Arizona economist Aruna Murthy [Ross D. Franklin/AP]

Ross D. Franklin/AP

The state's jobless rate dropped four-tenths of a point in April, the biggest month-over-month decline in decades and the first time the rate has been less than 7 percent since 2008.

But there may be less to the numbers than meets the eye.

It starts with the fact that job growth from March to April was just 4,300 — and just 3,200 in private industry — a rate that Aruna Murthy, director of economic analysis for the state Department of Administration, called “mediocre.”

In fact, that's less than half of the April job gains Arizona was posting right after the recession ended.

Then there's the pure math that leads to the seasonally adjusted unemployment rate of 6.9 percent: Unemployed divided into the total labor force. And while the total number working did increase, more than 35,000 Arizonans dropped out of the labor force, people who simply stopped looking for work.

The other thing to look at is where the jobs are — and are not — being created.

This past month, the biggest chunk of those 3,200 new private sector jobs was among workers in bars and restaurants.

“They're not necessarily the very high-paying jobs,” Murthy conceded of the 1,500 new slots. “But it is certainly saving Arizona's economy in terms of having some jobs, even if they are low paying.”

At the other end of the pay spectrum, the state continued to shed jobs in manufacturing, dropping by another 100 in April. Once again that was led by the state's defense-dependent aerospace industry as well as firms that make computers, chips and other electronic parts.

The state's construction industry also continues to struggle to show signs of life, losing 1,100 jobs last month.

Murthy said these were largely in specialty trades, things like plumbers, drywall hangars and electricians. She said it may indicate that some of the jobs they were working on are nearing completion but there are few new projects replacing them.

There were other segments of the economy that have continued to grow.

Murthy found an increase in hiring by insurance companies.

Some of that could be related to national firms moving operations here, and Murthy said total employment increase of 800 in the state's financial services sector posted their largest month-over-month gain since 1990.

Health care, which never really suffered in Arizona during the recession, added another 1,200 jobs.

Murthy also noted an increase of 1,000 jobs in employment services.

But she said that's not necessarily a very positive sign, as it reflects those working for companies that provide temporary help to other types of firms. Murthy said that may indicate these larger firms are not yet confident enough in a recovery to actually put new employees on their own payrolls.

Overall, though, Murthy said she remains optimistic. She said jobs continued to be added, even if the pace of employment growth remains “lousy.”


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