Prescott MSA August 2023 Summary

Aug. 4, 2023

By Delaney O’Kray-Murphy, EBRC research economist

Solid gains in jobs offset by increase in labor force

Exhibit 1 presents current Prescott MSA economic indicators.

In June 2023 (seasonally adjusted), the civilian labor force in the Prescott MSA grew by 1.9% over the year, reaching 109,539. The labor force fell slightly short of its peak in May but showed the same healthy growth observed throughout 2023, with monthly year-over-year changes ranging from 1.8%-2.3%.

In June 2023, resident employment in the Prescott MSA experienced a similar trend, showing a 1.1% seasonally adjusted increase over the year to reach 105,800. In 2023, all months posted solid employment gains, with the year-over-year increases ranging from 1.1%-2.2%.

Despite the solid gains in both employment and the civilian labor force, the unemployment rate in the Prescott MSA has increased over the year, reaching 3.5% in June, a 0.7 percentage point increase from a year ago. Importantly, these increases do not necessarily indicate a real problem with the overall job market; they may instead reflect the low unemployment rates in 2022. For context, the unemployment rates in the U.S. and Arizona hit 3.6% and 3.5% in June, respectively.

Non-seasonally adjusted average hourly earnings have slightly declined throughout the course of 2023, with January presenting a figure of $26.54, a 6.2% increase over last January, and June falling to $25.36, a 2.5% decline from the same period in 2022. The June hourly rate translates to an annual salary of approximately $50,720.

Total nonfarm jobs have shown steady improvement over the year throughout 2023. In June, the number of seasonally adjusted jobs hit 69,300, a 2.4% growth over the year. In comparison, Arizona gained 65,500 to reach 3,157,200 jobs in June, a 2.1% increase, and the U.S. gained 209,000 jobs to hit 156,204,000, a 2.5% increase over the year.

Federal government has shown the most significant percentage gain over the year, coming in at a 12.5% increase from the same period last year, while manufacturing suffered the worst losses, diminishing by 2.5%. Other gains occurred in Private Education and Health Services (7.8%), Other Services (4.2%), Government (3.1%), Mining, Logging, and Construction (1.4%), and State and Local Government (1.2%). Trade, Transportation, and Utilities and Leisure and Hospitality both saw losses of 2.2% and 1.9%, respectively. The remaining sectors: Information, Financial Activities, and Professional and Business Services experienced no changes over the year.

Retail sales this year fluctuated downwards in February and March but have shown strong growth in April and May. Retail sales less food and gasoline hit $265.6 million in May, showing an 8.1% increase over the year. January and April also saw growth over the year, coming in at 3.8% and 2.3%, respectively. March saw the worst decline, sinking 5.8% over the year, while February only showed a slight 1.2% decline.

Residential housing permits in the Prescott MSA have slumped in 2023. While April broke the negative trend for total units, coming in at 241 and showing a 113.3% over-the-year increase, each other month has shown declines in both single-family and total permits issued. In June 2023, total permits came in at 106, a 24.3% decrease over the year. Of these permits, 100 were for single-family homes, representing a 25.4% slump over the year.