Source: Department of Occupational Safety/DATA;
Local unemployment statistics
County unemployment rates, not seasonally adjusted. Washington State, January 2020 to July 2022.
unemployment rate down; workforce is shrinking
A recent report on Okanogan County’s economy offers good news, with historically low unemployment rates, but not-so-encouraging data showing the county’s labor force shrinking.
“On the bright side, Okanogan County’s July unemployment rate of 4.3% is the lowest rate for the month of July since county data began being collected electronically in 1990,” said Donald Meseck, regional labor economist at State Employment Security Department.
Okanogan County followed a statewide trend, with Washington’s unemployment rate falling to 3.6% in July. That’s the lowest rate for July since nationwide data began being collected electronically in 1976. The economic report released this month includes employment data through July.
While the downward trend in unemployment is welcome, Meseck said he saw a “worrying” trend in the contraction of Okanogan County’s civilian labor force in July. Compared to July 2021, the labor force shrank by 660 inhabitants, a decrease of 3.2%.
“The labor pool is smaller this July than in July 2021,” said Meseck. “Normally you want a high participation rate. With population growth, you get labor force growth. It indicates a healthy economy, people are taking up jobs and participating in the economy.”
The county’s workforce (defined as residents over 16 who are employed or unemployed) has been growing since May 2021 before contracting in July of this year, Meseck said. “Economic news is found in the fact that the Okanogan County workforce still hasn’t recovered from the pre-COVID era three years ago,” he said.
In July 2019, before the COVID-19 shutdown hit the economy, the State Occupational Safety and Health Administration estimated that 23,401 Okanogan County residents were employed. That year, the number of residents of the county among the local labor force was estimated at 20,137, or 3,264 fewer workers.
“The labor force has shrunk. This is bad news. But the number of unemployed fell. Just looking at the unemployment rate might give us a false sense of security because it’s historical,” Meseck said.
“The labor force is smaller. People in the labor force, most people who want to work can find a job. There are more job openings than people to fill them. Many employers have difficulty filling vacancies. It’s a kind of labor market for job seekers,” said Meseck.
State labor force data doesn’t collect survey information about why individuals aren’t working, Meseck said, so it’s not clear why more county workers aren’t participating in the economy.
Acceptance declared
But Meseck said he has a theory that might explain some of the decline in the workforce.
The shrinking labor force statistics can be seen in all counties in the region, including Douglas, Chelan, Grant and Yakima counties, Meseck noted. These counties saw a trend toward lower workforce numbers that began in late spring. Because central Washington counties have “a sizable portion of the workforce in agriculture,” this year’s smaller cherry harvest could account for some of the decline in the workforce, he said.
Cold weather and a late snowfall resulted in the smallest cherry harvest in the Pacific Northwest in 14 years. Because fewer people are needed to harvest and process the crop, it means fewer people seek or find jobs related to cherry production, Meseck said.
Labor force participation is declining nationwide, Meseck added. For some people in the post-COVID era, this could reflect a “reassessment of lifestyle, perhaps making decisions to stay at home and raise children”.
Data from the state’s latest report shows that nonfarm payrolls in Okanogan County fell in June and July after rising in the previous 14 months.
“Between July 2021 and July 2022, total nonfarm payrolls in Okanogan County lost 330 jobs. It is also concerning that non-farm employment in June and July fell below the corresponding pre-COVID months in June and July 2019,” Meseck said.
industry suffers
The leisure and hospitality sector of the local economy was the hardest hit by job losses among different employment sectors, with 380 fewer leisure and hospitality service workers this July compared to July a year ago. That’s 25.5% fewer jobs in the leisure and hospitality industry (hotels, restaurants and bars, amusement and recreation), which is one of the top employers and income generators in the Methow Valley.
After layoffs and closures during the pandemic, recruitment in the leisure and hospitality sector was strong in 2021, with job opportunities increasing until April this year when the sector began to shrink. Figures for this July show that the number of jobs in the leisure and hospitality sector was 1,110 jobs, down 30.6% from the number of jobs in this sector in July 2019 before COVID.
The construction industry in Okanogan County also declined from May to July this year, with an estimated 680 local construction industry jobs in July 2021 compared to 590 in July 2022, down 13.2%. This contrasts with a nationwide trend showing 16 months of growth in construction employment from April 2021 to July this year.
Meseck said state economists will be monitoring Okanogan County’s August employment numbers “to see if these relatively weak nonfarm payrolls numbers in June and July of 2022 are ‘bright spots on the radar screen’ or indicators of a slowing local job market.”
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