Full Jobs Recovery and Expansion in Oregon: 2022 Year in Review
February 14, 2023Oregon employers added 81,300 jobs to nonfarm payrolls in 2022. Those gains completed the jobs recovery from the pandemic recession, and expanded employment in Oregon to a new, record-high level. Strong job gains helped to keep Oregon’s unemployment rate near historic lows in 2022.
Although employment reached a new level overall, jobs were spread differently across Oregon’s economy. Some sectors reached new highs, while others struggled to either regain jobs lost in the recession, or to maintain employment gains of the past two years.
Beyond Pre-Pandemic Employment
Oregon started the year with 1,917,300 jobs, which was 54,900 jobs below the pre-recession peak in February 2020. By December 2022, Oregon employers had expanded their payrolls to 1,993,500 jobs. That was 21,300 more nonfarm payroll jobs than before the recession, and a new all-time high in Oregon.
Oregon reached full jobs recovery in August 2022, less than 2.5 years (30 months) after the onset of the pandemic recession. That’s a relatively fast rebound: it took Oregon more than 6.5 years (82 months) to fully regain the jobs lost in the Great Recession, and more than four years to recover from the dot.com bust of the early 2000s.
Sectors that expanded into new territory in 2022 included construction; private education services; trade, transportation, and utilities; and professional and business services.
Expanding Sectors
Construction had 122,700 jobs in December 2022. Over the year, gains were relatively strong in all main components of the construction sector. On an unadjusted basis, specialty trade contractors – companies doing the plumbing, electrical, roofing, in buildings or other types of construction – added 7,500 jobs in 2022. Residential building construction grew by 1,200 jobs. Both nonresidential builders and heavy and civil engineering construction had lagged in jobs recovery in 2020 and 2021, but picked up payroll gains over the past year. They each added 800 jobs between December 2021 and December 2022.
Private education services was among the hardest-hit sectors during the pandemic recession. It includes privately owned K-12 and higher education, private technical and trade schools, sports and recreation instruction, and educational support services. These entities began to rebound in early 2021. By December 2022, they had 1,300 more jobs than in February 2020.
Expanding Sectors with Some Underlying Losses
Trade, transportation, and utilities also closed out 2022 matching its record-high number of jobs, at 367,200. The sector reached this level in June, and again in December, with some slight losses in between. Trends varied among the different areas of this broad sector. The wholesale trade component had strong gains over the year. Transportation, warehousing, and utilities flattened out during 2022, after rapid growth in 2020 and 2021. Retail trade actually saw a slight decline in employment during 2022.
Professional and business services also reached a new peak level of employment in December 2022, with 267,800 jobs. The administrative and waste services component of the sector – which includes temp help services, janitorial and landscaping services, and waste collection, among others – also finished 2022 at a new employment high.
The management of companies component of professional and business services includes corporate headquarters. After more than a year of sluggish growth following the pandemic recession, payroll job gains resumed in 2022. Management of companies finished 2022 having essentially regained all its recession job losses. Professional and technical services hit a new peak jobs level in July 2022 at 111,600, but dropped slightly to 111,200 by December.
Oregon’s manufacturing sector fully recovered its pandemic recession job losses as of July 2022. By December, Oregon manufacturers had 199,600 jobs, which was 8,600 more than in February 2020. This was remarkable, because manufacturing – and durable goods in particular – has not fully recovered the job losses from any recession since at least 1990. While durable goods manufacturing has expanded to have 3,400 more jobs than before the pandemic recession, in December 2022 it still had 32,400 fewer jobs than the all-time high of 171,000 recorded in February 1998.
Lagging Sectors
Some sectors of Oregon’s economy continued struggling to regain their pandemic recession job losses. They include leisure and hospitality, other services, and local government.
Leisure and hospitality added 16,900 jobs between December 2021 and December 2022, the most of any sector. Still, with an employment level of 208,500 jobs in December 2022, Oregon’s hotels, restaurants, bars, and entertainment venues were still 8,000 (-3.7%) below February 2020 job levels.
The other services sector includes a mix of automotive and other equipment repair, and social and grantmaking organizations, along with other miscellaneous services. These employers had 62,300 jobs as of December 2022. That was 1,700 more jobs than one year prior, but still 3,300 jobs (or -5.0%) lower than the sector’s pre-recession peak.
Roughly half of all local government jobs in Oregon are found in either public K-12 or public higher education. Over the past couple of years, trends in local government education have been a driver of overall local government employment. Local government has experienced uneven gains in 2021 and 2022, but generally been trending upwards. After adding 13,100 jobs between December 2021 and December 2022, local government ended the year 2,000 jobs away from full recovery.
More Jobs, Low Unemployment
Oregon’s unemployment rate was at or below 4.5% throughout 2022. That’s relatively low, and relatively uncommon. Since 1976, Oregon’s unemployment rate has only been at or below 4.5% three times: January and February of 1995; from October 2016 through March 2020; and from September 2021 through at least December 2022.
Oregon’s unemployment rate hit its low point for the year, at 3.5%, in June and July. This happened amid labor force growth, and greater labor force participation. Oregon’s labor force reached a new high in July, with 2,205,000 Oregonians ages 16 or older either working, or unemployed but actively looking for a job in the past four weeks, and available and able to take a job if offered to them. Throughout 2022, Oregon’s labor force participation – the share of the total population ages 16 or older in the labor force – was at its highest rate in a decade.
Strong Start for 2023
Oregon has seen at least one early sign of potential labor market softening. Labor force growth leveled off mid-year, then dropped slightly (-11,000) between July and September. After reaching a post-recession low of 76,500 in July, the number of unemployed people in Oregon also rose (+22,500) by December. In the second half of 2022, Oregon’s unemployment rate rose by 1 full percentage point, from 3.5% to 4.5%.
Yet, Oregon has continued to add jobs, first-time and ongoing claims for unemployment insurance benefits remained low, and unemployment remained in relatively low territory. Oregon employers also still had far more job openings in fall 2022 than before the pandemic recession. Despite labor force growth slowing, overall labor market conditions look strong at the outset of 2023.