Uptick in AZ Unemployment Rate Sign of Healthy Job Market
George Hammond explains why, and discusses risks to Arizona's outlook for 2020 and beyond.
Arizona's labor market is in good shape and growing faster than the nation. The Phoenix metro is driving state gains, as usual. The data for Tucson, however, tell a somewhat different story with solid gains and sustained but slower growth.
It's interesting that, even with strong growth, Arizona's unemployment rate has ticked up in recent months. We are not seeing increased layoffs because initial claims for unemployment insurance are trending down. So, rather than a warning sign, this uptick likely reflects a robust job market which is attracting migrants from other states and pulling in discouraged workers off the sidelines and into the labor force. Such an influx of workers tends to put upward pressure on the unemployment rate.
As for the short-term forecast, the nation is transitioning from above average growth in the past year to below trend growth in 2020 and 2021. This means slowing growth for Arizona, which implies recession risks are elevated. In this video, George Hammond discusses important factors that impact the outlook for Arizona and Tucson, and what indicators we should watch as we head into 2020.
Long-term growth will be driven by demographics and technology. Hammond also discusses the results of his recent research on the impact of automation and technological change on local jobs.