It’s been 11 years since the Buffalo Niagara region’s unemployment rate was as low as May’s 4.3 percent
A slowly shrinking pool of available workers, caused by a wave of baby boomers retiring, is making it harder for companies to find workers at a time when the economy is strong and businesses are looking to hire. And hire they are, cutting further into the pool of available workers and driving unemployment sharply lower.
That hiring was especially apparent last month, as the weather improved markedly in May, following a gloomy April, that compressed seasonal job growth into a brief period.
The drop in the unemployment rate also mirrors the healthy labor trends in a separate report last week from the Department of Labor showing that the region added jobs at a 1.6 percent annualized pace during May. The two sets of job data, however, are compiled from different surveys.
The May jobless rate dropped to an 11-year low of 4.3 percent as fewer people seek work and employment grew.
There are plenty of “help wanted” signs on display at local businesses. Combine that with fewer workers looking for jobs, and it’s a prescription for a lower unemployment rate.
“We have a very strong economy, and we’re butting up against a labor shortage,” said John Slenker, the state Department of Labor’s regional economist in Buffalo. “We’re running up against full employment.”
The Buffalo Niagara labor force is shrinking, too.
While hiring has been steady, the region’s labor pool now is smaller than it’s been since at least 1990. So as 2,100 new people found jobs in May, the number of workers who were actively looking for a job but couldn’t find one shrunk to a 16-year low for May.
“Most of this is being caused by the baby boomers retiring,” Slenker said.
“That’s why we have this labor shortage,” he said. “It literally makes it a job-seeker’s market.
Unemployment across the Buffalo Niagara region is higher than it is across most of New York and the rest of the country – even after May’s big drop.
The region’s jobless rate is higher than both the statewide and national averages. Among the state’s 15 biggest metro areas, the Buffalo Niagara unemployment rate is tied for the 11th highest, better only than Binghamton, Elmira and Watertown.