The latest information about the job market in Florida and Orlando was released on Friday. The headline numbers looked good: Florida added nearly 33,000 jobs in March and the unemployment rate fell to 7.5% while the unemployment rate in Orlando declined to 6.6% with employment rising by 3500 (metro data are not seasonally adjusted). Of course it's important to look at the details.
The entire decline in the unemployment rate for Florida was due to a decline in the labor force participation rate, which fell from 60.5% to 60.3%. If the participation had remained constant, the unemployment rate would be 7.8%. In terms of nonfarm payrolls (employment), nearly a third of the jobs were in accommodations and food services. However, a sizeable portion was also in construction, which was the fastest growing sector of the economy. Add it up and it was a pretty good report for Florida.
The decline in Orlando's unemployment rate was due in part to a somewhat strong job market, but a significant portion resulted from seasonal factors and a decline in the labor force participation rate. What really stood out was that over 90% of the job growth in March was due to leisure and hospitality (3200 out of 3500); that sector also accounted for over 60% of employment growth over the last 12 months. The high concentration of job growth in one sector and the fact that leisure/hospitality jobs have lower pay than most other sectors raises questions about the strength of the Orlando economy. So there's a mixed picture for metro Orlando: a sizeable decline in the unemployment rate, but employment growth concentrated in one of the lowest paying sectors. One other item to note is that construction employment declined in March as well as over the last 12 months, which does not seem to fit with the anecdotal evidence of increasing construction activity.
What are the key takeaways? Job growth in Florida is outpacing that of the nation over the last year, though Orlando is coming up short (1.9% growth for Florida, 1.4% for the US, and 1.3% for Orlando). Given cutbacks in government employment, private sector employment growth is stronger (2.4% for Florida, 1.6% for Orlando). Florida's labor market continues to improve, but similar to the nation, a declining participation rate is contributing to the declining unemployment rate. Orlando's job market also is improving, but there are concerns about the quality of jobs as well as growth being concentrated in one sector rather than broad-based gains.