New Metro Employment Figures are Puzzling
February 3, 2011
At KCEconomy.com, we strive to find interesting facts and figures regarding our local economy and do our best to explain what these figures mean. It is only fair that we include facts and figures that we… well, simply cannot explain. Such is the case with the recent employment figures for metro areas.
According to the Bureau of Labor Statistics the Kansas City area saw nonfarm employment decline 1.9 percent between December 2009 and December 2010. Out of the large metro areas with populations greater than 750,000, only Sacramento, Calif., had a more severe decline (2.2 percent). For the Kansas City area this means a loss of nearly 16,000 jobs.
The BLS data is the industry standard. It is the source for local area unemployment rate data, but these Kansas City numbers on employment change just don’t seem right to us. In the 2011 economic forecast MARC prepares for the Greater Kansas City Chamber of Commerce, released back in October, we predicted modest employment growth of about 8,000 for the region in 2010. This prediction was made using a national employment forecast with our model of the regional economy to predict how the local economy will perform. In the past, this approach has proved to be fairly accurate. This is the first time our estimate of the region’s employment direction is opposite that of BLS.
Additionally, it has been generally accepted that our local economy weathered the recession better than other parts of the country. It is certainly surprising that Kansas City is so low relative to other large metros in terms of employment growth.
This BLS data will be revised this spring and we will look over the updated numbers with great interest. Either the current figures have somehow gotten out of alignment in 2010, or we may have to re-think how the local economy relates to the nation’s.
In the meantime, we will examine local employment data in detail so we can perhaps shed some light on this puzzling difference.