Let the recovery begin.
Job growth in the Buffalo Niagara region accelerated to a 21-month high during November in a spurt of hiring that allowed the local job market to regain all of the jobs that it lost during the Great Recession, the state Labor Department reported Thursday.
That’s an important benchmark, and one that has been difficult to achieve in the past. The Buffalo Niagara region never recovered all of the jobs it lost during the 2001 recession. The local job market would need to add nearly 6,000 more jobs to reach that point. The region took nine years to recover all of the jobs it lost during the 1990 recession.
And even though the nation’s job growth has been more robust than the expansion in the Buffalo Niagara region for most of the last three years, the job market here managed to complete its recovery from the downturn in five years. That’s something the U.S. economy can’t claim. The nation still is about 1.4 million jobs behind its January 2008 peak.
“Part of it is psychological,” said John Slenker, the Labor Department’s regional economist in Buffalo.
“We’ve made it over the hump. You’re no longer recovering from the recession. You’re growing,” he said. “We haven’t been able to say that in the Buffalo Niagara Falls region for a while.”
The November jobs report showed that the region continues to add jobs at a modest, but slowly increasing, rate. The 1.3 percent increase in the total number of jobs in the two-county region over the past year was the fastest annual growth for any month since March 2012. And the growth rate was at a pace that has been surpassed in only five months since the beginning of 2000 — a period that spans 167 months.
“We used to be a punch line in many ways,” Slenker said. “Nobody is laughing now.”
The jobs report highlighted several bright spots in the Buffalo Niagara job market:
• The region’s job growth during November tied with Glens Falls for the strongest gains among any of the 11 upstate metro areas included in the Labor Department data. The region’s job growth was more than three times stronger than the 0.4 percent increase across all of upstate New York.
• October’s job growth was slightly stronger than initially reported. The Labor Department revised its October job data upward, reporting that the region added jobs at a 1 percent annual pace during that month, slightly better than the 0.9 percent increase it initially reported.
• Private-sector employers are driving all the growth in the local job market. The region added 7,200 jobs during the past year, all of them in the private sector, which grew at a 1.4 percent annual pace. Those gains offset continued job cuts by the federal government.
• The region during November was adding new positions at a pace that is at the higher end of the range that has been typical of nonrecessionary periods over the last two decades, when employment growth generally has ranged from flat to expanding by as much as 1.6 percent on an annualized basis.
“I see some very positive signs,” Slenker said. “By Buffalo standards, this has been a surprising run.”
The surprises started with the Great Recession, which broke from the region’s traditional patterns that typically saw Western New York fall into a recession before the rest of the country, fall deeper and take longer to recover. This time, the Buffalo Niagara region began declining after the rest of the country and didn’t fall as far.
And while the pace of local job growth lately has been lagging behind the nation, the Buffalo Niagara job market managed to climb out of the hole that was dug during the recession sooner than the rest of the country,because the milder nature of the downturn here meant that the local employment losses were not as severe as they were elsewhere.
“Part of it was we didn’t see the big boom in housing prices. We didn’t see the big growth” that other U.S. markets did before the recession hit, Slenker said.
Still, there are some clouds hovering over the local job market.
Despite the recent improvement, job growth here continues to lag behind the rest of the country.
While the November job growth was the region’s strongest since March 2012, it still was slightly weaker than the statewide increase of 1.4 percent and even further below the nationwide job growth rate of 1.7 percent during the same period. Job growth topped 2 percent in the biggest downstate markets.
The November jobs numbers “show a striking regional divergence in job-creation trends ... with the economic weakness concentrated in upstate New York,” said E.J. McMahon, the president of the Empire Center for Public Policy, an Albany-based think tank.
And while the 1.3 percent increase in jobs was the strongest growth the Buffalo Niagara region has seen in 21 months, the national economy has been adding jobs at an annual pace of 1.3 percent or better for 28 straight months, dating back to August 2011.
During November, the region’s job growth was bolstered by a 4 percent increase in hiring by temporary help agencies and by health care and social assistance firms. The financial services sector grew by nearly 3 percent, while trade jobs increased by just under 1 percent.
Overall, the region’s private sector firms that provide services added jobs at a 1.9 percent pace during the past year.
Those gains were partly offset by a 5 percent drop in federal government jobs, while the continued weakness in manufacturing led to the loss of slightly less than 1 percent of the region’s factory jobs over the past year.
“Manufacturing is basically stable. We’re not bleeding jobs like we had been, and our service-providing sector is doing well,” Slenker said.