Florida's recovery looks solid with unemployment rate falling to 5.3 percent

Bay area unemployment falls to 5.2 percent, but the quality of new jobs is still a concern.
Published September 18 2015
Updated September 19 2015

Fueled in part by low gas prices, Florida's economic recovery keeps rolling.

The state added a solid 19,600 jobs in August — second-best in the country to California — as its unemployment rate tumbled to 5.3 percent, the lowest mark in more than seven years. Tampa Bay, where unemployment dipped to 5.2 percent, was second only to Orlando among Florida metros in creating jobs over the year.

Longtime Florida watcher and economist Mark Vitner said he expects the state's years-long rebound to continue with "minimal disruptions" from the global slowdown that has roiled the markets recently.

"Florida's economic growth is driven primarily by what is going on in the U.S. economy and that still looks pretty solid," said Vitner, managing director and senior economist with Wells Fargo Securities.

Still, there's reason to keep any celebrations to a minimum. The two big caveats of the recovery haven't gone away:

• A concern over quality of jobs persists. In Tampa Bay, for instance, nearly half the jobs added year over year are in the low-paying leisure and hospitality industry.

• And the percentage drop in unemployment for years has been likely overstated, economists say, because Florida's labor force is still shrinking. The labor force contracted another 4,000 last month despite the influx of 24,000 more residents 16-and-up. Over the year, the labor force is down by 87,000 people despite a population gain of 263,000.

Some labor pool shrinkage is because of retirees, economists say, but it's also tied to those who are no longer actively looking for work so they aren't counted in calculating the unemployment rate. If discouraged job seekers start looking again, that could push up the unemployment rate.

Those negatives aren't enough to dampen enthusiasm from some.

"We'll take this for now," said Scott Brown, chief economist with Raymond James Financial in St. Petersburg. "We're not at the end game yet, but you wouldn't expect that. … This was a major recession and you just don't get out of bed and run a marathon. It takes a long time to repair the damage."

Brown said he's not surprised the twin-tourism meccas of Orlando and Tampa Bay are leading the way in job growth this past year. Low gas prices have helped lure a record number of tourists to theme parks and beaches.

Along with tourism, two other industries known for lower wages — health care/social assistance and retail — have been major contributors to Florida's growth.

But Vitner said he's encouraged to see solid job gains across the board, particularly in business services and construction. The number of construction jobs dropped slightly in August but is still up more than 25,000 from August 2014.

Even government and manufacturing have added 7,200 and 6,100 jobs, respectively, over the year. The only industry still ailing is information, down 1,000 jobs from a year ago.

Over the month, Tampa Bay added 15,000 jobs to its workforce of 1.2 million.

The bay area is tops in the state in online job demand with 51,652 openings posted in August. Countering the relative abundance of lower-paying jobs, Gov. Rick Scott's office noted Tampa Bay also leads demand statewide for some higher wage jobs as well, with 15,768 openings posted last month in science, technology, engineering and math occupations.

Scott, who went to the Boca Raton offices of home security firm ADT to release the monthly jobs report, took the long view.

"Our unemployment rate has been cut in half over the last four and a half years," the governor said. "We want Florida to be the first in the nation for jobs and with more than 940,000 private-sector jobs added since December 2010, we are well on our way to reaching that goal."

Contact Jeff Harrington at [email protected] or (727) 893-8242. Follow @JeffMHarrington.

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