For further information contact Economic Research Director BRET MAYBORNE at (414) 287.4122
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October 30, 2014 – Business activity indictors in metro Milwaukee posted broad-based gains in September, according to a monthly report by the Metropolitan Milwaukee Association of Commerce (MMAC). Nineteen of 23 indicators registered improvement in September over year-ago levels, up from August’s 16 positives.
"The aggregate total of positive indicators in September (19) ranks as the highest number of improvements posted since October, 2006," said Bret Mayborne, economic research director for the MMAC. "September’s trend is marked by unanimous gains among manufacturing-related indicators for the first time since April, 2013, and suggests that local housing and real estate indicators may be on the mend."
"The aggregate total of positive indicators in September (19) ranks as the highest number of improvements posted since October, 2006."
of Economic Research
Highlights of the report include:
• Nonfarm employment in the metro area rose at a 2.2% pace in September (vs. September, 2013). September’s increase marks the fourth consecutive month of growth surpassing 2% and the 48th consecutive month of year-over-year growth overall.
• Job gains by industry were broad-based as eight of ten major industry sectors posted year-over-year growth. Only one sector – financial activities – registered a decline in this period, while one – information – was unchanged from year-ago levels.
• The trend in manufacturing jobs improved for the ninth consecutive month, growing 2% in September over year-ago levels. In addition, hours and earnings indicators for production workers all posted year-over-year gains for the first time since April, 2013.
Falling unemployment totals continue to push the local unemployment rate downward. The number of unemployed dropped 20.1% in September (vs. year-ago levels), the steepest monthly decline posted in the post-recession period. As a result metro Milwaukee’s seasonally unadjusted unemployment rate fell 1.4 percentage points from one year ago. September’s 5.4% rate ranks below the nation’s 5.7% rate but above the 4.7% rate posted statewide.
New unemployment compensation claims numbered 4,002 in September, down 16.4% vs. year-ago levels. September’s decline follows the 18.9% decrease recorded in August and marks the 12th consecutive month of year-over-year decline for this indicator.
Indicators: September, 2014 vs. September, 2013
Nonfarm employment in the metro area averaged 852,200 in September, a 2.2% increase over year-ago levels. Year-over-year gains have surpassed 2% in each of the past four months and exceed the 1.7% year-to-date average gain posted over the first nine months of 2014.
Eight of ten major industry sectors posted year-over-year job gains in September. The construction, mining & natural resources sector registered the strongest increase, up 7.7% from one-year ago. Employment gains were also recorded in the leisure & hospitality (up 5.4%), professional & business services (up 3.1%), education & health services (up 2.9%), manufacturing (up 2%), trade, transportation & utilities (up 1%), and government (up 0.3%) sectors. The other services sector rose 1.4% in September following modest declines in each of the two previous months (down 0.2% and 0.7% in August and July respectively).
Only one major industry sector registered a job decline in September vs. year-ago levels. The financial activities sector fell 1.7% (to 53,300), this sector’s 14th consecutive year-over-year decline. Employment in the information sector was unchanged from year-ago levels.
Hours and earnings indicators for manufacturing production workers pointed upward. The length of a production worker’s average workweek rose for the first time in 17 months, up 1.2% vs. one year-ago, to 42.3 hours. Average weekly earnings for such workers rose 4.3% (to $827), while average hourly earnings increased 3.1%, to $19.54. Gains in both earnings indicators surpassed national consumer price inflation over the same time period (up 1.7%).
The trend among local housing and real estate indicators may be moderating from earlier declines. Existing home sales in the metro area rose for the first time in eight months – up 5.2 vs. year-ago levels, to 1,278. Mortgages recorded in Milwaukee County fell for the 14th consecutive month (down 5.7%), but September’s percentage decline was the smallest recorded in this period.
New-car registrations rose 2.3% in September to 2,984. September’s gain follows consecutive months of year-over-year decline in August (down 11.2%) and July (down 1.9%). Air passenger totals at Mitchell International Airport fell 2.9% in September to 490,720. September’s decline is partly attributable to canceled or delayed flights resulting from Chicago’s air traffic control fire.
Other Indicators (latest available)
The value of signed construction contracts, as reported by F.W. Dodge for August, was $475.6 million, up 164.3% from August, 2013. Consumer prices nationally, as measured by the Consumer Price Index for Urban Consumers (CPI-U), rose 1.7% in September (vs. September, 2013) to 238.031 (1982-84 =100). The Milwaukee area CPI-U reached 228.005 for the first half of 2014, a 1.1% increase from 2013's first half.