Arizona added 9,200 jobs over the month in December on a seasonally adjusted basis. Job gains in November were revised up from 11,500 to 12,900. The state unemployment rate was stable in December at 4.3%, slightly above the national rate of 3.7%.

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Job growth in December was widespread, with financial activities (up 2,000), private education and health services (up 1,900), professional and business services (up 1,500), government (up 1,000), leisure and hospitality (up 800), other services (up 800), trade, transportation and utilities (up 800), construction (up 600), and natural resources and mining (up 100). Manufacturing jobs were down 100 and information jobs dropped by 200.

Over the year, Arizona jobs were up 64,800 (non-seasonally adjusted) in December, which translated into 2.0% growth. That was modestly above the nation at 1.9%. As Exhibit 1 shows, government jobs were up 21,800 over the year, followed by private education and health services (up 21,300). Government job gains were driven by state and local education. Manufacturing jobs were down 2,600 over the year in December, reflecting in part the normalization of consumer spending across goods and services. Information jobs were down 2,900.

Exhibit 1: Arizona Net Job Change (Thous.) and 2022 Annual Wages per Worker

Phoenix MSA jobs were up 42,500 over the year in December for 1.8% growth. Gains were driven by private education and health services, construction, and government. Information, other services, and manufacturing lost jobs.

Tucson MSA jobs increased by 0.8% over the year in December rising by 3,400. Government jobs drove the increase, rising by 5,000. Leisure and hospitality, professional and business services, and trade, transportation, and utilities jobs declined.

Prescott MSA jobs were up 500 over the year in December for 0.7% growth. Government, private education and health services, and mining and construction drove gains. Jobs in trade, transportation, and utilities, leisure and hospitality, manufacturing, and professional and business services dropped.

With the release of the December data, we now have preliminary full-year results for 2023 (Exhibit 2). On average in 2023, Arizona jobs rose by 64,700 over 2022, which translated into 2.1% growth. That was slightly below the national growth rate of 2.3%.

Phoenix MSA jobs rose 49,900 in 2023, up 2.2% from 2022, and Tucson MSA jobs rose 5,400, up 1.4% from 2022. Prescott MSA jobs rose 1,100 over the year for 1.6% growth.

Keep in mind that these data are preliminary and will be revised in March. For Tucson, these revisions can be substantial.

Author: George W. Hammond, Ph.D., is the director and research professor at the Economic and Business Research Center (EBRC).