THE ECONOMY: Mass. job growth was 4 times greater than estimates
Massachusetts added nearly 40,000 jobs in 2011, four times the revised employment estimates reported earlier this year by federal officials, according to an analysis of newly released data by the University of Massachusetts.
The new data, a census of Massachusetts employers compiled by the US Labor Department, offers the most complete and reliable snapshot of the state’s labor markets. It showed that the state created jobs at about the same pace as the nation last year.
“I guess we’re in middle of the pack in terms of job growth,” said Alan Clayton-Matthews, an economist at Northeastern University. “I wouldn’t jump for joy over the performance in 2011, but I wouldn’t be dismayed about it either.”
The analysis was published Thursday in the UMass economic journal MassBenchmarks. Earlier this year, the Labor Department dramatically lowered estimates of the state’s job gains in 2011 to just 9,100 — a figure that many local economists doubted because other indicators, such as tax collections, suggested much stronger growth.
Information from that census only becomes available months later, and neither the third- nor the fourth-quarter data were available when the Labor Department did its 2011 revisions in the beginning of the year. After the third-quarter data were released in April and UMass did a similar analysis, Labor Department officials acknowledged their revisions were probably wrong.Those revisions were based on incomplete data for 2011. The Labor Department first estimates job growth based on a monthly survey of employers, which can have a wide margin of error. It later reconciles those estimates with payroll data from a census of employers in the state unemployment insurance system.
They will use the additional information to further revise the 2011 figures next year.
The latest data are from the fourth-quarter census of employers. It showed the state economy
slowed during that period, shedding 3,000 jobs, according to the UMass analysis. Those losses were more than offset by gains of about 26,000 jobs in the third quarter.
Overall, Massachusetts’ job growth rate was 1.2 percent last year, compared with 1.4 percent nationally.
“The data tells us it has been a really steady recovery instead of a sluggish one in Massachusetts,” said Martin Romitti, managing editor of MassBenchmarks and an economist at the UMass Donahue Institute. “It’s been a steady climb, but everybody’s worried about what’s ahead as well.”
Those worries include the economic crisis in Europe, which threatens to pull the global economy into recession, and a stalemate in Congress that could lead to big budget cuts and tax increases that could derail the US recovery.
Romitti said job growth in 2012 may not be as solid as last year’s, particularly if national or global economies continue to slow. Massachusetts is particularly vulnerable to the economic crisis in Europe because about 40 percent of the state’s foreign exports are sold there.