There’s always the tendency to be a bit cautious when touting low unemployment numbers, but a recent report showing that the Buffalo Niagara job market is better for job seekers now than in nine years feels like good news.
Many factors influence the ups and downs in unemployment numbers. As News business reporter David Robinson noted, moderate job growth is underway; there is also a shrinking labor pool largely due to a stagnant population and a wave of retirements. Individuals who wanted to retire years ago but were stymied by the Great Recession and a hobbled stock market are finally well enough off to retire.
For those who remain in the labor market, the outlook is at least more optimistic.
The region’s unemployment rate hit 4.5 percent during June, below 5 percent “for the second straight month and the third time since the recession began nine years ago,” according to information from the state Labor Department. The unemployment rate is nearly a full percentage point lower than it was a year ago.
John Slenker, the Labor Department’s regional economist in Buffalo, said that the current situation “bodes well for the rest of the year.” That is, looking at what usually occurs during the summer months – unemployment tends to rise from June to July as seasonal hiring slows – and decreases again in August and September.
Hiring is slowly growing among local employers while the labor force is shrinking. The drop in the unemployment rate from June 2015 to June 2016 was one of the biggest such drops in the past 26 years, as Robinson explained. Hence, the jobless rate is at its lowest point for any June since 2001. And the month’s 4.5 percent unemployment rate is within range of the region’s modern-day low for the month: 4.1 percent in June 2000.
It is easy to understand the urge to latch onto what is arguably good news about the unemployment rate. It would be better if the rate was dropping because a booming economy was generating thousands of jobs.
The low unemployment rate within the context of a stagnant population points to the need to attract young workers from the outside to fill openings that will become available. But it also bodes well for those already here and looking for work.