Alabama’s economic indicators, like the nation’s, are definitely getting better – based on several numbers out over the last week.
Here’s a rundown:
Unemployment in September
Alabama’s unemployment number is 4.1 percent. A record number of Alabamians are working – 2.048 million, with 47,000 hired since January, outpacing economic predictions for the year by more than 20,000.
Nationally, the U.S. Labor Department reported 250,000 new jobs in September, which was also ahead of expectation. National unemployment remains at 3.7 percent.
Significant locally, the Bureau of Labor Statistics said that Hurricane Michael, which made landfall last month, had “no discernible effect” on hiring and the unemployment rate.
Alabama has been seeing earnings growth. According to the Alabama Department of Labor, average weekly earnings increased over the year by $53.82. Manufacturing weekly earnings increased by $27.18 over the year, and construction weekly earnings were up $55.08 over the year.
That lines up with national numbers. The 12-month rate of U.S. hourly wage gains rose to 3.1 percent from 2.8 percent in September and hit a high not seen since 2009.
Rising wages are a good sign for several reasons, as economists had been puzzled for some months as to why wages were not rising as employment numbers shot up. It’s also good news for workers, as wage growth had lagged behind cost of living increases.
The Bureau of Economic Analysis at the U.S. Department of Commerce announced last month that the U.S. economy grew at a 3.5 percent annual rate.
Alabama’s state GDP numbers will come out later this month. Previously, it was up 1.2 percent from the fourth quarter of 2017 to the first quarter of 2018, according to the Bureau of Economic Analysis.
Why are current numbers ahead of projections? Probably because of the length of the economic recovery. Consider that the current period began after the worst of the Great Recession had passed in June 2009, which would mean that, if it makes it to next summer, the current recovery will be the longest in U.S. history since the end of World War II. Obviously, that’s a good run.
Ahmad Ijaz, executive director at the University of Alabama’s Center for Business & Economic Research, said economic forecasts usually factor in the duration of previous expansions. Around the five-year mark, they start to expect an end point approaching.
“That’s the average duration of recoveries,” he said. “We are way past that point.”
Why has this one had such staying power? Perhaps because its beginnings were so slow. “Employment gains were very weak in the beginning,” he said.