Annual Job Gains Slow Across Many Markets in July

In perhaps a sign of an impending slowdown, an increasing number of markets experienced a decline in their annual job gain totals from the month before.

According to the latest release from the Bureau of Labor Statistics (BLS), eight of the top 10 markets for employment gain had smaller annual totals in July than in June, reversing a trend of increases from last month. The remaining two top 10 markets were essentially unchanged.

While New York continues to lead the nation in annual gains, its 392,600 jobs added in the year-ending July was almost 23,000 fewer than June’s annual total. Last month’s #2 market – Los Angeles – fell to #5, gaining 174,000 jobs, 63,300 less than in June.

With Los Angeles’ tumble, Dallas moved into the #2 spot with 211,100 jobs gained but that was 22,200 short of June’s total. Chicago and Houston each moved up one spot following Dallas but while Chicago actually gained 1,000 jobs to take its annual total to 202,800 jobs, Houston slipped almost 11,000 jobs to bring its annual gain to 188,900 jobs.

Atlanta, Boston and Philadelphia returned to the #6 to #8 spots, adding 152,800, 127,700, and 123,300 jobs, respectively. Atlanta’s annual total dipped by almost 15% or 26,500 jobs from last month’s annual gain, while Boston and Philadelphia had only a few thousand fewer jobs added than in June.

Detroit replaced Washington, DC (which fell to #15) in the top 10 list at #9 with 97,200 jobs added for the year, unchanged from June. Seattle remained in the #10 spot, gaining 95,800 jobs in July, about 2,500 fewer than the previous month’s annual gain.

These month-over-month comparisons of not seasonally-adjusted labor data from the BLS can sometimes be misleading, but nonetheless give an idea of overall trends. In July, only 34 of our top 150 markets had higher annual job gains than in June with another four unchanged compared to 83 improving markets last month.

As with the top 10, only two of the next 10 markets had higher annual job gain totals than in June, and only one of the next 10 markets after that (a total of five of the top 30 markets). There was no discernible pattern (geographic, or otherwise) to the markets with the steepest declines in annual job gains but bear in mind that all of these markets had positive job growth as none of our top 150 markets reported job losses for the year-ending July.

With these slowing job gains, the positive momentum that has helped many markets recover all of the jobs lost early in the pandemic recession has stalled. Last month, 85 of our top 150 markets had returned to or bettered their February 2020 employment level but that has slipped back to 80 markets in July. Of the top 10 job gain markets, New York and Los Angeles still have a long way to go to recover all of their pandemic-induced job losses, while Detroit is close at just 6,800 jobs to go.

Only three of the next 10 top 150 markets ranked by July job gain are below their pre-pandemic employment bases, the same as last month. Of those, Orlando is closest to regaining its pre-pandemic employment level, while Anaheim and San Francisco are each about 18,000 jobs short of recovery.

With the slowing employment gain momentum, only eight markets had annual job gains of 100,000 or more compared to nine in June and 19 last July. Another 21 markets gained between 50,000 and 99,999 jobs, one less than last month. None of RealPage’s top 150 markets had an annual job loss from last July.

Like annual job gains, the annual percentage change in employment slowed in the majority of markets. Only six of June’s top 10 returned in July with two additional major and two smaller markets joining the list.

Dallas again led the nation for percentage annual growth in employment at 7.7%, a decline of 80 basis points (bps) from last month, while Miami moved into the #2 spot with 6.8% growth (down 50 bps from June).

San Francisco moved up one spot to #3 with 6.4% growth, dropping 70 bps for the month while Las Vegas dropped to #4 with 6.3% growth, down 160 bps from last month and 820 bps from last July.

Houston improved two spots to tie newcomers Fort Worth and North Port-Sarasota-Bradenton, FL at #5 with 5.1% employment growth in July. Houston and North Port were down a few bps from last month but Fort Worth improved by 50 bps.

Austin remained in the #8 spot in July with 6% employment change but was down 40 bps from June, while the college town of Fayetteville-Springdale-Rogers, AR moved into the #9 spot with 5.9% growth. Perennial national job gain leader New York joined the top 10 percentage change leaders in July with 5.8% growth, yet that was still 40 bps lower than in June.

Dropping out of the top 10 list this month were Nashville, Orlando, Atlanta and Midland/Odessa.

Compared to one year ago, Austin joined Las Vegas as markets with the steepest drops in employment growth, falling 460 bps from July 2021. The remaining top markets averaged about a 60 bps decline from last year, although that includes three markets with an average 30 bps increase (San Francisco, Houston and Fort Worth).

The weakest major markets for percentage growth are still primarily in the industrial Midwest. Major markets with sub-2% growth include Akron, Cincinnati, Kansas City, Milwaukee, Richmond, Dayton, Omaha, Columbus and St. Louis. In addition to the top 10, strong job growth markets also include: Toledo, Newark, Seattle, Atlanta, Nashville, Riverside and Orlando. Fifty markets had annual job growth rates above the not seasonally-adjusted national average of 4% compared to 56 in June.