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FOR IMMEDIATE RELEASE: January 26, 2020
Contact: Glenn Mills 207-621-5192
AUGUSTA – Job gains in a number of sectors were mostly offset by decreases in the leisure and hospitality sector and the early end of in-person instruction on University of Maine campuses for the fall semester. In December:
- The number of nonfarm payroll jobs and unemployed were little changed
- There were 7.6 percent fewer jobs than in February
- Labor force participation continued to decrease, causing unemployment estimates to understate the level of job displacement that has occurred
Seasonally Adjusted Statewide Data
Payroll Survey Estimates
The fall COVID surge has slowed the jobs recovery. The 588,900 nonfarm payroll jobs in December was little changed, up 400. The number of jobs was essentially unchanged in the final three months of 2020. The trend in Maine closely parallels what has occurred nationally.
A net gain of 3,600 jobs in construction, manufacturing, transportation and warehousing, professional and business services, educational services, healthcare and social assistance, and other sectors was mostly offset by a sharp decrease in the leisure and hospitality sector and by the early end of in-person instruction on University of Maine campuses. Jobs in hospitality and public higher education decreased 1,800 and 1,200 respectively in December.
Across all sectors there were 7.6 percent fewer jobs than in February. The number of jobs remained down 29 percent in leisure and hospitality, 14 percent in information, 13 percent in private educational services, 11 percent in state government, and ten percent in local governments. Nearly all of the decrease in state and local governments was in education, both K-12 and higher ed. Just over 60 percent of the net decrease in jobs was in education and hospitality.
Household Survey Estimates
The 4.9 percent unemployment rate and 33,200 unemployed both were essentially unchanged from revised November estimates. The labor force participation rate decreased 0.2 points to 60.2 percent.
Health concerns, childcare challenges, and other factors continued to prevent many jobless people from being available to work or from engaging in work search, as they normally would if not for the virus. Jobless people who do not search for work are not considered to be in the labor force and are not counted as unemployed. If labor force participation was as high as it was in February, nearly 25,000 more people would have been in the labor force. Additionally, the U.S. Bureau of Labor Statistics estimates that close to 15,600 people were misclassified by survey interviewers as employed rather than as temporarily unemployed, as they should have been. If not for these two issues, the unemployment rate for December would have been slightly over ten percent.
U.S. and Regional Household Survey Estimates
The U.S. unemployment rate remained at 6.7 percent; the New England rate increased 0.4 percentage points to 6.9 percent. December rates for other states in the region were 4.0 percent in New Hampshire, 3.1 percent in Vermont, 7.4 percent in Massachusetts, 8.1 percent in Rhode Island, and 8.0 percent in Connecticut.
Not Seasonally Adjusted Substate Data
The not seasonally adjusted statewide unemployment rate of 4.7 percent for December was up from 2.9 percent one year ago. Unemployment rates were lowest in Sagadahoc County (3.8 percent) and highest in Somerset County (6.3 percent).
Among the three metro areas, unemployment rates were below the statewide average in Bangor and Portland-South Portland (both 4.3 percent) and at the average in Lewiston-Auburn (4.7 percent).
Due to annual data revisions, release of January 2020 estimates will be delayed until Monday, March 15 at 10 a.m. Revised statewide data for prior years, including 2020 annual averages, will be published Wednesday, March 3. (Data Release Schedule).
Labor force and unemployment data is available here.
Nonfarm payroll jobs data is available here.
Monthly workforce estimates are cooperatively produced and released by the Maine Department of Labor, Center for Workforce Research and the U.S. Department of Labor, Bureau of Labor Statistics.
1. Preliminary seasonally-adjusted labor force estimates, including rates (labor force participation, employment, and unemployment rates), and levels (labor force, employed, and unemployed) tend to move in a direction for several months and then reverse course. Those directional trends are largely driven by a smoothing procedure and may not indicate a change in underlying workforce conditions. Annual revisions (published in March each year) tend to moderate or eliminate those directional patterns. A comparison of 2019 preliminary and revised estimates of labor force and unemployment rates, as well as nonfarm payroll jobs, is available at http://www.maine.gov/labor/cwri/blogs/2019_workforce_data_revisions.pdf.
2. The 90 percent confidence interval for statewide unemployment rates for December is 0.7 percentage points above or below the published estimate.
3. To assess job growth, we recommend looking at nonfarm jobs from the payroll survey rather than resident employment from the household survey. The payroll survey is larger, has smaller margins of error, and is subject to smaller revisions. A 2016 blog on the differences in accuracy of the two measures provides more context at www.maine.gov/labor/cwri/blogs/imprecise_data.pdf .
4. Nonfarm payroll jobs estimates tend to be volatile from month to month because there is variability in the sample of reporting employers and their representativeness for the universe of all employers. Additionally, seasonal adjustment is imperfect because weather, the beginning and ending of school semesters, holidays, and other events do not always occur with the same timing relative to the pay period that includes the 12th day of the month, which is the reference period. This sometimes exacerbates monthly volatility. Users should look to the trend over multiple months rather than the change from one specific month to another. Estimates for the period from October 2019 to September 2020 will be replaced with actual payroll data in March 2021. Those benchmark revisions are likely to show less volatility than preliminary estimates do.