Signs of Tight Labor Market include Fewer Long-Term Unemployed & Falling Measures of Labor Underutilization
In June, Oregon’s nonfarm payroll employment grew by 8,500 jobs, following a gain of 2,600 in May. The June increase was the largest gain since February 2016 when 9,600 jobs were added. Gains were widespread among the major industries, with 11 of the 14 industries adding jobs. Leisure and hospitality added the most, increasing by 2,100 jobs. In addition, strong hiring occurred in construction (+1,600 jobs) and manufacturing (+1,400). Financial activities was the only major industry to cut substantially, as it shed 800 jobs.
Over the past 12 months, Oregon’s payroll employment rose 47,300, or 2.6 percent. This rapid pace was an acceleration from earlier in the year when over-the-year growth was hovering around 2.0 percent.
Oregon’s unemployment rate was little changed at 3.7 percent in June. The rate remained near its all time low of 3.6 percent reached in May. Oregon’s rate was significantly below its year-ago rate of 5.1 percent in June 2016 and well below the U.S. unemployment rate of 4.4 percent in June 2017.
Other signs of a tight labor market in Oregon include fewer long-term unemployed and falling measures of labor underutilization. The number of Oregonians who have been unemployed for more than six months dropped to 10,700 in June, the lowest on record dating back to 2002. In contrast, the long term unemployed reached a peak of more than 100,000 in 2010, during the aftermath of the Great Recession.
Meanwhile, U-6–the broadest measure of labor underutilization, which includes the unemployed, those who have stopped looking for work within the last year but still want a job, and those who are working part-time but would prefer to work full-time–dropped to 7.4 percent in June. This was by far Oregon’s lowest U-6 since comparable records began in 2002, and was a continuation of its downward trend since reaching a peak of 21.1 percent in May 2009. In recent months, Oregon’s labor market tightened so rapidly that Oregon’s U-6 dropped below the national U-6 of 8.6 percent in June 2017.
