Hourly Update

Jobless rate down, wages up in Arizona

PHOENIX — A continuing slide in the state's jobless rate is translating to fatter paychecks for workers — particularly those with needed skills. New figures from the Department of Economic Security show the state's seasonally adjusted unemployment rate at 3.4 percent for June. That's down 0.2 points from May — and a 0.8 point drop from a year earlier. Don Wehbey, senior economist for DES, said that 3.4 percent figure essentially is full employment. That means anyone with any skills at all can pretty much find a job without too much effort. Conversely, it means that companies looking for workers are finding it harder to attract them. And what they're offering as bait, Wehbey said, is money. "They are anteing up, I guess you could say, for the talent, to either attract or to keep," he said. "It's a competitive market among firms to keep — or steal — or attract however they can that good talent that they need in order to be highly productive and profitable for their industry." Wehbey said all that is translating to wage inflation. He said figures for the last quarter of 2006 — the most recent available -- show annual wage growth is averaging between 9 and 12 percent. Complicating the situation for Arizona businesses is that the same forces which have resulted in the state having the fastest population also are attracting new firms. "And those businesses that are here are competing for that workforce," Wehbey said. "If they can't find them here, they're going to have to bring them from somewhere else," he continued. "And they're going to have to step up to compete for that." The employment market remains even tighter in the state's two metropolitan areas. In the Phoenix area the rate stayed at 2.9 percent; Tucson saw no change in its 3.3 percent jobless figure. While the overall jobless rate is down, the situation is not the same across the entire economy. Construction employment remains weak, losing 600 jobs compared with May. There also were job losses in retail trade. But Wehbey said mining employment rose "due to strong world demand for copper."