Bill Morris: This glass looks half-full to me!

This glass looks half-full to me!

Lead story in today's Business section in the Austin American-Statesman:

Job plunge in January is steepest of recession

Sensational?  Yes.

True?  Not so much.

I have reviewed the Texas Workforce Commission report that apparently was the basis for the article:

TWC Report 03/04/2010

It does indeed show a 7.6% unemployment rate in the Austin area in January 2010, compared to a 6.5% rate in January 2009.  It does not show a loss of 10,000 jobs over that period as stated in the Statesman article.  Instead, TWC reported a total of 833,400 jobs in the Austin-Round Rock metro area in January 2010, versus 813,200 in January 2009.  My calculator says that is a gain of more than 20,000 jobs!

It seems the reason the unemployment rate went up is that the civilian labor force in the area grew by 32,200!  As I have been writing for months, Austin continues to attract employers and net in-migration.  As it happens, we are attracting people who see opportunity here faster than the jobs they need are being created.  The Statesman noted that seasonal retail workers are typically laid off in January, contributing to higher unemployment.  Even with that, though, we gained jobs month-to-month and year-over-year.

"Steepest [decline] of recession"?  I suppose there is some legitimate debate about when the downturn began, but this statement just didn't ring true to me, so I went back to the source again -- the Texas Workforce Commission.  For readers who prefer graphs, here is a look at Austin metro employment from January 2005 through January 2010:

Austin Employment 2005-2010 (Graph)

You will notice that the definition of the "metro area" being measured varies from one report to the other, but this information taken directly from the TWC website shows that Austin actually gained jobs from December 2009 to January 2010, and from January 2009 to January 2010.  So does the press release posted at the beginning of this article.  The attached graphs both include 3-month moving average trendlines to help with interpretation, and the direction of change in Austin employment during 2009 is clear.

If you're interested in monthly details, that is available here:

Austin Employment 2005-2010 (Data)

It turns out that the largest monthly loss of jobs in the past five years was from December 2008 to January 2009 -- 12,374 jobs, or a 3.1% contraction.  That compares to growth of 0.4% from December 2009 to January 2010.  Interestingly, instead of being the "steepest plunge" this was the only time in five years that we did not experience a loss of jobs from December to January!

Perhaps the Statesman reporter dug deeper or had more data than I found this morning, but while Austin has certainly felt the effects of the recession, I see good news in the TWC data.  Admittedly, I am a "glass is half full" kind of guy, but I can't figure out how to interpret that actual data negatively!

Bill F. Morris, ABR, CRS, CDPE, e-PRO, MBA
RE/MAX Capital City
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Comment balloon 0 commentsBill Morris • March 05 2010 01:43PM

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