Economy

Economic Data Roundup (10/22/2020)

10/22/20 8:00 AM

Earlier this month we learned that the labor market continued to recover in September, and regional data out this week from the government confirmed that the stabilization again occurred across most of the country. In fact, nonfarm employment increased in 30 states last month, decreased in only three states, and essentially held steady everywhere else. As for joblessness, the unemployment rate also improved in 30 states in September, climbed in just eight states, and remained largely stable elsewhere. Most of the month-over-month uptick in joblessness occurred in the sunbelt in September while the decreases were concentrated in the northeast. For now this is mainly an expected normalization following what played out this summer rather than the start of a new trend. Nevada had the highest unemployment rate in the continental U.S. last month (12.6 percent) while Nebraska had the lowest rate (3.5 percent).

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Altogether, 27 states had jobless rates lower than the national level (7.9 percent) and 8 states had higher unemployment rates. For an additional comparison, only two states in September had a jobless rate that exceeded 11 percent, compared to eleven during the worst part of the “Great Recession.” So clearly labor market conditions have improved a lot in recent months but there is also a long way left until full recovery. Moreover, compared to this same period last year total nonfarm employment remains lower in all 50 states, and the pace of the hiring rebound going forward will depend increasingly on consumer demand. Perhaps a more timely observation is that as we near the election there are many battleground states that have experienced very different recoveries. For example, in Michigan, Nevada, and Pennsylvania the job losses compared to pre-pandemic levels are still roughly twice as severe as in Georgia, Arizona, and Iowa. Similarly, unemployment is generally a lot lower in “red” states than “blue” states. Much of the differences can be explained by regional industry mix, i.e. the service sector has been hit harder this recession than manufacturing, but whether this has any material effect on the outcome of the election remains to be seen.

 


 

Sources: Econoday, U.S. DoL, Indeed, FRBSL

Post author: Charles Couch

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