Monday, July 20, 2020

Job openings and separations in Georgia, 1st Quarter 2020


Compared to the nation, at the end of March, Georgia recorded a higher level of job openings, hires, and quits while posting a lower rate of total separations.

Experimental state-level data provided by the U.S. Bureau of Labor Statistics suggests that the Coronavirus (COVID-19) pandemic impact started later in the state than in the nation as a whole.

Job Openings

In the 1st quarter of 2020, Georgia recorded 656,000 employment openings compared to 680,000 in the 1st quarter of 2019.  Job openings for the first two months of 2020 were comparable to those in the first two months of 2019 but then dropped by 27,000 in March of 2020 compared to March 2019.

The state’s openings rate stood at 4.3% at the end of the 1st quarter compared to a 4.9% rate in the 1st quarter of 2019.

At the end of March, the national job openings rate stood at 3.7%.

Hires

The number of hires increased by 15,000 in the 1st quarter compared to the 1st quarter of the previous year. Hiring remained steady throughout all three months of 2020.

The hiring rate at the end of March stood at 3.7%, the same as at the end of March 2019.

Nationally, the hire rate ended the quarter at 3.1%.

Separations

Total separations include quits, layoffs and discharges, and other separations. Total separations is
referred to as turnover. Quits are generally voluntary separations initiated by the employee. 

Therefore, the quits rate can serve as a measure of workers’ willingness or ability to leave jobs. Layoffs and discharges are involuntary separations initiated by the employer.

Separations totaled 638,000 in the 1st quarter with separations rising each month in 2020 compared to the same three months in 2019. Separations in the 1st quarter of 2019 equaled 516,000.

At the end of March, the total separations rate was 5.4% compared to 3.7% in March 2019. For the nation, the total separations rate at the end of the 1st quarter was 9.3% compared to a 3.3% rate in March 2019.

Both the number of quits as well as layoffs and discharges in Georgia rose each of the first three months of 2020 compared to the first three months of 2019.

For the 1st quarter of 2020, the number of quits equaled 349,000, while the number of layoffs and discharges came to 258,000.

For the 1st quarter of the previous year, the number of quits totaled 315,000 while the number of layoffs and discharges reached 157,000.

At the end March 2020, the quits rate was 2.4%, the same as in March 2019, while the layoffs and discharges rate rose to 2.8% compared to 1.1% in March 2019.

For the nation, the quits rate stood at 1.6% and the layoffs and discharge rate was 7.4% at the end of March.

About state-level JOLTS data

Job Openings and Labor Turnover Survey (JOLTS) estimates are based on a national sample of approximately 16,000 establishments. These data are used by policymakers, academics, industry experts, economists, and others to better understand the current state of the U.S. economy and to understand the dynamic activity of businesses in the economy that lead to aggregate employment changes.

While the current national sample size is designed to support estimates for major industries at the national level and total nonfarm estimates at the regional level, the Bureau of Labor Statistics (BLS) is currently researching the possibility of leveraging the sample to produce model-assisted estimates at the state total nonfarm level. These estimates are currently identified as experimental as updates to the models are incorporated into this new data series.

BLS is encouraging data users to review these estimates and provide input on both the technical aspects of the models and on the usability of the resulting data.

More information can be found at https://www.bls.gov/jlt/jlt_statedata.htm.

Table A. Job openings, hires, quits, layoffs and discharges, and total separations rates for United States and Georgia, as of March 2020


Rates in Percent
Area
Job Openings Rate
Hires Rate
Quits Rate
Layoffs & Discharges Rate
Total Separations Rate
United States
3.7
3.1
1.6
7.4
9.3
Georgia
4.3
3.7
2.4
2.8
5.4




Saturday, July 18, 2020

Georgia job increases in May and June fail to offset losses in April

Nonfarm Employment in Georgia, January-June 2020
Source: U.S. Bureau of Labor Statistics

Georgia saw 248,300 fewer jobs in the 2nd quarter of 2020 compared to the 1st quarter of the year. The unemployment rate fell to 7.6% in June, down from its May rate of 9.4%.

Georgia Labor Commissioner Mark Butler was quoted as saying: “June was the first month to show positive numbers in all major indicators since the pandemic started. Although it is nice to see the pendulum move in the right direction, we are not na├»ve to the fact that we may see another tick up in claims over the next few months. We will continue to work unemployment claims both new and continued to ensure all Georgians are being taken care of during these unprecedented times.”

At the end of the 2nd quarter, employment in Georgia stood at 4,370,300 jobs having given up all the job gains it had made in the past four years.

In June, employment grew by 150,200 jobs, the second consecutive month of job growth after posting a revised net growth of 99,600 jobs in May.

Despite the two months of increases, there was net job loss for the quarter as growth in May and June could not overcome the loss of 498,100 jobs in April.

Over the past 12 months, the state has suffered a net loss of 239,800 jobs, its largest net loss of jobs since 2009.

Unemployment

The state’s unemployment rate remained elevated compared to the state’s 3.5% unemployment rate in June 2019. The percentage of the population employed in June rose to 54.9% up from 53.5% in May. A year ago, the state’s employment-population ratio stood at 60.0%.

In June, the number of unemployed in the state stood at 373,404, also a decrease from the numbers posted in April and May.

Employment by industry

While nearly all industries posted improvements in June compared to their April and May losses, nearly all industries showed job declines over the quarter.

Overall, the private sector posted a net loss of 226,200 jobs in the second quarter with significant quarterly net losses in the leisure and hospitality sector (-88,100), the professional and business services industry (-38,000), and in health care and social assistance (-18,500).

Although nearly every industry posted job gains in June, one exception was state government, which showed a net loss of 500 jobs in June. For the quarter, state government employment declined by 7,200. 

Only federal government employment in the state showed improvements over the quarter, rising by a net of 900 jobs in the 2nd quarter.

Sunday, July 12, 2020

Georgia pays out record unemployment claims even as number of initial claims declines


The Georgia Department of Labor paid out a record amount of unemployment insurance benefits in the shortened July 4th week. The payments in the holiday-shortened week were almost 3x the amount issued for all of 2019.

Georgia Unemployment Rate, Seasonally Adjusted


Regular state and federal unemployment insurance benefit payments totaled over $857 million. Since mid-March, total unemployment benefits payments in Georgia have exceeded $8.5 billion.

In the first week of July, $148,071,716 in regular weekly state unemployment benefits were paid. Since March 21, over $2 billion has been paid in regular state unemployment insurance benefits.

The news comes even as Georgia reports a drop in initial claims for unemployment with 13,985 fewer initial claims in the week ending July 4th than in the previous week. For the week, initial claims totaled 103,590.

For the week ending June 20, the state counted a total of 661,233 people on its insured unemployment rolls compared to 24,973 for the same week in June 2019.

Georgia Unemployment Insurance Fund

Although the federal goverment is covering much of the cost of unemployment benefits currently through the month of July, regular state unemployment benefits continue to be paid by the state and are funded through a tax on employers. 

Normally, the rate an employer pays into the fund is based on their experience rating -- the number of workers drawing unemployment from a given employer.

As the state draws down the money in its unemployment insurance fund, it needs to determine if rates need to increase so the fund does not run out of money. Georgia has already decided that Covid-19-related claims will not be counted when calculating experience ratings.

Some states have already asked the federal government for assistance because their drawdowns of their unemployment insurance funds are already running low.

In Georgia’s case, despite the recent spike in claims, the state’s unemployment insurance fund remains solvent. Georgia is estimated to have sufficient funds to be able to pay between 1.0 to 1.5 years of benefits associated with an average recessionary period.

Solvency of State Unemployment Insurnace Funds Ability to Pay Over 12 Months 
Based on An Average Recession, as of January 2020



Looking ahead to 2021

Although Georgia’s unemployment fund is currently in good shape, it will need to be replenished. 

After the last recession, Georgia reduced the number of weeks for unemployment benefits from 26 to 14 weeks to reduce the need to increase taxes on employers.

Assuming that the state’s economy will not quickly recover from the current economic downturn, in 2021, the state will have to consider another reduction in benefits coverage, higher taxes on employers, lower weekly payout rates, or a combination of these options.

In addition to needing to rebuild the fund, there will be pressure to modernize the system, as workers complained that the current system left them without benefits for multiple weeks due to breakdowns in the processing system. The state will need to determine whether its computer infrastructure needs t be modernized or replaced and if so, how to pay for the changes.

Not only is the current downturn stressing employers and employees, it is also putting pressure on state politicians next year to find ways to rebuild the state’s unemployment insurance system so it can better serve employers and workers in the future.