Job Picture Brightens in Pima County, Statewide

By Howard Fischer


November 19, 2010

PHOENIX – The state’s economy is showing signs of life.

New figures Thursday from the Arizona Department of Commerce put the jobless rate for October at 9.5 percent on a seasonally adjusted basis. That’s down 0.2 percentage points from the prior month but still up from a year ago.

Pima County’s unemployment rate was 8.3 percent last month, down 0.3 percentage points from September, as well as when compared with October 2009.

But Aruna Murthy, the agency’s director of economic analysis, said it isn’t the pure number – and the small drop – that provides the optimism. After all, the rate has bounced around that figure all year.

What’s different this time, she said, is that employment in a majority of the industry sectors is higher now than it was a year earlier. Even the beleaguered construction industry posted its first year-over-year gain since December 2006.

And Arizona’s rate of job growth, which was at or near the bottom among all states last year, now is trending above the national average.

The good news can’t come fast enough.

A separate report Thursday from the Bureau of Economic Analysis shows that the state’s gross domestic product declined faster last year than the national average. It was down 3.9 percent, compared with the national drop of 2.1 percent.

The gross domestic product is calculated as the sum of what consumers, businesses and government spend on final goods and services, plus investment and net foreign trade.

And the trend is not good.

This report also puts the per capita GDP figure for Arizona at $35,313 last year, just 84 percent of the national figure. That’s down from 86 percent in 2008 and 89 percent in each of the two years before that.

It also means Arizona’s per capita GDP ranking is now 39th in the nation. In 2006, it stood at 32nd.

Murthy said the state’s below-average ranking is not a surprise.

“Arizona as a state has been a low-cost state in terms of wages,” she said. That is based largely on the fact that Arizona’s employment comes largely from lower-paying industries such as leisure and hospitality.

“But that doesn’t mean, going forward, that’s how it will look,” Murthy said. The key, she said, is what kind of new jobs the state can attract.

Lawmakers and the governor already are weighing several proposals to revamp Arizona’s property-tax system, which is considered particularly unfriendly to the manufacturing industry, a sector that generally pays higher-than-average wages.

On the current employment front, the improvement appears to be fairly widespread.

Maricopa County saw its seasonally adjusted jobless rate drop 0.2 points to 8.3 percent. And some other counties also joined Pima and Maricopa in seeing a decline in employment.

Murthy said there was especially strong job growth in trade.

Retail trade employment was 4,900 higher in October than in the month before, and up by 7,000 jobs from the same time a year earlier. Wholesale trade also posted an 1,800 month-over-month job gain, with employment 4,800 jobs higher than in October 2009.

“That itself is an indication that people are beginning to feel a little bit more confident and beginning to spend,” she said. Employment was up in almost all retail sectors, ranging from home furnishings and building materials to department stores.

Murthy said some of this may be early signs of a good Christmas season.

But the spending is not being limited to gifts.

There also are indications that Arizonans are willing to go out to eat more. Employment in restaurants and bars was up by 1,300 from September to October, and 2,700 higher than last year.

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