PHOENIX — The state’s jobless rate ticked up again last month, the third time in four months, even as the national rate dropped.
But Doug Walls, the labor market analyst for the Arizona Office of Economic Opportunity, said Thursday he’s not seeing anything causing him great concern. He noted the 3.7% seasonally adjusted unemployment rate, while up two-tenths of a percent from August, is still below the state’s pre-pandemic average.
Some of that is job creation in Arizona, up by 102,500 as reported by private sector employers since last year. But what’s growing even faster is the number of people in the labor force, both employed and not.
Consider: A household survey last month showed total employment approaching 3.5 million. That’s up by 3,242 from August.
But the labor force increased by 11,717. So more people available to work, whether by reentering the labor market or moving to Arizona, translates to a higher unemployment figure.
And there’s something else.
Walls said a separate report shows there are close to two open jobs for every unemployed person.
“So I think the labor market is still tight,” he said.
“There are employers that are looking for employees,” Walls continued. “They still are not able to find them.”
That search for workers, in turn, is having ripple effects.
Average hourly wages in Arizona hit $30.57 in September. That’s up 7.8% from the same time a year earlier.
By contrast, wages on the national level are up 4.9% year over year, though the average of $32.40 is still higher than the state.
Still, costs at the state level are eating up pay increases at an even faster rate.
The Bureau of Labor Statistics said the September consumer price index for Maricopa and Pinal counties — the only two in Arizona they measure — was up 13% from the same time a year earlier.
That is being driven not just by the price of gasoline, with energy prices up 19.2%, but the cost of housing, especially for renters where costs are up 21.4%.
National inflation was up just 8.2%.
One area of the economy that may bear watching in the coming months is the construction industry.
Sharply higher mortgage rates appear to be finally driving housing prices down in Arizona.
The median listing price of a home in the state dropped last month to $477,500, down close to $12,000 from the prior month. And while that’s still 6.2% higher than the same time a year earlier, it appears to be a trend, with the data from Realtor.com showing a continuing decline from earlier this year when the average his $520,950.
At the same time, the number of homes on the market increased to 23,791 in September. That’s up 2.3% from August — and 128.5% from last year.
The median number of days properties are on the market increased to 48 days last month from 40 days the month before.
And housing starts, as measured by the number of new building permits, decreased 2.8% in August, the most recent figures available.
Walls said that’s all being affected by the decisions by the Federal Reserve Board to raise interest rates.
“With interest rates increasing, that does impact the monthly mortgage rate that a buyer would have to pay,” he said. “So individuals that might have been able to afford a house when interest rates are low, they might either be thinking twice about that.”
And Walls said buyers, seeing some trends in prices, might be holding off on making a purchase.
But all that could reduce the number of people needed in construction.
“We haven’t seen it yet,” Walls said. “But we have to wait and see where construction employment goes from here.”
One other area of the economy also could be affected. Fewer home buyers and fewer people seeking mortgages could translate to fewer loan officers.
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