by Erik Randolph | Jun 24, 2021
Putting Georgia’s employment numbers in perspective
Is there any reason not to cheer? Georgia’s unemployment rate dropped to 4.1 percent in May.
Here are three reasons why this looks good for Georgia.
First, the unemployment rate is declining, giving optimism that the economy is bouncing back from the pandemic.
Second, there were only two periods in recorded history when Georgia’s unemployment rate was this low or lower. Starting from 1976—the extent of available data from the U.S. Bureau of Labor Statistics (BLS) on unemployment rates for the states—the first period was between October 1998 and July 2001 when the rate reached as low as 3.4 percent. This period occurred after the long economic expansion of the 1990s.
The other period—from April 2018 to the start of the pandemic—just occurred with Donald Trump in the White House. During this period, Georgia broke its best record by achieving 3.3 percent.
Third, Georgia’s rate is the 16th lowest in the country, beating out 34 other states. For comparison, the United States as a whole has a rate of 5.8 percent rate, considerably higher than Georgia’s.
But wait. Is the unemployment rate artificially low?
While optimism is merited, it is important to put the unemployment numbers in perspective.
Unemployment percentages do not capture those who do not participate in the labor force. According to the BLS, anyone not employed who had not actively looked for a job during the prior four weeks is not part of the labor force. Therefore, any person temporarily not looking for work is not accounted for when the BLS calculates the official unemployment rate. Especially now with all the repercussions of the pandemic, all those potential workers who have been sitting on the sidelines for the last four weeks are simply not counted.
The behavior of labor force participation is a loose link for unemployment numbers. Normally, when economic times are good, sidelined workers and even retirees come back into the labor force, which can push the unemployment rate up. When times are bad, the opposite happens. Workers drop out of the labor force, artificially lowering the unemployment rate.
During the depth of the pandemic, and as expected, the labor force participation rate in Georgia dropped—to 59.4 percent to be precise, compared to 62.9 percent just prior to the pandemic. In terms of real people, there were an estimated 260,575 fewer workers participating in the labor force—who were not counted among the unemployed, to emphasize the point. Participation bounced back some to 61.7 percent, but still there are 40,934 fewer workers in the labor force.
Other ways to measure it
BLS’s U-6 labor underutilization metric is another way to shed light on unemployment. It adds to the unemployed those discouraged and other “marginally attached” workers as well as part-time workers wanting full-time work but cannot find it.
Nationally, the U-6 rate hit a historic high of 22.9 percent in April 2020 representing 36.3 million people. It has since dropped to 10.2 percent representing 16.5 million people. However, in the months prior to the pandemic, the rate was at historic lows—in fact, as low as 6.8 percent. Obviously, while 10.2 percent is far better than 22.9 percent, it is significantly worse than 6.8 percent, representing a difference of 5.3 million workers.
Unfortunately, monthly U-6 data is not available for the states, making any comparison difficult. The BLS currently publishes only experimental U-6 state data averaged over a year’s time.
More useful for the states is the Nonfarm Employment estimates from BLS’s Current Employment Statistics survey. Only two states—Utah & Idaho—have caught up with employment from where they were in February 2020 before the pandemic hit. In contrast, the U.S as a whole is still 5% behind. Georgia ranks 16th among the states and is 4.0 % behind. Hawaii (-14.8%), New York (-9.6%), and Nevada (-8.6%) are the three states furthest behind.
If we use standard economic ARIMA Model time-series forecasting to estimate where employment would have been absent the pandemic, no state is back on track. The United States is 6.8% behind, and Georgia ranks near the middle in 27th place at −6.1%. Utah and Idaho lead the pack being the furthest ahead, while Hawaii, Nevada, New York, California, and Massachusetts trail the pack.
Observations on state differences and policies
In viewing the differences in employment among the states, the more rural states appear to be doing better. The states more dependent on tourism appear to be doing worse. State governments that implemented less severe lockdowns appear to be doing better. To test these observations, we will be running regression analyses to tease out any correlations. We will post the results when completed.
In the meantime, it is important for government to adopt policies that will help businesses to rebound and make it easier for startups. The goal should be not to just lower unemployment but also to bring those sidelined workers back into the labor force.
Erik Randolph is the Director of Research at the Georgia Center for Opportunity.
by Buzz Brockway | Jun 3, 2021
Get Buzz’d Heads to Austin for the Heritage Foundation’s Resource Bank Conference
Get Buzz’d in Austin, Texas at the Heritage Foundation Resource Bank Conference
by Eric Cochling | Jan 17, 2014
Below is the first edition of our Capitol Update newsletter for 2014. If you’d like to receive future editions in your inbox, sign up here.
2014 Session Begins
By: Eric Cochling, VP of Public Policy
Georgia Center for Opportunity
Welcome to the first edition of our Capitol Update for 2014. As we have done for several years, we will be sending out regular updates to let you know what’s happening under the gold dome (good, bad or otherwise) during the 2014 session of the Georgia General Assembly. Should you have any questions or comments about the content of these updates, please email Eric Cochling.
New Year, Election Near
The 152nd session of the Georgia General Assembly started on Monday. Since this is an election year, the session promises to be a short one as members of the Assembly look to campaign and raise money, things they cannot legally do while in session.
If this week has been any indication, activity will be fast and furious until the end of session, which is expected to end in mid-March this year. It doesn’t help the sense of urgency that the state is on the verge of moving our primary election from July to May. Legislation moving the primary election made its way through both houses of the General Assembly this week and is now on the way to the Governor for his signature.
With the elections looming and based on conversations we have had with lawmakers, we also expect the legislature to steer clear of politically divisive legislation. That said, “politically divisive” is in the eye of the beholder and you can never be certain what bills will generate controversy. It is safe to say that all legislators hope to leave this session, in particular, having made as few of their constituents mad as possible.
Legislation, Study Committees, and Rumors to Watch
– Education –
This week, Governor Deal proposed a $42.3 billion budget – more than half of which is coming from the federal government!! – that includes $547 million in additional funding for Georgia’s public school system to fund teacher pay increases and adding back days to the school calendar.
In other news, House Resolution 486, sponsored by Rep. Tom Taylor (R-Dunwoody) would amend the Georgia Constitution to allow municipalities created in 2005 or later (and contiguous municipalities) to form city school systems.
In the category of “Finally!,” Rep. Ed Setzler (R-Acworth) says that he is planning to introduce legislation to address some of the problems created by Georgia’s zero-tolerance law relative to weapons on school property. It would be great if accidentally leaving a pocket knife in your car didn’t result in a criminal record.
– Criminal Justice Reform –
Georgia’s Criminal Justice Reform Council released its third set of recommendations in three years on January 10th, this time focusing on reforming aspects of prisoner reentry. GCO testified before the council in November and we are happy to see that many of the recommendations from our Prisoner Reentry Working Group were included in the council’s report.
The council’s official recommendations include the following:
- Each prisoner should have a Transition Accountability Plan initiated at the time they enter prison and consistently used during incarceration that will determine the best path to successful reentry;
- State corrections agencies should work more closely with private agencies and returning citizens to locate and secure sustainable, safe, and affordable housing;
- The food stamp ban on offenders convicted of a drug-related felony should be lifted, provided that they maintain a certificate of program completion issued by the Department of Corrections showing that they are in good standing and in compliance;
- Judges should be allowed to modify driver’s license restrictions for those convicted of minor drug offenses not involving a vehicle so that they are able to operate a vehicle;
- In hiring for state employment, job candidates should not be asked about criminal history until the interview stage.
- Negligent hiring liability protection should be provided for companies willing to hire ex-offenders under certain conditions.
It is very likely that we will see these recommendations included in a criminal justice reform bill this session. We will keep you posted.
– Marriage and Family –
It’s difficult to deny the harm that no-fault divorce causes to children. It’s also difficult to know exactly what needs to be done to help protect kids from unecessary divorce. House Bill 684, sponsored by Rep. Jason Spencer (R-Woodbine), offers at least part of the answer.
This legislation would only affect couples with minor children, where the grounds for divorce are irreconcilable differences (no-fault). In those cases, the legislation would require divorcing parents to take an eight-hour course that explains how divorce will impact everyone involved, especially the children. It would also require a “discernment period” of 320 days before a court could grant the divorce. The waiting period could be waived in cases involving abuse, neglect, or abandonment and, importantly, the existence of abuse, neglect, or abandonment could be proven to a judge outside of the public eye and public record.
The thinking is that during the discernment period, tensions could cool and the couple could experience life apart – before making it permanent – so that they could see how their divorce would impact their children over the course of the year (including birthdays, holidays, etc.). While not a silver bullet to solve the marriage and divorce crisis in the country, this is certainly a good way to encourage couples with children to stay together.
Visit Allies for Family Life and look for “Children’s Hope for Family Act” for more information.
– Child Welfare –
According to this report, it appears that Georgia is moving quickly to obtain a federal waiver that would allow the state more flexibility in how it spends federal foster care dollars. Governor Deal has indicated that the new flexibility would be used to create new public/private partnerships that would allow private agencies to take a lead role in providing foster care and other child protection services. The Casey Family Foundation has praised the use of waivers and privatization in other states where it has been a success and called for extending the availability of waivers to the states beyond this year.
Our team continues to serve on the Governor’s Office of Children and Families CSEC Task Force, which is making real strides in raising awareness of child sex trafficking in Georgia and finding effective ways to rescue and serve victims, while reducing demand. The subgroup on which we serve recently developed a certification program for businesses that commit to fighting child sex trafficking called Champions for Safe Children. We are now in the process of delivering trainings for interested companies around the metro area. Next up: developing similar certification programs for cities and neighborhoods.
Please join us for our 4th annual School Choice Celebration & Rally on Tuesday, January 28th, from noon to 2pm at the Georgia State Capitol. Our special guest will be Keshia Knight Pulliam (Cosby Show and House of Payne). Registration is encouraged.
The General Assembly has been around a while and like any old institution it has developed its own language. James Salzer at the AJC put this glossary together to help us outsiders keep track of what’s happening.
Thanks to Jamie Lord, our director of government affairs, and Jacob Stubbs, our legislative intern and John Jay Fellowship alumnus for their able contributions to this update.
by Eric Cochling | Jan 15, 2014
Below is a guest blog by Dr. Eric Wearne of Georgia Gwinnett College and formerly with the Governor’s Office of Student Achievement. Dr. Wearne currently leads GCO’s College & Career Pathways working group.
By: Dr. Eric Wearne
What it means to be “college ready” has been a popular topic of conversation among educators in school systems, state agencies, and even at the national level for several years. Local schools certainly think about this, though they are not directly held accountable for their graduates’ outcomes (other than graduation itself). The Georgia Department of Education and the University System of Georgia have worked on college readiness definition and alignment issues for several years. SAT and ACT publish their opinions of what constitutes “college readiness” (based on their respective tests) every year. And the federal report that was meant as a “blueprint” for reform of no child left behind very clearly discusses USED’s desire to increase “college readiness.”
Over the past few months, GCO’s working group on college and career readiness has met and started defining its research agenda in the area of improving college readiness outcomes.
In its first few meetings, the group has looked specifically at college readiness. The group has chosen to focus its efforts in this area by looking at the particular issues of three sets of students:
a. Students in college but not prepared for it;
b. Students currently in high school and in danger of dropping out;
c. Students in high school (not in danger of dropping out), but not on track for college or careers.
Today, the group will meet at Georgia Gwinnett College, and will hear presentations about issues related to students in need of remediation and first-generation college students. SAT, ACT, and USED have suggested college readiness standards or goals, as noted above. More practically for Georgia schools, the University System of Georgia has defined what it means to be “college ready” through its Required High School Curriculum. The requirements are reasonable, and both public and private schools in Georgia know what these requirements are and help their students meet them. But the fact remains that large numbers of students who would like to attend college, and work toward (and often attain) these credentials are still not college ready. How might colleges support students who they have admitted, but who are not really college ready? What can K12 do to ensure that their graduates are able to do what they want to with their lives, or, as GCO often puts it, reach “middle class by middle age?” This ground is where GCO’s working group will conduct its research and find recommendations.
This is just the first stage in the group’s work. In the coming months, the group will look more specifically at career readiness, broadly-defined: career academies, vocational education, apprenticeships, etc. Other areas the group will explore as it works toward policy recommendations are: looking at the impact of teacher effectiveness, teacher training, and teacher career responsibilities on college- and career-readiness outcomes; exploring the possibilities that may come from online learning technologies and related strategies such as competency-based learning; and other areas the group finds necessary and worthwhile.