
adjustment factors rather than real growth. For example, the seasonally
adjusted data for local government showed the sector rising by 6,000 jobs,
while the not seasonally adjusted data actually showed a drop of 16,600 jobs in
the same sector. Within the local government sector, local government
educational services lost 17,400 jobs in July before seasonal adjustment,
meaning that the non-education parts of local government had to gain a net of
800 jobs before seasonal adjustment.
This all ends up with a sense of “wait until next month” to
see if these gains hold.
Send comments to michaelwald50@gmail.com
