Arizona posts huge job gains in July

Business News | 1 Sep |

Arizona added 22,900 jobs over the month in July, while the unemployment rate was steady at 3.3%.

Arizona added 22,900 jobs over the month in July, up from a revised 11,600 the prior month. The initial June estimate suggested the state added 15,000 jobs over the month. Growth in July was nearly quadruple the average monthly job gain during the five years before the pandemic began (6,300/month).

The state’s seasonally-adjusted unemployment rate was stable at 3.3%, just below the national rate of 3.5%.


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Over the month job gains were driven by trade, transportation, and utilities (+5,400), education and health services (+5,000), professional and business services (+4,300), leisure and hospitality (+3,300), government (+1,900), manufacturing (+1,800), and financial activities (+1,100). Jobs in natural resources and mining, construction, other services, and information were roughly stable over the month.

Arizona jobs are now 87,000 higher than their pre-pandemic level. As Exhibit 1 shows, that growth was driven by trade, transportation and utilities, financial activities, manufacturing, education and health services, construction, professional and business services, and information. Jobs in other services and natural resources and mining were roughly back to pre-pandemic levels, while leisure and hospitality and government remained well below their February 2020 level.

Exhibit 1: Arizona Jobs by Industry, Change from February 2020 to July 2022, Seasonally Adjusted, Thousands

While leisure and hospitality jobs remained below their February 2020 level for the state, the same is not true in Phoenix or Tucson. Leisure and hospitality jobs in Phoenix were 1,600 above their pre-pandemic level in July and jobs in Tucson were 1,000 jobs above their February 2020 level.

Even with strong gains in July, Arizona jobs remained well below their pre-pandemic trend (Exhibit 2). The gap in July was 117,200 jobs.

Exhibit 2: Arizona Jobs, Actual and Estimated Based on Trend, Seasonally Adjusted, Thousands

Job recovery rates remained uneven across Arizona’s metropolitan areas in July, as Exhibit 3 shows. There were three metropolitan areas that have yet to recover all of the jobs lost during the first two months of the pandemic. Through July, Sierra Vista-Douglas recovered 86.4% of the jobs lost during the February to April 2020 period, Flagstaff recovered 96.9%, and Tucson recovered 98.2%. In July, jobs in Tucson were just 800 below their pre-pandemic level. Tucson is on track to roughly follow the U.S. recovery timing (the U.S. reached 100% recovery in July, according to the preliminary data).

Exhibit 3: Arizona Job Recovery Rates by Metropolitan Area

 

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

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