The latest employment report is out and most importantly the annual benchmark revision has been released and shows more jobs added in 2013 than originally thought. This is right inline with our forecast, but is good and better news than the preliminary data indicated. As Employment’s Nick Beleiciks wrote a couple months back: Finally some real growth. As our office is wont to do, now for some graphs!
This first graph is an update comparing recessions in Oregon’s post-WWII history. We’re now just a little bit better than the recovery coming out of the early 1980s recession, but just barely. Based on our office’s latest forecast, Oregon is now just about 1 year away from regaining all of the recessionary job losses. We’re getting there.
In terms of the number of jobs being added, right now the state is at three-quarters throttle. The just more than 40,000 annual pace is effectively on par with the gains seen last decade but a notch below the 1990s gains. The improvement in the pace of recovery in 2013 is clearly evident in the graph as more regions of the state came online. We’re getting there.
While the number of jobs being added is picking up, so too is the growth rate. We’re up to a 2.7% pace in January, over the past year. In a historical context this is still a subdued rate of growth, but we’re up to about a three-quarters throttle rate here as well. We’re getting there.
Right now our baseline forecast calls for about this same rate of growth over the next couple of years. It’s a big improvement over the growth seen during the early stages of recovery but not as strong as the typical expansion in Oregon. Are we too pessimistic? Can job growth reach 3-4%? If even more regions of the state improve (Lane County in particular), and there is a stronger cyclical rate of growth due to, say, household deleveraging is complete and/or corporations invest more, absolutely. However, slow growth coming out a financial crisis is the norm and the demographic trends moving forward will weigh considerably on growth rates as the Baby Boomers retire en masse. Our office is optimistic about the outlook, we just believe these larger forces will hold us back from the full, typical expansion rates of growth. And yes, overall we are getting there.