January 9, 1998 in Nation/World

Idaho Employment Could Break Record Economist Predicts Unemployment Rate Could Fall Below 5 Percent This Year

Staff And Wire Reports Staff W
 

Idaho’s economic expansion may be cooling, but the state’s top labor analysts on Thursday predicted the brightest outlook for job seekers in state history.

James Adams, the head of research and analysis for the state Department of Labor, told a special legislative committee that the jobless rate for 1997 will probably average a record low 5 percent, a tenth of a point below the previous record of 5.1 percent in 1989.

In North Idaho, meanwhile, the jobless rate recently dipped to its lowest point since 1991, hitting 7.5 percent in November.

Kathryn Tacke, labor market analyst for the Job Service office in Coeur d’Alene, said the five northern counties will probably show average unemployment of 8.4 percent for 1997.

“Although the rates have gone down in the last few months, the overall rate remained relatively high because of the severe winter and the long spring breakup we had,” Tacke said.

The unemployment report for December will be released on Friday, but Adams’ statement indicated the seasonally adjusted rate will again be under 5 percent for the fifth month. It was 4.8 percent in November and never exceeded 5.3 percent all year.

Adams said the department projects job growth at 2.3 percent for both 1998 and 1999, matching anticipated growth rates for the population overall in a combination that should drive unemployment rates to new record lows.

He said the unemployment rate this year should average 4.7 percent and then fall again to 4.5 percent in 1999.

“Our view is that Idaho’s employment picture for the next two years will be one of healthy growth,” he told the House-Senate panel conducting its own assessment of Idaho’s economy in anticipation of this winter’s legislative session.

“There will be continuing diversification in the economy,” Adams said, “but the pace of growth will be slower, not as hectic as in the mid-1990s” when the job base was expanding by up to 6 percent a year.

Private economists reinforced Adams assessment. Both Kelly Matthews at First Security Bank and John Church of Idaho Economics and formerly the chief economist for Idaho Power Co. told the panel not to expect Idaho’s economy to be any stronger in 1998 than it was last year.

“It’s hard to find examples of what would create a new accelerated growth in Idaho,” Matthews said. “It’s a favorable forecast to sustain the growth we have now.”

In terms of state tax receipts, which are key to lawmakers, that would appear to be in the area of 5 percent to 5.5 percent. The Batt administration forecast revenue growth at 4.9 percent for the current budget year, but through the year’s first five months the growth has been 6.6 percent.

The forecast decline to new record lows in the average unemployment rate will escalate pressure on wages, Adams said. But with 77 percent of all nonfarm jobs in the typically lower-paying service sector, wages in Idaho remain anemic compared to national averages.

Workers in the northern counties have seen a switch from a labor market that was “very employer-oriented to one more favorable to job seekers,” Tacke said, adding that jobs are especially tight in the retail and service sectors.

“But I wouldn’t want to overstate the shift,” she said, “because the Panhandle still has a higher rate of unemployment than the Idaho average.”

Overall, Tacke expects to see “normal increases” of 2 to 4 percent in most job categories for North Idaho.

New statistics show the average annual pay in Idaho this year at $20,900, rising to nearly $21,500 in 1999. For the fiscal year ending July 30, 1997, average annual pay in North Idaho was $21,226, Tacke reported. That compares to a national average annual wage this year of $32,600, rising another $1,000 in 1999.

But over 20 percent of the state’s more than 600,000 jobs have an average salary of under $14,600.

, DataTimes MEMO: This sidebar appeared with the story:

The outlook

Unemployment: 5 percent for 1997, 4.7 for 1998 and 4.5 for 1999.

Job growth: 2.3 percent for both 1998 and 1999.

Average pay: $20,900 in 1998 and $21,500 in 1999.

The following fields overflowed: CREDIT = Staff and wire reports

Staff writer David Gunter contributed to this report.

This sidebar appeared with the story: The outlook Unemployment: 5 percent for 1997, 4.7 for 1998 and 4.5 for 1999. Job growth: 2.3 percent for both 1998 and 1999. Average pay: $20,900 in 1998 and $21,500 in 1999.

The following fields overflowed: CREDIT = Staff and wire reports Staff writer David Gunter contributed to this report.


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