Saturday, July 30, 2016

Columbus, Georgia, employment problems larger than Fort Benning

When Georgia Labor Commissioner Mark Butler boasted about Georgia’s job performance in June, he wasn’t thinking about the Columbus, Georgia, area.

While Georgia has added 121,600 jobs over the past 12 months, the Columbus area has added only 500 net new jobs, resulting in an increase of 0.4%. This compares with increases of 2.8% statewide and 1.8% for the nation.

At the same time, the Columbus area’s unemployment rate of 6.6% far exceeds the state’s 5.6% rate (not seasonally adjusted) and the nation’s 5.1% rate.

With the drawdown of soldiers at Fort Benning, some are focusing on this event as the reason for the Columbus area’s poor job numbers. 

The loss of soldiers and their families in the Columbus area will have an impact, but Columbus’s employment problems well preceded recent decisions by the Army.

Columbus has shown almost flat growth since the end of the recession in June 2009. Over that seven-year time period, the area has added only 4,000 net new jobs, fewer than 600 new jobs each year.

More than 40% of them (1,700) came in the relatively low paying leisure and hospitality sector.

Since June 2015, the Columbus area has seen net job losses in the mining, logging, and construction sector, as well as in manufacturing, financial activities, and the professional and business services industries. 

In comparison, while Columbus’s job growth rose by 0.4% over these past 12 months, the Atlanta area expanded by 2.7% and the Savannah area job market has shot ahead by rising 4.1%.

One area where the differences are obvious is in professional and business services. This industry that includes companies performing professional, scientific, and technical activities for others has been one of the Atlanta area’s fastest growing industries.

Over this past year, the sector expanded by 13,900 new jobs, rising 2.9%. In the Savannah area, the growth was even more pronounced as the smaller metro area added 1,900 jobs for growth rate of 10%.

In contrast, Columbus lost a net of 200 jobs over the same 12 month-period.

Even the banking and insurance sector has seen a decline with the Columbus area shedding 100 jobs in this sector. This is particularly remarkable given the area's traditional strength in financial activities, which includes insurance carriers and banks.

While the drawdown at Fort Benning will be a blow to the area’s future, it may prove to be a benefit to the Columbus area if it focuses local leaders on the larger problems they are facing with a stagnant economy even as other parts of the state and the nation are showing significant employment progress.

Friday, July 29, 2016

Georgia’s job growth not consistent across the state

Georgia added 29,800 net new nonfarm jobs for an increase of 0.7% in the first half of 2016 and rising by 2.8% over the year, but much of that growth was concentrated in five metro areas – Atlanta, Savannah, Brunswick, Augusta, and Gainesville, Ga.

The Savannah area continues its hot streak on jobs, adding 3,900 since December for a total of 7,100 over the past 12 months, an increase of 4.1%.

Savannah’s continued job growth is propelling it towards competition with the Augusta area as the state’s second largest metro area. In June 2012, the Augusta area had 58,700 more jobs than the Savannah area. By June 2016, this difference had shrunk by 12%.

Brunswick posted the largest percentage increase for the first half of 2016, rising by 3.1%, or 1,4,00 jobs, for annual increase of 3.3%.

Meanwhile, the state’s largest metro area, Atlanta, is showing some slowdown. While the area added 15,100 jobs since December, this is slower than the numbers it posted for the first half of 2014 (30,700) and the first half of 2015 (15,400).

For the first half of 2016, the Atlanta area posted a job growth rate of 0.6%, the same rate as for the first half of 2015. Over the past 12 months, the Atlanta area added 69,400 jobs for a growth rate of 2.7%, slightly below the state’s overall rate.

Home to 60% of all nonfarm jobs in the state, any slowdown in the Atlanta area is bound to affect statewide numbers.

Hinesville and Columbus areas lagging in jobs

While Georgia continues to experience faster job growth than the nation, not all metro areas in the state are participating in this boom to the same extent. Areas of the state not feeling the effects of the enlarging economy include Hinesville and Columbus.

The Hinesville area recorded a loss of 300 jobs for the first six months of 2016 and has shown no net increase in new jobs since June 2015. The area’s job market continues to stagnate with no net increase in jobs over the past eight years.

The Columbus metro area lost 400 jobs since December partially offsetting a gain of 900 jobs from July through December for a net addition of only 500 jobs since last June. The Columbus area has seen very slow job growth since the recession, rising by only 4,600 net new jobs since June 2010, a net growth rate averaging less than 0.7% per year over the six year period.

Athens lost 100 jobs in the first six months of 2016, although a strong second half of 2015 propelled it to one of the strongest job gains among metro areas in the state for the 12 months ending in June, adding a net of 3,600 jobs for an increase of 4% since June 2015.

The Macon and Valdosta areas showed no net change in jobs since December but both areas showed good growth in the second half of 2015, resulting in 12-month job gains of 2.1% and 2.2% respectively.

Georgia’s job growth continues in the first half of 2016

For the first six months of 2016, the state added 29,800 jobs compared to 26,100 jobs for the same period in 2015, although both numbers were lower than the 37,600 jobs added in the first half of 2014 according to not seasonally adjusted data provided by the U.S. Bureau of Labor Statistics.
Although generally the job growth was seen as showing continued strength, Georgia’s percentage gain fell slightly below the nation. The first half increase represented a 0.7% rise in nonfarm jobs, compared to a 0.8% rise nationally.

Over the 12 months ending in June, the state added 121,600 jobs for an increase of 2.8% compared to a national rate of 1.8%. All numbers are before seasonal adjustment factors. Using seasonally adjusted numbers, Georgia’s over-the-year increase looked even better, rising to 2.9% since June 2015 compared to the nation’s 1.7% increase.

Looking at the over-the-year increase, Georgia Labor Commissioner Mark Butler noted that “when you compare that to the rest of the nation as a percentage growth, we’re actually doing much better than the nation on the average.”

Services and construction industries lead the way

The leisure and hospitality industry outpaced all other industries in the state during the first half of 2016, added 30,700 jobs, twice as many as professional and business services, which added 15,300 jobs for the same time period. Construction continued producing good job numbers adding 7,600 net new jobs over the past six months.

Industries recording fewer jobs over the six months through June included retailing (-11,200), state government (-6,600), and education and health services (-5,100). For these three industries, job losses in the first half of the year are not unusual and all recorded smaller losses than for the same time period last year, except education and health services.

For the 12 months ending in June, professional and business services recorded the highest number of net new jobs (32,700), followed by leisure and hospitality (24,100), retail (16,700), and construction (12,300).

Over the year, the information industry posted the only annual decline, losing 1,700 jobs or 1.6% of its employment total.

Construction and service job growth stronger in Georgia than the nation

Even as employment in the state outpaced the nation, the picture was mixed for different industries.

The remarkable growth in construction jobs in Georgia becomes more obvious when compared to the nation. Over the past 12 months, while construction jobs in Georgia grew by 7.3%, nationally industry employment rose by 3.5%.

Both the leisure and hospitality industry and the professional and business services showed much faster growth in Georgia than in the nation as a whole. Georgia’s leisure and hospitality industry employment has risen by 5.2% over the past year, while nationally the industry has grown by 2.8%.

Professional and business services employment has risen by 5.1% in the state while growing by 2.7% nationally.

Information industry falling behind in Georgia

While employment in some industries is growing faster in Georgia than the nation, other industries are seeing opposite trends.

The information industry saw the opposite trend. While the information industry in Georgia has lost 1.6% of its jobs since last June, the industry’s employment for the entire country has grown by 1.7%.

While education and health services employment in the state grew by 2% over the year, nationally, the industry posted a 3% employment growth rate.

Thursday, July 21, 2016

Workers protest outside of Federal Labor Department offices in Atlanta

The Southeast regional offices of the U.S. Department of Labor's Bureau of Labor Statistics were picketed on Wednesday by 81 employees who work for Office Resources Inc. (ORI), a contractor at the Atlanta offices of BLS.

The group was joined by Charlie Flemming, president of the Georgia AFL-CIO.

An online video of the protest is available here.

The ORI workers are fighting for their first union contract after joining the International Association of Machinists last year.

BLS contracts out part of its collection activities including telephone collection for their Job Openings and Labor Turnover Survey (JOLTS) and the Current Employment Statistics (CES) survey that produces national employment information.

The BLS Southeast Region handles data collection for a number of statistical surveys, including the Consumer Price Index, most of which are collected by federal employees led by long-time Regional Commissioner Janet Rankin.

While BLS is an agency of the U.S. Department of Labor, it has traditionally kept its distance from other USDOL agencies and tried to avoid controversial and political issues.

The agency describes itself as “the principal fact-finding agency for the Federal Government in the broad field of labor economics and statistics.”

The BLS mission “is to collect, analyze, and disseminate essential economic information to support public and private decision-making. As an independent statistical agency, BLS serves its diverse user communities by providing products and services that are objective, timely, accurate, and relevant.”

The BLS Director for Public Affairs was unavailable for comment.

Thursday, July 14, 2016

Federal judge strikes down part of Georgia’s right-to-work law

Unions in Georgia are declaring victory after Senior United States District Judge William C. O’Kelley struck down part of Georgia’s right-to-work statute as contrary to the National Labor Relations Act.

Specifically, the judge granted a summary judgment in favor of Georgia State AFL-CIO Truck Drivers & Helpers Local No. 728, and United Food and Commercial Workers Local 1996, which had challenged the state law that allowed employees to revoke their union membership at any time.

The judge struck down sections 3(d), 4, and 5 of Georgia’s right-to-work statute (Act No. 192 of the Georgia 2013 Session Laws, O.C.G.A. §§ 34-6-21, 34-6-25, and 34-6-26) as unenforceable because it conflicted with the NLRA.

The labor organizations asserted the right to engage in the collective bargaining process without state interference as well as the ability to enter into temporarily irrevocable checkoff authorization agreements pursuant to an enumerated exception in federal law.

According to the National Labor Relations Board web site,

“The NLRA allows employers and unions to enter into union-security agreements, which require all employees in a bargaining unit to become union members and begin paying union dues and fees within 30 days of being hired.

Even under a security agreement, employees who object to full union membership may continue as 'core' members and pay only that share of dues used directly for representation, such as collective bargaining and contract administration. Known as objectors, they are no longer full members but are still protected by the union contract. Unions are obligated to tell all covered employees about this option, which was created by a Supreme Court ruling and is known as the Beck right.

An employee may object to union membership on religious grounds, but in that case, must pay an amount equal to dues to a nonreligious charitable organization.

24 states have banned union-security agreements by passing so-called "right to work" laws. In these states, it is up to each employee at a workplace to decide whether or not to join the union and pay dues, even though all workers are protected by the collective bargaining agreement negotiated by the union.”

Even in those circumstances, Judge O’Kelley found that union members in Georgia could not arbitrarily stop paying union dues at will.