Idaho’s Economy Experiencing Rapid Growth
Every two years, the Idaho Department of Labor releases 10-year-projections of what Idaho’s economy may look like. After years of sluggish economic growth the department’s most recent projections indicate that Idaho’s economy may finally be heating up. From 2012 to 2022 Idaho payroll jobs are projected to grow 16.3 percent – 1.5 percent annually – and add more than 109,000 jobs to the economy. While 16 percent growth would be excellent news for the state’s economy, Idaho’s economy appears to be well ahead of schedule and on track to significantly outpace the national economy.
Another positive sign in Idaho’s current expansion is that the growth has been distributed throughout several sectors of the economy. With two years removed from the latest projections, 12 industries in Idaho have posted higher-than-expected growth rates. Health care and social assistance reported the largest net growth adding 6,764 jobs – 2,800 more than projected growth – followed by leisure and hospitality adding 4,749 – 2,060 more than projected growth – and construction at 4,332 – 2,100 more than projected growth. Eight industries performed below expectations, four of which experienced losses.
For Idaho to maintain the projected growth of 16.3 percent two years into the projections, Idaho would need to add approximately 20,000 jobs to the economy. Data released by the U.S. Bureau of Labor Statistics shows that by the end of 2014, annual employment in Idaho reached 646,600. Over the past two years, Idaho has seen annual job growth of 2.6 percent, adding more than 32,000 jobs to the economy. This places Idaho more than one full percentage point above the projected annualized growth rate and nearly 12,000 jobs ahead of schedule. While the goods producing sector saw the fastest growth at 7.5 percent, the service providing sector accounted for nearly three of every four jobs added to the economy since 2012.
As Idaho’s economy has expanded, the faster-than-expected growth has been felt nearly state wide. Although southwestern Idaho saw the fastest growth of 5.9 percent, the growth in northern Idaho is arguably the most significant. In the Idaho Labor regional projections, by the end of 2014 total employment in northern Idaho was projected to increase 2.1 percent. Thanks to significant growth in construction at16.6 percent and health care at 11.6 percent, northern Idaho posted total job growth of 5.4 percent, more than three percentage points above the region’s projected growth rate. In total, five regions in Idaho posted higher-than-expected growth rates. Southeastern Idaho’s growth of 2.3 percent was four tenths of a percent below the region’s projected growth of 2.7 percent.
Parallel with the state’s rapid job growth, Idaho has also seen significant wage growth. Since 2012, Idaho’s average wage increased from $36,150, to $37,970 by 2014. Based on the most recent annual Quarterly Census of Employment and Wages data, last year Idaho’s average wage grew 3.1 percent, marking the largest one-year increase since 2006 at the height of the housing bubble which sent the national economy into recession the following year.
Since 2012, nine industries in Idaho reported wage growth at or above the state’s average growth, while 10 industries were below. Manufacturing and real estate sectors saw the largest growth at 15.7 percent and 12.4 percent.
Coupled with the rapid growth in both jobs and wages, Idaho’s impressive economic expansion shows no signs of slowing down. The latest labor market data published by the Bureau of Labor Statistics shows that in 2015, Idaho’s annual labor force grew by 19,000, while annual employment increased by 24,500. Furthermore, the BLS recently reported that Idaho’s 4.4 percent over-the-year growth of seasonally adjusted nonfarm jobs in December was not only the state’s largest gain since 2005, but the nation’s fastest growing state for the third consecutive month. As a result, Idaho’s tight labor market pushed the state’s average unemployment rate in 2015 down to 4.0 percent – more than a full percentage point below the national average.
The broad growth across several sectors in Idaho’s economy, and the equally distributed wage growth, have laid the foundation for continued success in coming years. As the current expansion continues, Idaho will become an increasingly attractive destination for both job seekers and employers looking to take advantage of the many opportunities the state’s economy will provide.