The Prescott labor market has cooled amid a shrinking workforce, according to an analysis by the Economic and Business Research Center, the premiere source for information on Arizona’s economy since 1949.
In August, the seasonally adjusted civilian labor force in the Prescott MSA stood at 106,966, remaining essentially flat over the month. After declining from 107,062 in April to 106,855 in May, the labor force has been gradually recovering. Despite recent monthly gains, the civilian labor force year-to-date remains 3.0% smaller than the prior year.
In the Prescott MSA, seasonally adjusted resident employment edged down to 102,648 in August, down 49 from July. Employment has trended lower throughout 2024, falling from 106,673 in December 2024 to approximately 103,000 in recent months. Year to date, resident employment in the first eight months is 3.6% lower than in the same period last year.
Seasonally adjusted unemployment in the Prescott MSA rose by 55 (1.2%) over the month to 4,318 in August. Nearly every month this year has shown increases in seasonally adjusted unemployment, rising from 3,851 in January to the current year-to-date high. Year to date, resident unemployment has increased by 13.6% compared to the same period last year. At the state level, unemployment has shown a similar trend, rising from 146,714 in January to 157,143 in August, a 7.1% increase.
The seasonally adjusted unemployment rate for the Prescott MSA held steady at 4.0% in August. The rate has climbed gradually throughout 2024, rising from 3.6% in January to 4.0% today. Arizona’s statewide unemployment rate followed a similar trajectory, starting at 3.9% in January and February before rising to 4.1%, where it remained from March through August.
ECONOMIC NEWS: How TSMC Arizona changes the state’s economic landscape
LEARN MORE: AZ Big Podcast: Rose Castanares of TSMC talks building a massive workforce
Non-seasonally adjusted hourly earnings in the Prescott MSA posted gains of 4.5% in August, rising by $1.20 year over year to $27.67. June and July observed similar wage growth, with hourly earnings up 4.6% to $26.88 and 2.4% to $25.81, respectively. August’s rate of $27.67 is roughly equivalent to an annual salary of $57,553 for a full-time worker.
Seasonally adjusted total nonfarm employment in the Prescott MSA reached 71,600 in August, up 200 (0.3%) from July. Employment has been relatively flat in recent months, edging down from 72,000 in April to 71,400 in July before the modest August gain. Arizona’s statewide employment showed similar volatility, declining by 15,200 in June before posting gains of 2,700 in July and 700 in August.
Non-seasonally adjusted total nonfarm employment in the Prescott MSA fell 0.4% year-over-year to 71,300 in August. Most months in 2024 have shown year-over-year declines, with July being the lone exception, posting a 0.9% gain to 70,100.
Among industries in the Prescott MSA, Other Services posted the strongest year-over-year growth in August, increasing by 3.8% to 2,700. Private Education and Health Services (+2.3%), State and Local Government (+2.1%), and Professional and Business Services (+1.4%) also saw solid growth.
On the other hand, Manufacturing experienced the largest year-over-year decline, falling 5.6% to 3,400 jobs in August, followed by Trade, Transportation, and Utilities (-3.7%). Other notable decreases included Leisure and Hospitality (-2.0%) and Mining, Logging, and Construction (-1.4%). Employment levels in Information, Financial Activities, and Federal Government were unchanged over the year.
Non-seasonally adjusted retail sales excluding food and gasoline in the Prescott MSA rose by 3.4% year-over-year in August to $258.6 million. June and July showed similar growth of 1.5% and 2.2%, rising to $272.3 million and $255.7 million, respectively.
Non-seasonally adjusted housing permits in the Prescott MSA have fluctuated sharply in recent months. Total permits surged 147.4% year-over-year in June to 287, with single-family permits rising 25.9% to 141. In July, permit activity reversed course, with total permits down 44.8% to 153 and single-family permits down 25.6% to 125. The downward trend continued in August, with total permits dropping 20.3% to 118 and single-family permits falling 3.3% to 118.
