1. 1 The Washington Labor Market: Is This a Recovery or What? To: Manufacturing and Wholesale Distribution Summit By Greg Weeks, Ph.D., Director of Labor Market & Economic Analysis September 14-15, 2010 Olympia, WA

2. 2 2 Recessions History and Summary PeakTrough % Job Change, US % Job Change, WADurationComment 1948 - Nov1949 - Oct-5.0% 11 1953 - Jul1954 - May-3.1%-1.0%10 1957 - Aug1958 - Apr-4.0%-3.8%8 1960 - Apr1961 - Feb-2.3%-1.9%10 1969 - Dec1970 - Nov-1.2%-5.3%11 1973 - Nov1975 - Mar-1.6%-4.2%16 1980 - Jan1982 - Nov-2.2%-3.6%34A double Dip 1990 - Jul1991 - Mar-1.1%1.0%8 2001 - Mar2001 - Nov-1.2%-1.9%8 2007 - Dec2009 - Dec-6.1%-6.5%24Started 2/08 in WA 2009 - Dec2010 - Jul0.5%0.7%7Recovery? Timing of 2007 recession and recovery unofficial, by author

3. 3 * Mortgage Foreclosures Started: Nevada –NSA, % Mortgage Foreclosures Started: Arizona –NSA, % mortforclosure.EMF (MBAMTG) NVL14F / AZL14F 993-1102 Though foreclosures spiked in Washington, it was far less than in states with a bigger housing “bubble”

4. 4 * NASDAQ Composite Market Capitalization –Billions, $ NYSE Market Capitalization: –Billions.$ mktcatnysenasdaq.EMF (USECON) SPNACAP / SPNYCAPH 9909-11008 Between these equity losses in value and home prices, US households lost nearly a year’s GDP in paper wealth

5. 5 * US Quarterly Housing Starts: 1 Unit Structures – 4-qtr Change Not Seasonally Adjusted, Thous.Units ushsingstarts.EMF (USECON) HST1Q 993-1102 These data show the effects of the real estate financial crisis

6. 6 * Conference Board: Consumer Confidence –SA, 1985=100 consconf.EMF (USECON) CCIN 7709- 11008 Consumer confidence has recovered from record lows to “normal” recessionary levels

7. 7 * Nonagricultural Employment, Washington –Seasonally Adjusted, Thousands Nonfarm Employment, US –Seasonally Agjusted, Thousands nonaguswa.EMF (LABORR) WALNAGRA / LANAGRA 9909-11008 The recession hit both the nation and the state about equally hard

8. 8 * Nonfarm Employment, US (Dec. 2007 = 100) –Seasonally Agjusted Nonagricultural Employment, Washington (Dec. 2007 = 100) –Seasonally Adjusted LANAGRAindex.EMF (LABORR) LANAGRA / WALNAGRA 9909-11008 Both Washington and the US shed over 6% of their jobs in the recession

9. 9 * Unemployment Rate, United States –Seasonally Adjusted, % Unemployment Rate, Washington –Seasonally Adjusted, % WAUSUR.EMF (EMPLR) USRA / WARA 9909-11008 The Washington state unemployment rate has been just below the national rate throughout the recession

10. 10 * Unemployment Rate, United States –Seasonally Adjusted, % Unemployment Rate, Washington –Seasonally Adjusted, % USRALon gterm.EMF (EMPLR) USRA / WARA 7509-11008 Much of Washington’s recent history has seen its unemployment rate exceed the national rate

11. 11 * Unemployment Rate, Washington (Seasonally Adjusted, %) –SA, % Unemployment Rate, Oregon –SA, % atatesurs.EMF (EMPLR) WARA / ORRA 9908-11007 Washington near the middle of the pack among state unemployment rates

12. 12 * Civilian Unemployment Rate: Women, 16 Years + –SA, % Civilian Unemployment Rate: Men, 16 Years + –SA, % MENWOMENUE.EMF (USECON) LRWT16 / LRMT16 9909-11008 This recession hit men harder than women, US data

13. 13 * U.Rate: College Graduates: 25+ Years –SA, % U.Rate: < Bachelor's Degree: 25+ Years –SA, % ueeduc.EMF (USECON) LRCLG25 / LRLBA25 9909-11008 Recession hit less educated much harder, US data

14. 14 * Civilians Unemployed for 27 Weeks and Over –Seasonally Adjusted, Thousands Civilians Unemployed for Less Than 5 Weeks –Seasonally Adjusted, Thousands durationUI.EMF (USECON) LUT27 / LU0 9909-11008 Nationally, this recession was associated with unprecedented numbers of long term unemployed

15. 15 * + Part Time Econ Reasons –SA,% + Marginally Attached –SA, % usaltmeasures.EMF (USECON) MLU6 / MLU5 9909-11008 US measures of labor underutilization: what is the “real” unemployment rate?

16. 16 State measures of labor underutilization: What is the “real” unemployment rate?

17. 17 * U. Rate: Wholesale and Retail Trade, US –NSA, % U.Rate: Manufacturing,, US –NSA, % urmanwholesconstr.EMF (USECON) LRNAWRTN / LRNAMGN 9909-11008 Construction and manufacturing industries hit particularly hard

18. 18 * Wholesale Trade Employment (Thousands) –SA, Thous Manufacturing Employment (Thousands) –SA, Thous constmanwhole.EMF (USECON) LAWTRDA / LAMANUA 9909-11008 Construction and manufacturing shed over four million jobs during the recession

19. 19 * US Wholesale Trade Employment, Decmber 2007 = 100 –200712=100 US Manufacturing Employment, December 2007 = 100 –200712=100 manconstwtusindex.EMF (USECON) LAWTRDA / LAMANUA 9909-11008 Nationally, construction employment dropped 25% while manufacturing shed 15% of its employment

20. 20 * Washington Durable Goods Mfg. Employment –SA Washington Non-Durable Goods Mfg. Employment –Seasonally Adjusted wadurnondurmanempl.EMF (WACES) WAADURG / WAANDUR 9008-11007 Durable manufactured goods more cyclical than nondurable manufactured goods

21. 21 * Mfrs' Shipments: All Manufacturing Industries –Seasonally Adjusted, Millions $ All Employees: Manufacturing –Seasonally Adjusted, Thousands manempshpmnts.EMF (USECON) NMS / LAMANUA 6009-11008 Manufacturers shipments have recovered more than employment

22. 22 * US Wholesale Trade Employment (left) –Seasonally Adjusted, Thousands US Merchant Wholesale Sales: (right) –Seasonally Adjusted, Millions $ whlsemplsales.EMF (LABORR) LAWTRDA / NWSH 7009-11008 Nationally, wholesale sales have recovered stronger than employment

23. 23 * All Employees: Wholesale Trade, Washington – 3-month avg Change SA All Employees: Wholesale Trade, Washington – 1-month Change SA wholesalechange.EMF (WACES) WAAWTRD / WAAWTRD 9908-11007 Anemic recovery in wholesale trade employment

24. 24 * All Employees: Total Nonfarm, Washington – 3-month avg Change SA All Employees: Total Nonfarm, Washington – 1-month Change SA WAnonfarmchange.EMF (WACES) WAANAGR / WAANAGR 9808-11007 Washington state lost 192,700 jobs during the recession (Feb 2008 – Dec 2009)

25. 25 * All Employees: Service-Providing, Washington –200712=100 All Employees: Goods-Producing, Washington –200712=100 goodssvcWAindex.EMF (WACES) WAASERP / WAAGOOD 9908-11007 Within the state, the goods producing industries dropped about one-fifth of their employment

26. 26 * All Employees: Manufacturing, Washington –200712=100 All Employees: Construction, Washington –200712=100 manconstindexWA.EMF (LABORR) WALMANUA / WALCONSA 9908-11007 In Washington, construction lost over 35% of its employment while manufacturing dropped 15%

27. 27 * Washington Professional & Business Svces Employment –SA Washington: Retail Trade Employment –Seasonally Adjusted profbussrvsnretailempl.EMF (WACES) WAAPBSV / WAARTRD 9008-11007 These industries may have bottomed out

28. 28 * All Employees: Educational & Health Svcs, Washington –SA All Employees: Information, Washington –SA educhealthninfoWA.EMF (WACES) WAAEDUH / WAAINFO 9008-11007 These industries weathered the recession with no major job losses

29. 29 * US Professional & Business Service Employment –December 2007 = 100 US Retail Trade Employment –December 2007 = 100 busservretail usindex.EMF (USECON) LAPBSVA / LARTRDA 9909-11008 These industries lost about eight percent of their employment, but business services is stronger lately

30. 30 * WA Specialty Trade Contractors, Dec. 2007 = 100 –200712=100 WA Hvy and Civil Engineering Constr, Dec. 2007 = 100 –200712=100 WAconsttypes.EMF (WACES) WAAD8 / WAAD7 9908-11007 Washington heavy and civil engineering construction employment may have bottomed out

31. 31 * All Employees: Leisure & Hospitality, Washington –December 2007 = 100 All Employees: Educational & Health Svcs, Washington –December 2007 = 100 WA leisurenednhealth servicesindex.EMF (WACES) WAALEIH / WAAEDUH 9908- 11007 Health services employment remained relatively strong throughout the recession

32. 32 Washington statewide hiring dropped substantially, but did not disappear during the recession

33. 33 Washington labor markets are dynamic -- hiring happens even in the depths of recession

34. 34 Washington Local Employment Dynamics: employment and new hires, by sector Source: Local Employment Dynamics Partnership, US Census Bureau and LMEA, ESD

35. 35 Greg Weeks, Email: gweeks@esd.wa.govgweeks@esd.wa.gov (360) 438-4804 www.workforceexplorer.com Thank you for your time and attention. Please direct any additional questions, comments, or suggestions to me at the email or telephone number below