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July 2, 2014 – Indicators of metro area economic growth held steady in May, according to a monthly report by the Metropolitan Milwaukee Association of Commerce (MMAC). Sixteen of 23 metro area indicators pointed upward in May matching the 16 positives posted in April.
“Metro area economic indicators have strengthened in recent months after posting a generally weak first quarter,” said Bret Mayborne, economic research director for the MMAC. “Job gains in the past two months have been particularly strong. Gains in the April and May period mark the strongest back-to-back increases registered in the post-recession period.”
“Job gains in the past two months have been particularly strong. Gains in the April and May period mark the strongest back-to-back increases registered in the post-recession period.”
of Economic Research
Highlights of the report include:
• Nonfarm employment averaged 839,500 in May, a 1.5% rise over year-ago levels. This increase translates into the addition of 12,700 jobs over the May, 2013 to May, 2014 period. May’s gain follows the revised 1.6% year-over-year increase recorded in April.
• Eight of ten major industry sectors registered May job gains (vs. one year ago), while two posted declines. The construction, mining & natural resources sector (up 5.9% over year-ago levels) posted the largest percentage increase. Conversely, a 2.6% job decline in the financial activities sector was the largest decrease registered.
• Local housing and real estate indicators continued to point downward. Existing home sales in the metro area posted its fourth consecutive year-over-year decline and mortgages recorded in Milwaukee County fell for the tenth consecutive month.
Unemployment indicators for the metro area remain positive. The number of unemployed fell 13.9% (vs. one year ago) in May, falling for the seventh consecutive month on a year-over-year basis. New unemployment compensation claims fell even faster, down 22% (vs. year ago levels), to 4,280.
May’s seasonally unadjusted jobless rate of 6.1% ranks one full percentage point lower than the 7.1% rate posted one year ago. Currently, the metro area's unemployment rate is higher than the state's 5.5% rate and matches the nation's 6.1% figure.
Indicators: May, 2014 vs. May, 2013
Nonfarm job levels in the metro Milwaukee area reached 839,500 in May, the 44th consecutive month of year-over-year increase and the highest aggregate employment total reached since December, 2008. May’s 1.5% gain nearly matches the revised 1.6% increase posted in April and mark the strongest back-to-back months of gain in the post-recession period.
May job gains were broad-based with eight of ten major industry sectors posting year-over-year employment increases. Jobs in the construction, mining & natural resources sector grew at a 5.9% pace (to 27,100), this month’s strongest year-over-year gain. The education & health services (up 3.6%), government (up 3.3%), leisure & hospitality (up 2.3%), professional & business services (up 1.2%), other services (up 1.2%), trade, transportation & utilities (up 0.6%), and manufacturing (up 0.1%) sectors also reported May gains.
Among the two major industries with job declines, the financial activities sector, down 2.6% (to 52,700), posted the largest year-over-year decrease. A 2% employment decline was posted in the information sector.
Manufacturing’s small May job increase (up 0.1%) was this indicator’s first rise in 12 months. Results in hours and earnings indicators for manufacturing production workers were mixed. The average workweek length for manufacturing production workers fell for the tenth time in the past eleven months, down 4.2%, to 40.6 hours. The average weekly earnings for such workers fell 0.9% (to $754), while average hourly earnings rose 3.5%, to $18.56.
Housing and real estate indicators tracked by the MMAC continued downward in May. Existing home sales in the metro area fell 10.5%, to 1,340, its fourth consecutive year-over-year decline. Mortgages recorded in Milwaukee County dropped 28.5%, to 1,996, following the 33.3% decline posted in April (vs. April, 2013).
Air passenger totals at Mitchell International Airport rose for the fourth consecutive month. Passengers numbered 573,248 for May, a 1.8% increase from one year ago. New-car registrations in the metro area fell for the first time in four months. Registrations totaled 3,210 for the month, down 5.3% from one year ago.
Other Indicators (latest available)
The value of signed construction contracts, as reported by F.W. Dodge for April, was $65.7 million, up 29.2% from April, 2013. Consumer prices nationally, as measured by the Consumer Price Index for Urban Consumers (CPI-U), rose 2.1% in May (vs. May, 2013) to 237.900 (1982-84 = 100). The Milwaukee area CPI-U reached 224.705 for the second half of 2013, a 1.2% increase from 2012's second half.