Payroll Employment in the Rogue Valley: Year End Review 2016

by Guy Tauer

January 31, 2017

Another lap around the sun was completed just a few weeks ago, so let’s take this moment to reflect back on the year that was 2016 from a job change perspective. Jackson County enjoyed its fifth consecutive year of payroll employment growth. Momentum has been gaining the past three years. Job growth rates increased from 2.3 percent in 2014 to 3.1 percent in 2015, and were even stronger in 2016 with a 3.5 percent increase in nonfarm employment.
Josephine County saw payroll employment gains in five of the past six years. In a bit of a contrast to Jackson County, Josephine’s job growth momentum appears to be slightly waning since 2014, when the growth rate hit its recent peak of 4.3 percent in 2014. In 2015 Josephine employment growth fell to 3.2 percent, a healthy but slower increase. In 2016, job counts were still growing, but at a 2.4 percent pace on an annual average basis.

Jackson County Trends

Now let’s take a look at job change by industry to dig deeper into Jackson’s 3.5 percent and Josephine’s 2.4 percent rise in nonfarm payroll employment in 2016. Jackson County added 2,880 payroll jobs in the past year. Over one-half of Jackson County’s total increase came from three industries: private education and health services; leisure and hospitality; and construction. Local government employment rose by nearly 400, mostly due to increases in local education. Retail trade employment rose by 370 jobs, no doubt bolstered due to the opening of a number of new retail establishments at the Northgate Marketplace in Medford.

Manufacturing gained 250 jobs on an annual average basis. Looking at more detailed quarterly data through September shows employment increases in wood products, chemical and transportation equipment manufacturing contributing to the overall rise in these “traded-sector” jobs. Food manufacturing, a perennially gaining industry since the end of the recession, finally gave up some of those gains through September 2016. Other services added 200 jobs between 2015 and 2016. One of Oregon’s new businesses, marijuana dispensaries, was included in other services through 2016, so a portion of the increase in other services is likely due to this nascent Oregon industry.
Financial activities; transportation warehousing and utilities; and wholesale trade all saw modest gains in 2016. Only a few industries saw job losses in 2016. Information and federal government were just slightly down for the year. The largest decline occurred in  professional and business services, losing 100 jobs since 2015.

Josephine County Trends

Josephine County added 600 nonfarm payroll jobs in 2016, a growth rate of 2.4 percent. Just over one-third of the increase occurred in the private education and health services industry. AllCare Health’s new 45,000-square-foot office space will likely contribute to future expansion of the county’s health services industry, along with a growing and aging population.

Retail trade added 170 jobs in 2016. The re-opening of the Grants Pass Albertson’s and the new Winco grocery store helped boost retail trade totals last year.

Leisure and hospitality employment rose by 160 from 2015 to 2016. More growth is likely in the coming months in the accommodations industry with the published announcements of a new Hampton Inn and the newly proposed Lodge at the Riverside in Grants Pass. A Red Robin restaurant and a new In-and-Out restaurant all moving toward opening in the near future will boost food services employment in Josephine County. Tourism and travel spending has been growing steadily. An improving job market and rising incomes are creating more demand for travel and leisure spending. With fuel costs remaining low, this should help with continued travel and growth in the leisure and hospitality industry in Josephine County. Abundant run-off from our ample snowpack will benefit rafting and jet boat businesses along the Rogue River this coming summer.
Construction and financial activities both saw modest employment gains in 2016, up by 70 and 60 jobs, respectively. Turning to a couple industries that lost jobs in 2016, manufacturing and wholesale trade both shed 60 jobs last year. The loss in manufacturing was mainly due to losses in wood product manufacturing. The published closure of the Rough and Ready lumber mill in Cave Junction was a factor in the loss of wood products employment in 2016.

Overall it was a solid year of job growth in the Rogue Valley, and the longer-term job growth trend has finally erased or nearly erased the deep job losses spurned by the Great Recession in both Jackson and Josephine counties. Going forward, no one knows for sure if the expansion will continue its current pace. Now tight labor markets with unemployment rates near historic lows will likely be a challenge for businesses looking to expand and grow going forward. Low vacancy rates, and rising home and rental prices will also put pressure on our comparative advantage to other regions of the country. This can add to the challenge in efforts to recruit new companies and grow existing businesses in the Rogue Valley in the coming year.

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