This installment of Orlando’s quarterly economic update takes a deep dive into how many jobs have been lost since the beginning of the pandemic, if we can expect change in the coming months, and examines the broader economic impacts revealed from new, key, data sources.
Net Job Loss
The job report released by the Florida Department of Economic Opportunity on July 17 rounded out employment data for the second quarter. The majority of Orlando’s job loss so far in 2020 have taken place in quarter two, with 203,300 jobs lost since the beginning of the recession in February. See Figure 1 below. Most of these losses have been in the leisure and hospitality industry. See Figure 2 below. While no industry in Orlando has returned to pre-recession levels of employment, July data revealed job gains in Leisure and Hospitality (+29,200), Retail Trade (+6,800) and Professional and Business Services (+1,500). Government (-10,700) and Education and Health Services (-900) lost jobs from May to June.
Signals of Continued Job Loss
Orlando’s unemployment rate decreased to 16.5 percent with the release of July’s data, down from record highs of 21.1 percent (revised). This follows the National trend, where the unemployment rate decreased to 11.1 percent in June. View the unemployment rates for each county in the Orlando Metropolitan Statistical Area (MSA) in the Orlando Market Leading Indicators deck, updated weekly.
However, it is possible that the true unemployment rate at the end of quarter 2 is higher than this data shows. Advanced data released by the Dept. of Labor reveals that initial claims for unemployment insurance almost doubled previous weekly levels in Florida. For the week ending July 11, initial claims filed during the week increased to 129,408, up from almost half that number, 66,941, the previous week. This is the sharpest, single week increase seen since mid-April. See Figure 3 below.
This spike in unemployment insurance claims is likely due to a new round of closures and layoffs, associated with Florida’s recent spike in coronavirus cases. The unemployment insurance claims number is a leading indicator of how companies and the labor market are reacting to spikes in case numbers. As companies re-close or move forward with more permanent layoffs, expect to see this number increase in the coming weeks.
Another metric signaling continued job losses, the number of people in the U.S. claiming to be on permanent layoff, increased to 2.9 million in June’s employment report, even while the unemployment rate declined. “The number of unemployed persons who were on temporary layoff decreased by 4.8 million in June to 10.6 million, following a decline of 2.7 million in May.The number of permanent job losers continued to rise, increasing by 588,000 to 2.9 million in June.” Jobs lost at this point during the pandemic will be harder to replace farther into recovery and more permanent job losses signal the likelihood of a longer recession.
Broader Economic Impacts
New data tools created by the U.S. Census Bureau and Brookings Metropolitan Policy Program highlight metrics beyond just those connected to the labor market.
The first worth highlighting is the Census Bureau’s new Small Business Pulse Survey. With data available from the end of April through the end of June, this survey was designed to capture the challenges facing small businesses and inform policy responses. Since April, there has been a decrease in the percentage of Orlando small businesses reporting a large or moderate negative effect on the business from the COVID-19 Pandemic, decreasing from 92 percent of small businesses to 88 percent.
As of the final week in the second quarter, 44 percent of Orlando’s surveyed, small businesses reported that they believed it would take more than six months for business operations to return to normal levels from one year ago. This is an increase of 10 percentage points from the beginning of the survey. Interact with this data and view responses to other questions here.
Lastly, the Brookings Metro Recovery Index highlights other leading indicators to track Orlando’s recovery performance over the last few months. This tool shows that Orlando’s real estate market has been the least impacted among other large metros, with active listings down only 14 percent since the start of the pandemic, ranking Orlando third behind Miami and Las Vegas. However, these same metros have some of the highest unemployment rates and drops in the number of active job postings in the same time frame. This dichotomy reveals how this recession is playing out differently on regional economies and impacting distinct groups of workers disproportionately. As noted in a recent article by the Wall Street Journal, “historically low interest rates are luring in auto and home buyers, many of whom have higher incomes and firmer job security than low-wage, service-sector workers hardest-hit during the recession.”
Other Items of Note that Happened in Q2 2020
- Black Lives Matter protestors occupied the streets of Downtown Orlando for multiple weeks after the killing of George Floyd in Minneapolis on May 25. The incident reenergized conversations about reducing racial inequities in the U.S. and Orlando, colliding with greater understanding about the disproportionate impacts the pandemic has had on Black workers and families.
- Cybersecurity firm GLESEC moved its headquarters to Orlando from Princeton, New Jersey and gov-tech innovation leader GCR chose Orlando for its Center of Excellence.
- The Orlando Tech Council, in alliance with the University of Central Florida, launched the new Orlando Tech Connect program designed to create a scalable process for matching enterprise company needs with local company skill sets.
