Why metro Atlanta’s unemployment rate increased in May

High school and college graduates typically enter the job market in late spring, and because many of them don’t find jobs right away, this influx increases the unemployment rate.

The number of people in the labor force increased by 15,520, bringing the unemployment rate to 3.4%, up from 2.8% in April, said Bruce Thompson, the state’s labor commissioner.

“This seasonal increase in labor force participation has a significant impact on summer unemployment rates,” he said.

Overall, jobless claims that typically follow layoffs are 15% below levels a year ago, the Labor Department said. In May, the Atlanta metro area had 110,547 people officially unemployed — without a job but actively looking for work.

This represents an active population of nearly 3.3 million people.

While the rise in unemployment is unwelcome, its rate remains historically low. Moreover, May was the 35th consecutive month that the level was below 4% and – at least so far – there are few signs of an imminent slowdown.

A few companies reported job cuts among state employees. Several Walmart stores were closed, leading to the loss of several hundred positions. Grocery Delivery E-Services USA announced the closure of its Newnan plant, eliminating more than 700 jobs.

Growth has slowed.

Payrolls in the Atlanta metro area increased 1.13% over the past 12 months, according to the Bureau of Labor Statistics. The year before, jobs increased 2.15%. And in the year ending May 2022, Atlanta jobs increased 6.19% as part of the post-COVID-19 recovery.

The slower overall growth reflects many companies’ attitudes toward the economy, according to Chris Arnone, a partner at Moore Colson, a 200-person accounting firm in Atlanta. “When I talk to clients, business leaders are cautious. They’re looking at expenses and headcount and want to make sure they’re in line with where they’re projecting their revenue to go.”

Whether with artificial intelligence or other techniques, companies want to make sure they’re getting the most out of the employees they currently have before hiring more, he said.

However, some skills are in high demand, particularly in financial services and accounting, Arnone said.

“There is a shortage in certain areas,” he said. “These are difficult positions to fill. »

A year ago, as the Federal Reserve raised interest rates to control inflation, economists largely agreed that a recession was all but inevitable. Instead, the jobs machine continued to churn, both nationally and in Georgia.

And the Atlanta metro area, with about 62 percent of the state’s jobs, continued to account for the bulk of the state’s expansion.

Some sectors are growing because they lagged during the pandemic, said Mark Vitner, chief economist at Piedmont Crescent Capital.

Hospitals and other health care jobs, which are a big part of Atlanta’s economy, have started hiring, he said. “And a lot of the lower-paying government jobs that they were struggling to fill are now being filled.”

Changes in consumer habits are reflected in increased spending at restaurants, concerts and travel, Vitner said. “The airports are all full, the restaurants are all full. The economy seems to be firing on all cylinders everywhere.”

However, this change could hide a certain weakness. For example, the post-pandemic shift towards services has forced transport and logistics to adapt to the fact that people are spending less on ordering goods for their domestic use. And Georgia’s vaunted film industry has seen cutbacks, with productions delayed for a variety of reasons.

Signs from the Fed suggest interest rates aren’t likely to fall for months, which means persistent headwinds. Consumer spending has been tepid of late. And while most economists now predict modest growth for the rest of this year, they were so wrong a year ago that caution seems reasonable, said Arnone, a partner at Moore Colson.

His firm, like many of his clients, is hiring and growing, but cautiously, taking an optimistic, but not exhilarating, outlook, he said. “Not pessimistic, not crazy, something in between. »

Metro Atlanta’s job market by the numbers

May unemployment rate in metro Atlanta

Highest, before the pandemic: 10.1% (2010, 2011)

Lowest, before the pandemic: 2.8% (1999)

Average, before the pandemic: 5.4%

Recent: 3.4% (2024)

May, Job Change in Metro Atlanta

Best, before the pandemic: 22,600 (1996)

Worse, before the pandemic: -2,400 (2009)

Average, before the pandemic: 12,770

Recent: 8,500 (2024)

May to May, Atlanta metropolitan area growth rate

2019: 2.42%

2020: -10.12%

2021: 9.47%

2022: 6.19%

2023: 2.15%

2024: 1.13%

Sources: Bureau of Labor Statistics, Georgia Department of Labor

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