- State-level data on employment in September shows that Florida’s jobs market suffered the most from recent hurricanes.
- The jobs report last month showed that net nonfarm payrolls were negative for the first time in seven years.
- The October jobs report may also be weak, as hiring may not have gained enough momentum by last week, when the monthly survey was conducted.
The September jobs report showed a stunning drop in net nonfarm payrolls by 33,000, the first time the US economy shed jobs since 2010.
State-level data released on Friday made clear that most of the job losses occurred in Florida.
“Payrolls declined 127,000 in Florida in September, a result significantly weaker than the prior trend (+17,000 per month over the prior six months),” said Daniel Silver, an economist at JPMorgan, in a note on Friday. “It is likely that payrolls in the state will rebound in October, although it is not clear if all of the job losses will be made up by the time of the October reference period.”
Ahead of the payrolls release earlier in October, economists had a wide range of expectations for how the hurricanes impacted the labour market. That gap in forecasts — from as many as 260,000 net new jobs to as low as -45,000 — showed how uncertain the economic impact was. But additional data is making it clearer.
“There was also noticeable, but less dramatic, weakening in the data for some other areas affected by recent storms, including Texas,” Silver said.
The trend in jobs growth slowed down even in areas that were not affected by hurricanes. One explanation economists offer is that the economy is approaching a level associated with full employment, with the official unemployment rate at its lowest level since September 2001. However, the number of working-age people who aren’t looking for jobs has not fully recovered to its pre-recession level.