Economic Overview of S.C. Labor Markets, May 2007
Contact: Don Schunk, Research Economist, firstname.lastname@example.org, (843) 349-2485 or (843) 333-8548
May 2007 data on employment and unemployment for South Carolina were released June 19 by the South Carolina Employment Security Commission and the U.S. Bureau of Labor Statistics. According to CCU research economist Don Schunk, the data suggest that South Carolina's economy continues to experience solid growth.
Among the major trends currently underway across the state:
* South Carolina's unemployment rate has fallen for six consecutive months. The jobless rate has dropped from a high of 6.6 percent in November 2006 to stand at 5.4 percent as of May 2007 - the lowest jobless rate in the state since the summer of 2001. Over this same period, the national jobless rate has held steady at 4.5 percent. Unemployment has been falling even though the pace of new job creation has actually slowed slightly. This has occurred because the rate of growth in the state's labor force has finally slowed to a more sustainable pace. The state's labor markets had been flooded in the last three years by both new entrants and re-entrants into the labor force. Because labor force growth was exceeding job growth, the state's jobless rate remained elevated. As we have been approaching a natural upper-limit to the labor force participation rate, labor force growth has slowed to a pace such that the economy has been able to absorb these new workers.
* Over the last 12 months, total employment in South Carolina has grown by 1.2 percent for a gain of 23,400 jobs. Job growth has been fairly widespread, though manufacturing continues to decline, losing about 10,200 jobs in the last year. Rather than looking just at total employment, it is often useful to consider job growth in the private, service-providing sectors of the economy. These are all jobs excluding those in construction, manufacturing and the government sector. Private, service-providing employment in South Carolina grew by 2.7 percent between May 2006 and May 2007. Nationwide, private service-providing employment grew by 1.9 percent over the same period. This is not to say that the ongoing job losses in manufacturing should be ignored. Clearly, the long-term decline in manufacturing as a source of employment continues to be an important structural issue affecting our state. Also, government is an important source of employment in the state, but trends in government jobs are largely affected by policy as opposed to being indicative of economic conditions. Therefore, it is important to recognize that the private, service-providing sectors of the economy - which currently account for about 64 percent of all jobs in the state - continue to generate new jobs for South Carolina.
* Regional job growth continues to vary widely in South Carolina. As is often the case, the Myrtle Beach and Charleston metro areas are posting the fastest rates of job growth (3.4 percent and 2.3 percent respectively since May 2006). The Columbia (1.2 percent), Florence (1.7 percent) and Greenville (1.6 percent) metro areas are currently growing at or slightly ahead of the statewide average. Meanwhile, the Spartanburg (-0.7 percent), Anderson (-0.6 percent) and Sumter (-0.3) areas are all posting year-over-year job losses as these areas struggle with the losses in manufacturing.
* On the whole, South Carolina continues to post labor market gains. Most notably, we are finally seeing steady improvements in the jobless rate. The labor market patterns over the last few years affirm once again the fact that unemployment rates are lagging indicators of overall economic performance, and that jobless rates - as any other indicator - cannot be viewed in isolation. Statewide, South Carolina appears to be on track for total job growth of about 1.3 percent for all of 2007. The jobless rate has actually fallen a bit faster than previously expected, and appears to be on track to average about 5.6 percent for all of 2007.