Georgia nonfarm employment, Jan-Sep 2017, in thousands, seasonally adjusted
Nobody was surprised when Georgia’s employment numbers for
September showed a 500-job loss, after seasonal adjustment. Most blamed it on
Irma, which hit Florida as a hurricane and was downgraded to a tropical storm
by the time it came through Georgia.
State Labor Commissioner Mark Butler told WUGA
that the storm caused Georgia’s job numbers to fall and unemployment claims to
rise in September. Butler said a 240 percent jump for the month in the coastal
region drove the state’s numbers to some degree.
“It wasn’t because of some kind of economic issue that
happened where there was some problem with the economy,” according to Butler. “Most
of what we saw with the jobs and initial claims has to do with the storm.”
It is true that the largest disruptions occurred in the
Savannah area, which experienced a mandatory evacuation although the storm
itself failed to seriously impact the coastal area.
If the job losses were storm-related, then temporary and contract
employment should have shown the greatest losses. These jobs lack the security
of regular employment and so are the most likely to be impacted when businesses
suddenly stop operations even for a few days.
Unfortunately, in September, employment services in the
state actually gained 5,300 jobs in September, before seasonal adjustment. That
is above the 4,600 jobs gained in September 2016 when there was no storm.
Job losses
concentrated in three industries partially offset by gains in two others
Georgia’s job losses in September were concentrated in
three key industries: construction, manufacturing, and retail trade.
Construction jobs fell by 3,600 over the month, followed
by a 2,900 job decline in retail trade and a 2,800 job drop in manufacturing.
The reason overall losses were not larger can be
attributed to gains in education and health services (+4,200) and leisure and
hospitality (+2,800).
Again, if the tropical storm had caused significant job
losses, leisure and hospitality would have been one of the key industries to
suffer.
It is possible some construction jobs were lost due to
the inclement weather, but even if they were, that would not explain the loss
of manufacturing or retail jobs in September.
On the other hand, manufacturing might represent not a
loss of manufacturing activity, but a decreased need to hire more people as
automation takes on a larger role in the manufacturing process.
For retail, job losses might reflect the increasing effect
of the internet and online purchasing. Retailers are being cautious as they see
online sales rise.
Looking ahead to Christmas, there is sure to be seasonal
hiring in the months of October and November, but it is possible to see a
continued decline in retail jobs after the first of the year.
One month does not
make a trend
Monthly numbers are subject to wide variations
month-to-month, despite the Bureau of Labor Statistics’s attempts smooth out
the changes using seasonal adjustment factors.
It is too soon to say whether the losses in September
represent something significant, but it is worth watching future months.
Expect to see some job pick-up in construction from
storm-related repairs, and a boost in October before settling down to more
usual numbers in November.
Then we will be able to see if September was a fluke
or the beginning of a trend.
