The Employment Situation in Maine - December 2023

January 23, 2024

Released: Tuesday, January 23, 2024 at 10 a.m. Contact: Glenn Mills, 207-530-2079

The Employment Situation in Maine - December 2023

Nonfarm jobs reached an all-time high and unemployment increased, each for the fifth consecutive month. These indications are based on preliminary estimates. Annual revisions to these datasets that will be published in March are likely to show that workforce conditions developed with less variability throughout 2023 than currently official preliminary estimates portray.

This news release presents estimates derived from two monthly surveys. The Current Population Survey collects information from households on labor force status, including labor force participation, employment, and unemployment. The Current Employment Statistics survey collects information from nonfarm employers by industry on the number of jobs, hours worked, and wages paid to individuals on their payrolls. Both surveys are administered by the U.S. Bureau of Labor Statistics. Preliminary estimates from the two surveys sometimes diverge in direction or magnitude of change. Annual revisions published each spring tend to bring them in to better alignment.

Statewide Seasonally Adjusted Labor Force Estimates

The preliminary unemployment rate estimate increased slightly from 3.0 to 3.2 percent for December. This was the 25th consecutive month the rate was below four percent the second longest such period. Unemployment remained well below the 5.5 percent average since January 1976, when the current estimating methodology was adopted.

Preliminary unemployment estimates decreased each of the first four months, stabilized at all-time lows through July, and then increased each of the last five months of 2023. The rate for December was the highest in 22 months. The undulating pattern of preliminary rates throughout the year is common; it is not as indicative of underlying trends as it may appear.

The survey that unemployment estimates are derived from is based on a sample of households that is relatively small, which leads to some variability in preliminary monthly estimates. Annual revisions smooth the pattern. In March when revised rates for 2023 become official, replacing preliminary estimates, they are likely to show a smoother pattern with unemployment fluctuating less throughout the year. A chart depicting variable preliminary rates and the smoother pattern of revised rates for 2016 to 2018 - https://www.maine.gov/labor/cwri/publications/pdf/LAUS_SABnchmrkComparison16-18.pdf .

The U.S. unemployment rate was 3.7 percent. This was the 193rd consecutive month Maine had a lower rate than the nation, except for three months in 2021 when they were the same. The New England rate was 3.1 percent.

Statewide Seasonally Adjusted Nonfarm Jobs Estimates

Preliminary nonfarm wage and salary jobs estimates increased 1,100 in December and 9,500 from a year ago to 656,400. This was the fifth consecutive month jobs reached a new high. Preliminary estimates indicate that all net job gains in 2023 occurred after July. Job gains were concentrated in healthcare and social assistance (58 percent) and professional and business services (28 percent), which accounted for most of the 12-month increase.

Early indications are that jobs estimates will be revised somewhat higher for the first three months of 2023 and somewhat lower thereafter. This represents a more consistent pattern of job gains through the course of the year, rather than little change in the first half and strong growth in the second half that preliminary estimates portray.

County and Metro Area Not Seasonally Adjusted Labor Force Estimates

On a not seasonally adjusted basis the statewide unemployment rate was 3.4 percent. Of the 16 counties, rates were at least 0.3 percentage points higher than that in six counties, at least 0.3 points lower than that in four, and close to the average in six. Rates were lowest in Sagadahoc and highest in Piscataquis counties.

Among the three metro areas of the state, unemployment was below the statewide average in Portland-S. Portland and close to the average in Bangor and Lewiston-Auburn.

(Labor force estimates for substate areas, including unemployment rates, are not seasonally adjusted. Because of this, estimates for a certain month should be compared to the same month in other years and should not be compared to other months in the same or other years.)

Statewide and Metro Area Not Seasonally Adjusted Hours and Earnings Estimates

The private sector workweek averaged 33.1 hours and earnings averaged $31.34 per hour in December. Average hours decreased 0.2 and hourly earnings increased 5.4 percent from a year earlier. Earnings increases were led by a 11 percent gain in manufacturing. The workweek was longest in construction and shortest in leisure and hospitality. Earnings were highest in professional and business services and lowest in leisure and hospitality.

Hourly earnings were higher than the statewide average in the Portland-S. Portland metro and slightly lower in Bangor and Lewiston-Auburn.

This news release is available in a more accessible format - https://www.maine.gov/labor/cwri/news/release.html

Due to annual data revisions, release of January 2024 workforce estimates will be delayed until Monday, March 11 at 10 a.m. Revised statewide data for prior years, including 2023 annual averages, will be published Friday, March 1. The data release schedule - https://www.maine.gov/labor/cwri/releaseDates.html

Nonfarm jobs data is available - https://www.maine.gov/labor/cwri/ces.html

Unemployment and labor force data is available - https://www.maine.gov/labor/cwri/laus.html

NOTES:

1. Preliminary seasonally-adjusted labor force estimates, including rates (labor force participation, employment, and unemployment rates), and levels (labor force, employed, and unemployed), as well as nonfarm wage and salary job estimates are inexact. Annual revisions (published in March each year) add accuracy. A comparison of 2021 and 2022 revised and previously published estimates is available in this blog - https://www.maine.gov/labor/cwri/blogs/2023workforcedata_revisions.pdf .

2. The 90 percent confidence interval for the statewide seasonally adjusted unemployment rate for December was between 2.4 and 3.9 percent.

3. Nonfarm wage and salary jobs from the payroll survey provide a better indication of changes in employment than resident employment from the household survey. The payroll survey is larger and has smaller margins of error.

4. Nonfarm payroll jobs estimates tend to be variable from month to month because the representativeness of reporting employers can differ. Seasonal adjustment is imperfect because weather, the beginning and ending of school semesters, and other events do not always occur with the same timing relative to the pay period that includes the 12th day of the month, which is the survey reference period. This sometimes exacerbates monthly changes in jobs estimates. Users should look to the trend over multiple months rather than the change from one specific month to another. Jobs estimates for the period from April 2022 to September 2023 will be replaced with payroll data in March 2024. Those benchmark revisions usually show less monthly variability than previously published estimates.