Monitoring Recovery | Indicators to Watch and Metrics that Matter

September 4, 2020 - To build an understanding of current labor market trends and conditions that are impacting the Memphis Metro area, the Chamber will release an update to our economic recovery in two-week intervals. With the release of the July 2020 unemployment numbers on September 2, these updates will provide a key snapshot of where the Memphis market sits as it relates to a recovery in the local economy.

The Greater Memphis Chamber develops insights that help stakeholders ask the right questions to issues impacting our region’s economic competitiveness. To understand the impact of COVID in the current economic environment, the team analyzes data using a combination of sources such as the Bureau of Labor and Statistics as well as cutting-edge tools such as Burning Glass Labor Insights and EMSI, the Chamber aims to provide stakeholders with information that can help drive prosperity for all in the region.

This week’s update includes:

• The National Bureau of Economic Research officially declared the US economy in a recession on Monday, June 8. Starting in February, this recession ends a decade long period of economic expansion and the longest in recorded US history.
  
• On June 26, 2020, the Executive office of the federal government signed an order prioritizing job skills over college degrees in government hiring. This theme is highlighted on key slides within the Market Overview report.
• This edition of the Greater Memphis MSA Market Overview highlights select labor market indicators that are published on a monthly and a weekly schedule.
  
  
• The higher frequency weekly indicators, noted on the following page, serve as leading indicators and could signal worsening or better employment outcomes for the region against the monthly reports.

Indicators to Watch

Key insights from this report:

• Monthly Indicators, [lower frequency]

  • July 2020, the unemployment rate in the Greater Memphis MSA rose 1.4 seasonally adjusted points to 12.7%. This increase places the market higher than both the State of Tennessee and the Nation at 9.5% and 10.2%, respectively. Shelby County holds the highest unemployment rate in the State of Tennessee, with a July 2020 rate of 14.4%. The next release for (August 2020) metropolitan employment estimates will be September 30, 2020.
    
    
  • With over 80,000 individuals unemployed in the metro area (July 2020), displaced workforce should leverage transferable skills, discoverable through the SkillsMatch and the Resume Optimizer applications, found on the Chamber’s website. Leveraging transferable skills will allow for the development of competitive language and positioning in a sector that is currently hiring.
    
    
  • Non-farm payrolls (jobs) in the Memphis metropolitan area increased by a seasonally adjusted 3,800 in July 2020, a month-over-month increase of 0.623%. The net increase in month-over-month jobs was primarily realized through Trade/Transportation and Professional/Business Services, which collectively added 3,100 jobs in July.
    

  Weekly Indicators, [higher frequency]

  • Continued claims rose through the month of July, adding upward pressure to the unemployment situation. However, since the July 25th end of the federal UI supplemental payment program, initial and continued unemployment insurance claims have decreased significantly. Assuming individuals have gone back to work directly, adjustments should be illustrated in the August 2020 numbers. Industries with the largest decrease in continued claims included: Accommodation and Food Services, Admin. and Support Services, and Retail Trade.
    
  • Online job postings, a proxy for employer demand, decelerated in the first half of July and realized a sharp contraction in the first week of September. The most recent reduction places online job postings only 1.9% above the May 2 trough. While indicative of demand, jobseekers should leverage skills for in-demand occupations within new industries.
    
    
  • While the Greater Memphis market has seen a rise in July 2020 unemployment rate, many employers have ramped up in hiring. This ramp-up suggests that a shift in workforce requirements is being realized and will remain as industries stabilize in the near-term.

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