Is There a Jobs Exodus in Oregon?

The State Employment Economist announced Monday that Oregon’s unemployment rate for June held steady at 12.2%. That still remains the second highest in the nation and nearly one-third higher than the nation as a whole.

At first blush the news seemed encouraging — that the employment picture was stabilizing — but when you look behind the numbers, Oregon’s employment crises continues unabated.

The unemployment numbers reflect the total number of people having filed for unemployment compensation. In Oregon today that number is 241,156 and that is compared to 113,722 a year ago — more than double the number. But the unemployment numbers can be deceptive since they simply reflect the number of persons receiving benefits and not the total number unemployed.

The unemployment benefits numbers can be effected by those dropping off because they have run out of the number of weeks for which benefits are available and by those dropping off because they have become discouraged and left the state — a view that the State Employment Economist appears to espouse although he cites no data to support such a conclusion.

The real health of Oregon’s job market is more correctly described by the number of people working rather than the total number of people receiving unemployment benefits. And when we look at those numbers the picture is one of significant continuing decline in not only the total number but in the critical categories of well paying jobs. The total number of people working in Oregon in June of this year was 1,643,000; down 7,200 jobs from May of this year. So even though the numbers of those receiving unemployment compensation remained relatively constant, the actual number of jobs declined at about the same rate as the previous 11 months.

As of June of 2008, there were 1,741,000 people employed in Oregon. This month’s report represents a decline of approximately 98,000 jobs or 5.6% of the workforce from the 2008 numbers. But of significant interest, the number of people employed in June of 2008 — at a time of relatively low unemployment for Oregon (5.9%) — was 7,000 people less than the previous June, 2007. Even in what appeared to be good times based on unemployment numbers, private sector employment was declining.

The 98,000 jobs lost year over year is also deceptive because while private sector employment has been steadily declining, government employment has been increasing. If you exclude the growth in government employment, the total number of jobs lost in the private sector exceeds 104,000. And the job losses are disproportionately borne by the high paying sectors of manufacturing, construction and transportation. Even the seasonal lift in these job sectors were less than in previous years with the exception of the construction industry which may be benefiting from increased government spending on highways and other capital projects — spending that is thus diverted from private sector investment which generally creates sustainable jobs rather than temporary. And even at that, the construction numbers are down over 15,000 jobs from the previous year — nearly 15%.

And then, right in the middle of this continued worsening of the jobs market, Gov. Kulongoski and the Democrat legislature raised taxes on Oregon’s businesses and further depleted the available investment capital for resurrecting Oregon’s economy. But if the preservation and growth of government is the primary goal, then what else would you expect.

While the State Employment Economist cites no data for his conclusion that the work force is leaving Oregon, I fear he is correct. The jobs are simply following the businesses that have left and those that are about to leave.

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Posted by at 06:00 | Posted in Measure 37 | 10 Comments |Email This Post Email This Post |Print This Post Print This Post
  • Max

    YES, there is.
    We have the worst employment figures in the nation except for MI.
    We have a VERY unfriendly business climate.
    Businesses are leaving OR in droves in case you have not noticed.
    They have been for years.
    All we will have left is the scenario where everyone is delivering pizza to everyone else.
    Total service sector crap. Low pay – nothing produced.
    See you at Starbucks my lovelies.

    • Rupert in Springfield

      In case you haven’t noticed, those jobs you are mocking: Starbucks and pizza delivery are minimum wage jobs. Several years back Oregon decided that minimum wage should become a “living wage”. The idea that one should be able to deliver pizza and have the same things as someone of who didn’t goof around in school and actually worked hard and took responsibility is the ethos here. To that end, minimum wage in Oregon is actually really good and only going up. Unfortunately that means there is greater unemployment, but Oregonians were warned in no uncertain terms about the consequences of such “progressive” ideas as indexing the minimum wage.

      Business owners supposedly don’t know anything when it comes to predicting economic outcomes, yet when it comes time to pay the bill, they seem to be the only ones smart enough to have the money to go after.

  • BlueTide

    It’s not that we have high unemployment…Oregon is taking the necessary progressive approach and just cleansing the job market of all those idiots that refuse to embrace the Green Revolution. If they want to work, they can learn how to braid hemp into clothing, or learn how to be a windmill mechanic, or sustainable organic farmer. These are the jobs that will save Oregon from disaster. Let small businesses rot on the vine while we provide Procrustean stimulus to those industries that fit our vision of no environmental impact and don’t perpetuate greed or consumerism by paying above our already generous mimimum wage. The Revolution is here! Embrace it and be assimilated, you capitalist scum!!

    • The Watcher

      I thought D-E-A-N was banned from posting under any mantra.

      • Sneaky

        Don’t look now but he is right behind you. Boo!

        Dean

  • Richard

    Voluntary Homelessness
    I have to agree, with my benefits running out in January and no job I will end voluntary going homeless. Actually I do not have e enough money for a proper relocation So I have to sell averting I have then buy a one way ticket out, and take me and two seabags, and my computer anywhere in the world to find a job.

    • Anonymous

      You know Richard, my business is in an area of 15% plus unemployment. In the last six months, I have had two (2) people apply for a job. Yes this is a minimum wage job, it is not the type of business than can pay higher wages, especially now that minimum wage is so high. That has taken out our choice to pay our deserving employees better wages because we have to give it to others.

      That said A lot of people believe this type of a job is beneath them. Personally, if I were in your shoes, I would think $8.40 per hour was a lot better than $0.00. Sure you can’t live in the manner in which you have become accustomed, but then things aren’t going to get any better.

      This is an employers market and even for crummy wages employers can be choosy. Just go show them you have something the high school dropouts don’t have.

  • John in Oregon

    You make a good point Larry. My observation is its much worse than even your numbers show.

    I recently saw some comments from a veteran small mergers-and-acquisitions specialist. He was commenting on the national situation so expect things to be worse here in Oregon. He put the quick rundown of the status of his clientele in 5 bullet points

    1. Their businesses are down 10, 20% or more.

    2. They have either laid off staff or have reduced hours to 4-day weeks trying to keep key staff.

    3. They have reduced their own salaries and in many cases have implemented “cross the board” salary reductions.

    4. They (for the first time in their lives) have no ability to forecast beyond 4 weeks.

    5. They see nothing good on the horizon that would benefit them re: sales, cost reduction, efficiency, etc.

    Note points 2 and 3. Shortened work weeks and reduced compensation are a form of job loss that will never show in the statistics. Nothing about the remaining points suggests any improvement soon.

    The experience of several of the vendors I work with is insightful. They are beating the bushes for every scrap of work they can find. And looking for any innovative solution possible.

    One contractor does time and materials work. In the past he bought materials at contractor discount making a profit from the difference between discount and list.

    No more. The state revenue tax killed that income. For each $100,000 of material sales Oregon takes an $8,000 bite. My contractor still owes $95.000 to the materials supplier dumping a $3,000 loss in the Contractors lap. And he can’t tack that $3,000 loss on top of the materials list price.

    Keep in mind that Oregon is also taking a $7,600 bite out of the suppliers hide as well.

    My contractor is now taking a different approach. Billing the materials cost directly to the client. He doesn’t owe the state for revenue he doesn’t get. And it might get him one or two additional marginal jobs.

    The business environment is really dismal, and the politicos don’t care.

    As the mergers-and-acquisitions specialist concluded.

    “Any future seller prospects that I encounter, I will urge them to continue operating their business and take from the business everything that they can legally do for as long as they can. They are far better off. It is quite likely that I will have to revisit some of my existing clients and tell them the same thing… something that I dread.”

    “I am so outraged as to what is happening to our country. This is no longer a political issue [because] we will all lose. We are all casualties of the new paradigm. There will be many more as we continue into a morass that will take generations to recover, if we can. Be it “Cap and Trade”; government-run health care; TARP; bailouts; “stimulus”; business takeovers, etc.; our future is being controlled by bureaucrats and politicians who never, ever, ever ran a business and knew the “gut-check” of filling out and paying their 941’s”.

    that’s astonishing advice for a small business owner that wants to sell and retire. Being told to milk it for all he can and then put it down.

  • Dave A.

    Speaking just for myself, I am liquidating my business over the next 90 days after 20 years in Oregon. My income is barely above expenses at this point; and if it wasn’t for planty of investment income I would have closed 3 or 4 months ago. My wife and I are leaving the state and that alone will save us 16-18K in taxes. It is very doubtful we will ever come back to live here again. Anyone who says Portland is a good place to open a business obviously is a politician or has never owned a business in Portland.
    I see lots of empty storefronts everywhere I go in this state; and don’t see that situation improving anytime soon. I predict this state will be in the same shape as California in a few years if the same batch of idiots in Salem continue to try to tax anything that moves or might be a source of income.

  • Joe

    Dave is right. We are almost there as far as being in as bad a shape as CA. There are only 48 states doing better than we are.
    What a bunch of total toons.

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