F l o r id a Summ a r y
Federal Government employment growth. Job losses are expected through the end of 2015 and beyond as the U.S. begins to come to grips with massive budget deficits and a ballooning national debt. Federal Government employment in Florida will contract at an average rate of 2.2% during 2012-2015.
U ne mp loy m e n t Unemployment rates in Florida remain elevated, but like the national rate they have come down substantially from their peaks. Part of the problem is that these declines have been largely driven by the shrinking of the labor force, and thus are somewhat misleading when taken out of this context in trying to assess the health of the labor market in Florida. Real Gross State Product has been growing continuously since the 1st quarter of 2010, but only at an average growth rate of 1.0% through 2012. Robust growth is needed to bring down the unemployment rate quickly, and labor force shrinkage notwithstanding, we have not seen the type of growth that can do more than lower the unemployment rate gradually. As of September, the unemployment rate in Florida stood at 8.7% for a 1.7% decline over the span of less than three years.
reducing the unemployment rate a more challenging and protracted process. When discouraged workers re-enter the job hunt there will be upward pressure on the unemployment rate. Although it seems counterintuitive, if the unemployment rate is rising because of this reentry it will actually be a good sign and an indication that the labor market is healing. The unemployment rate is expected to continue a slow, drawn-out decline that will push it down to 7.4% by the end of 2015. This problem of underemployment and marginally attached workers – those who are neither working nor looking for work, but indicate that they want and are available for a job, and have looked for work sometime in the past twelve months and those who have given up searching for a job entirely – is substantial. When adding these workers to the top-level unemployment figure, this broader measure of unemployment, known as U-6, paints an even grimmer picture of labor markets, and is currently at 17.0% for the third quarter of 2011 through second quarter of 2012 in Florida, according to the Bureau of Labor Statistics. This paints a much grimmer picture of the state of the labor market in Florida than does the headline unemployment rate of 8.7%.
The tepid growth Florida has experienced thus far in the recovery will only chip away at the unemployment rate; robust growth is necessary to ratchet the unemployment rate down. This type of growth Florida will not see for at least another year and a half. The labor market cycle generally lags the business cycle overall, but the weak and erratic nature of this recovery and the uncertainty that seems to permeate the economy from the healthcare reform, to the fiscal cliff, to the European debt crisis, has lengthened this jobless recovery well beyond what could be considered a normal lag. As payroll job growth finally gains momentum, it will trigger the reentry of discouraged workers who had abandoned the job search during this long labor market cycle. This source of growth in the labor force, which has not yet fully manifested itself, will make Institute for Economic Competitiveness
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