January State Employment Report

On March 13 BLS released January labor market estimates by state. These figures include the regular benchmark revisions to the QCEW of the payroll numbers, which had been incorporated into the national figures in the February 2 release. In late February BLS issued revised household data, reflecting the introduction of new Census Bureau information. New seasonal adjustment factors were also rolled out with these releases.

BLS introduced some changes into the payroll data with this release. First, as was the case in the national report, industry figures are now reported on a 2017 NAICS basis, updated from the prior 2012 NAICS basis. Second, BLS is now applying the same concurrent seasonal adjustment methodology to state payroll data that it has been using for several years on the national data. As is the case in the national numbers, the updated seasonal factors will, prior to annual revisions, only be applied to the newly reported and prior two months.

BLS does not force the sum of state payroll employment to equal the national total (in the household survey the sum of the state values for the labor force and employment does equal the national totals for not seasonally adjusted series). Thus, there is a sense in which the "sum of the states" figure is a separate estimate of the national payroll situation. With both the national and state data now benchmarked to the QCEW, it is a good time to check on how they compare.

The answer is that the state sums have shown a bit less robust growth than the national aggregate. Over the course of 2017 (December 2016 to December 2017), the national release shows that nonfarm payroll employment rose 2.188 million; the sum of the states' figure was up 2.073 million. While that gap looks fairly modest, it was considerably larger in 2016: the national total was up 2.344 million, more than 300 thousand greater than the 2.035 million reported by the sum of the states. The levels of the two aggregates, though, are quite close (in January, the sum of the states total was 147.750 million vs. the national figure of 147.864 million). Comparable comments can be made about the not-seasonally adjusted data.

Turning to the January figures, the state numbers generally showed less rich gains than the national estimate: the sum of states figure was up 170.5 thousand against the national increase of 239 thousand (as these things go, this was not such a marked discrepancy: last September's weak national increase of 14 thousand was dwarfed by the 106 thousand loss for the sum of the states, while in October the strong national increase of 271 thousand was small in comparison to the outsized 475 thousand gain for the sum of the states). Only 3 states-California, Maryland, and New Jersey-reported job gains that BLS saw as statistically significant (North Dakota had a statistically significant loss of jobs).

The household survey numbers suggest that regional differences in the tightness of job markets may be, despite much discussion, fairly limited at this point in the cycle. The state with the highest unemployment rate in January was Alaska (7.3%), compared to the low state, Hawaii (a remarkable 2.1%)-a 5.2 percentage point gap. In the lower 48 states the range was a much narrower 3.3 percentage points : going from New Mexico's 5.9% to 2.6% in both New Hampshire and North Dakota.