Austin jobs continue to grow at an impressive rate. The Austin Chamber’s latest monthly job growth and unemployment statistics reveal some fascinating numbers surrounding that growth.
During the past year, the Austin area added more than 25,000 new jobs, an increase of 2.4%. Austin’s unemployment rate is also down. In May 2018, reports the Austin Chamber, Austin’s number of unemployed was 32,149. Over the past 12 months, the number of unemployed declined by 5,183 or about 16%, to 26,966.
Why is that fascinating?
“The last time Austin saw fewer than 30,000 unemployed was during a few months in 2007. Today’s labor force is about 44% larger than it was in 2007,” Beverly Kerr, Vice President of Research with the Austin Chamber’s Economic Development Department, pointed out earlier this year.
In short, while Austin’s population of job candidates has increased substantially (yet again), Austin jobs have grown at an even faster pace. Talk about a mixed bag for employers feeling the pinch on recruiting top talent.
WHICH AUSTIN JOBS AND INDUSTRIES ARE BOOMING?
The private sector has contributed the most to Austin job growth by adding 24,900 jobs over the past year. While all private sector divisions have added jobs in Austin, professional and business services have contributed the most. Wholesale trade is the fastest growing, with information, construction and natural resources, and financial activities not far behind.
Previous data released this past spring attributes some of the most impressive job numbers in Austin to science, technology, engineering, and math (STEM) occupations. STEM occupations account for 11.1% of all Austin jobs, which is nearly double the national average. Austin’s two largest STEM occupations are applications software developers (13,520 jobs) and sales representatives for technical and scientific products (10,010 jobs). And as far as employers go, size doesn’t necessarily matter. Startups account for a larger share of businesses in Austin than in nearly all other major U.S. metros.
To further illustrate Austin’s STEM-heavy concentration, the Austin Chamber identifies the following key industries as their top areas to watch: advanced manufacturing, clean technology, data management, space technology, creative and digital media technology, and life sciences. Apple, Resideo Technologies, The Zebra, and the U.S. Army’s Futures Command are just a few STEM organizations that have moved to or expanded their Austin workforces recently. (For more details, check out our latest roundup of companies moving to Texas.)
WHAT ABOUT THE REST OF TEXAS?
Statewide, Texas jobs are also growing at a rate that exceeds labor force growth. While Austin is the 11th fastest growing metro area according to U.S. Bureau of Labor Statistics, the Dallas metro ranks an impressive 2nd place on the list and Houston—the largest metro in a top spot—holds steady at 7th place (San Antonio and Fort Worth rank 22nd and 25th).
Industry sectors contributing to this growth across Texas is similar to Austin’s own job growth with one key difference: Statewide, information, and retail trade jobs declined. The one area in which Texas outpaces Austin on job growth is in the leisure and hospitality sector. According to the Dallas Morning News, the sector has been growing consistently statewide since 2010. And in Texas A&M University’s latest review of the Texas economy, the mining and logging industry ranked first in job creation followed by construction, other services, leisure and hospitality, manufacturing, financial activities, and professional and business services.
Unemployment is also keeping up at a remarkable rate throughout Texas.
“Our economy is thriving across multiple industries, attracting new companies every day, showing that Texas is the best state in the nation to do business,” Texas Workforce Commission’s Ruth R. Hughs recently stated. “Today, I am especially proud to be a Texan. Our historically low unemployment rate is excellent news for Texas workers.”
HOW DOES JOB GROWTH AFFECT EMPLOYERS?
When job growth outpaces an already booming population growth, which employers struggle the most? It depends. Low paying blue-collar jobs can be the first to suffer when wages and benefits don’t keep pace with other factors, like lower interest in those types of jobs and a rising cost of living.
“Our wages have crept up about 20 percent over the last two years,” Delfo Trombetta recently told KUT. Trombetta is president of the restaurant management group New Waterloo Hospitality, which manages about 1,000 employees for Austin establishments like Sway and La Condesa, “I wish I could say we could raise our prices 20 percent, but the market’s not as elastic as we’d like it to be.”
And then there’s the skilled labor workforce, which is necessary for many of the state’s top performing industries to stay strong (including wholesale trade, construction, manufacturing, and mining and logging). According to a joint study by Deloitte and The Manufacturing Institute, the skills gap in these areas may leave an estimated 2.4 million positions unfilled nationwide by 2028.
Many manufacturers surveyed say these jobs are already taking longer to fill, during which time they’re missing key workers to deliver open orders, expand production, or respond to customer needs. Skilled production workers including welders and machinists now take an average of 93 days to recruit and hire, while engineers, researchers, scientists, and other specialized professionals take 118 days—or nearly four months—to find.
Increased competition for workers exposes all employers’ weaknesses, no matter what job levels they’re recruiting—entry to executive, blue collar to white collar. Organizations that don’t pivot to meet these challenges lose out on top talent. To stay ahead of the curve, take a look at our previous advice on four new rules of recruiting, which include paying attention to culture fit and reducing time-to-hire.
For a closer look at the state of Austin jobs, you can access the Austin Chamber’s analysis here. And for a closer look at labor shortages throughout Austin and Texas, read this recent article from our blog. Finally, if the great news about job growth booming across the state has you nervous, contact us. A staffing partner or recruiting firm could be exactly what you need to compete for talent in this heated environment.