New state employment numbers released today show that Massachusetts lost 7,100 jobs in September, adding to evidence of a third-quarter economic slowdown.
National employment has also weakened, and AIM’s Business Confidence Index declined in August and September.
The new preliminary data, prepared by the federal Bureau of Labor Statistics, puts the Massachusetts unemployment rate at 4.6 percent, a tenth below the August reading and a point below last September’s. The national unemployment rate in September was 5.1 percent.
The longer-term picture of Massachusetts employment remains positive – the state has added 46,900 jobs so far in 2015, and 67,200 year-over-year. The month-to-month figures are by contrast negative, with job losses in the Education and Health Services, Trade, Transportation and Utilities, Construction, and Manufacturing sectors. The labor-force participation rate was down, and so was the total labor force. The state’s apparent slowdown from a recent strong growth trend is a natural result of a weakening national economy and adverse global conditions.
The monthly employment report provides relatively current information about the state’s economy, but some of its limitations are on display this month. Most obviously, the two headline numbers conflict: the unemployment rate is down to 4.6 percent, but 7,100 jobs were lost.
The Massachusetts Executive Office of Labor and Workforce Development emphasizes job gains year-to-date (i.e., under the current administration) rather than year-over-year. The year-over-year job gains, moreover, are very different in the employer survey (+67,200) and the household survey (+32,500). This is without getting into the alternative measures of unemployment, or the fact that some expert observers believe that the state’s reported employment growth this year may have been overestimated.
Also released today was broader perspective on the condition and future of the Massachusetts economy from the New England Economic Partnership, prepared by Alan Clayton-Matthews of Northeastern University, a member of AIM’s Board of Economic Advisors. Likening the state’s recent growth to that of the boom of the 1990s, Clayton-Matthews forecasts an average gain of 50,000 jobs yearly for 2015-18, with unemployment falling to 4.1 percent and total wages and salaries rising in the 5 percent to 6 percent range. This positive outlook implies its own set of challenges for employers, who will confront a more competitive labor market than they have seen in 15 years.