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Metro Tucson gains12,000 jobs; growth still lags state

Metro Tucson gained 12,000 mostly service jobs over the past year and its unemployment rate in November remained below Arizona's, according to the latest state estimate.

The Tucson region's 3.1 percent growth in jobs from November 2017 to November 2018 wasn't as good as Arizona's 3.6 percent rate or metro Phoenix's 4.2 percent growth. But it's better than the U.S. rate of 1.6 percent, said the Arizona Office of Economic Opportunity.

The jobless rate for metro Tucson inched up to 4.2 percent in November from 4.1 in October. Arizona's rate rose to 4.7 percent from a revised 4.6 percent rate in October. Metro Phoenix's rate remained at 3.8 percent.

The bulk of Tucson's new jobs added over the year (8,700, or 73 percent) were in services, such as restaurants, stores, construction, teaching, health care and package deliveries. The rest were in manufacturing, including an estimated 900 in aerospace products.

Arizona's population growth is among the fastest in the nation, and that is helping drive job growth.

The state ranked third in the nation (behind Florida and Texas) for its net migration growth of 97,575 from 2017 to 2018, according to the  U.S. Census Bureau. It also ranked fourth in population growth from 2010 to 2018 behind Nevada, Idaho and Utah.

Arizona added 103,200 nonfarm jobs over the year, according to the state Office of Economic Opportunity. Eighty-four percent of those went to metro Phoenix.

Whether newcomers or college graduates, more people are looking for jobs. The labor force participation rate, which measures the percent of people 16 and older who are working or looking for work, reached 61 percent in November, which is the highest rate in nine years.

Arizona's job growth came in all 11 of major industry sectors, although the growth ranged widely, from professional and business services, which added 21,000 positions over the year, to natural resources and mining, which grew by just 200.

"This is a significant number where we're seeing all eleven industry sectors recording positive gains," said Doug Walls, the agency's research administrator. "This is typically a sign that growth is not focused on one or two specific sectors."

Arizona's job numbers come from monthly surveys and are subject to major changes when they are revised in March to correlate with more accurate federal data. They also fluctuate from month to month, depending on when households and businesses are surveyed.

But while Arizona's employment picture shows diversity, population growth and construction appear to be major drivers.

The sector with the highest percentage growth is construction, which added 19,000 jobs over the year, for a 12.6 percent growth rate. 

Emerging Trends

Other trends that have emerged or are emerging are:

  • Rising interest rates and declining mortgage applications are shrinking the need for financial jobs, especially credit intermediation.That sub sector has been declining for two years and lost 1,900 jobs over the year.
  • Changes in the broad trade, transportation and utilities sector used to be driven largely by retail jobs. Now the fastest growing segment (7.2 percent over the year) is warehousing and transportation, which is especially obvious now as trucks drive all over delivering packages, often from warehouse type fulfillment centers.
  •  Manufacturers added 10,200 employees over the year for a 6 percent growth rate. "This is some of the fastest growth and largest growth since the mid 1990s. So this is a new trend in manufacturing, and it continued to strengthen in November," Walls said. Computer and electronics parts added 3,600 employees, for 11 percent growth.
  • Ambulatory health care jobs showed unusual strong hiring in November, adding2,300 jobs, compared to the typical 500.These included positions in outpatient centers, and offices of physicians and other health care providers.
  •  Leisure and hospitality, which includes restaurants, bars and hotels has been laying off fewer workers in the summer and hiring more people in the fall.
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