Maine continues to lag behind in job creation

The latest State & Local Area Unemployment Statistics are in from the Bureau of Labor Statistics (BLS), and the difference between the Maine and national economies couldn’t be clearer.  While the White House announced its 73rd month of straight job growth, Maine still hasn’t recovered all the jobs lost during the recession.

Since 2010, the number of people employed in the private sector in the US has risen by 14.4 million (6% of the adult civilian population), the job growth in Maine in Maine over the period is 14,650 (1.4%).  As anemic as Maine’s job growth looks, the situation is even worse when comparisons are pushed further back.

The US recovered the 8.7 million jobs lost since December 2007 by early 2010, but Maine still has 16,000 fewer people working today than it did in December 2007.  In December 2006, Maine actually had 21,000 more people employed than we do today.

Employment 4-15-2016 slide 1

National Monthly Job Growth,

Employment 4-15-2016 slide 2

Maine’s job growth has not only been more sluggish than the nation as a whole, but it’s been uneven.  During 2014 and 2015, hundreds of people left the Maine employment rolls every month, even as national the jobs situation improved robustly.

But isn’t Maine’s unemployment rate at a record low?  Technically, yes.  But it’s important to know how the technocrats calculate unemployment.  They narrowly define unemployed individuals as those who looked for work over the past four weeks.  They do not consider people who are discouraged or looking intermittently “unemployed” in the official count.  Instead, they classify them as “not in the labor force.” An examination of Maine’s civilian population over the 2008-16 period shows that while the unemployment rate is lower, total employment is also down.  The number of people not counted in the labor force has increased over this period.  Some of those are retirees, but many are not.   Working-aged men (aged 18-65) are one of the fastest growing components of the population not in the labor force.

Employment 4-15-2016 slide 3

Three factors are major contributors to the difference in the national and state outlooks:

Maine lawmakers have the tools to reverse these trends.  The bipartisan 2015 budget agreement, passed over Gov. LePage’s veto, made a good start at restoring the progressivity of Maine’s tax code, but revenue is still well below where it needs to be to adequately fund services like schools. This week the legislature voted for a sixth time to accept Medicaid funding in the final weeks of the 2016 session, but face a sixth LePage veto.  Most policymakers recognize Maine’s demographic challenges, and the need to welcome new Mainers from other states and overseas is gathering acceptance.  The crucial next steps are to boost these efforts with growth-oriented policies.