Revised Data Shows That Things Weren’t So Bad After All

Kansas City area employment data has been a bit of a head scratcher the past couple of years. As the economy started to recover, the rest of the nation began to see real employment growth, but that growth seemed (according to the data) to miss Kansas City. The chart below shows the country (the yellow line) experienced modest year-over-year employment growth of about 1 percent starting in mid-2010. In the Kansas City area, however, data showed that employment was stagnant at best (the red line) and declined at a 1 percent clip during some periods. This decline seemed to run counter to other, more positive employment data we were seeing, like increases in help wanted ads, and decreasing unemployment rates.

To assess current employment trends, we rely on data from the Current Employment Statistics — data the Bureau of Labor Statistics gathers from a monthly survey of approximately 486,000 worksites across the country. Once a year, BLS re-benchmarks the CES to reflect new data from the Quarterly Census of Employment and Wages (QCEW). The revised data (the blue line) now shows the Kansas City area economy has been recovering right along with the rest of the country, not lagging.

The lesson to remember here is that initial local employment data is often revised — and sometimes those revisions can completely change our perceptions of how we're doing.

The new data solves what had been a big mystery for Kansas City area employment watchers. The early stages of the nation’s employment recovery did not pass us by after all. Instead, we've actually experienced real employment gains over the past year and a half.

As always, we like to keep things in perspective. Even with these new and better numbers, metro-area employment is still down by more than 50,000 from its pre-recession peak. But we can be more confident that the region’s economic recovery is on track.

The new data may tempt us to shout "We’re back," but the truth is, we never really left.

Kansas City Leads all Large Metros in Unemployment Rate Decline

At KCeconomy we often compare the Kansas City region to our peer metro areas, and generally we like to be on top. In the case of annual unemployment rate change, however, the lowest number is exactly where we want to be.

New data shows that Kansas City had the largest drop in unemployment rates among our peer metros between January 2011 and January 2012. Over the past year, our unemployment rate dropped 2.1 percentage points and now stands at 7.3 percent. Not only did we outperform our peers in this area, but our unemployment rate had the greatest drop of all large metros in the country!

For some time, we have puzzled over the sluggish performance of the region’s labor market. As the nation has started to recover jobs, we seemed to lag. Data from late 2011 showed that local employment activity might have started to pick up steam, and today’s data suggests that Kansas City has really begun to make up for lost time.

While our unemployment rate is dropping faster than other metros, as indicated in the chart above, we still have room for improvement. The chart below shows that our current rate is still higher than many of our peers. That’s another statistic where we aspire to be on the bottom – with the lowest number, that is.