economy at a glance - mississippibegins, in mississippi uncertainty about future growth re- mains,...
TRANSCRIPT
T he Mississippi Leading Index (MLI) was essentially flat
in November, edging lower by 0.05 percent as Figure
1 below indicates. Compared to November 2013, the MLI
was 6.5 percent higher.
As Figure 2 below indicates, the value of the Mississippi
Coincident Index increased by 0.1 percent in November.
Following data revisions, this increase was essentially the
first change in the Index since July. Compared to one year
ago, the value of the index was 1.0 percent higher in No-
vember.
The U.S. Bureau of Economic Analysis’ (BEA) third esti-
mate of real U.S. gross domestic product (GDP) for the
third quarter indicates real GDP grew 5.0 percent from
July to September, an increase from its second estimate of
4.6 percent. The 5.0 percent rise in third quarter real
GDP was the largest since the third quarter of 2003. Giv-
en the contraction in real GDP in the first quarter and
what it expects will be a slower rate of growth in the
fourth quarter, the Federal Reserve believes real GDP
grew 2.3 to 2.4 percent for all of 2014, a slight improve-
ment from 2013.
These and other data—such as the University of Michigan
Index of Consumer Expectations, which reached its high-
est level in almost eight years in December—signal the
U.S. economy is likely strengthening. However, in Missis-
sippi, data indicate weakness remains in the state’s econo-
my, as the state was one of only two states to lose jobs
over the past twelve months (see page 8). While the na-
tional economy appears to be picking up steam as 2015
begins, in Mississippi uncertainty about future growth re-
mains, particularly with regard to employment prospects.
Corey Miller, Economic Analyst • 3825 Ridgewood Road, Jackson, MS 39211 • [email protected] • www.mississippi.edu/urc
Mississippi Leading Index, November 2014 2
Mississippi Coincident Index, November 2014 4
National Trends 5
Mississippi Employment Trends 8
Fiscal Disparities Across States 10
Inside this issue:
To download the current issue of Mississippi’s Business as
well as view an archive of past issues, visit:
www.mississippi.edu/urc/publications.asp
Sources: University Research Center and The Conference Board Sources: Federal Reserve Bank of Philadelphia and The Conference Board
94.0
96.0
98.0
100.0
102.0
104.0
106.0
108.0
110.0
11/1312/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/1411/14
Figure 1. Leading indices
Mississippi U.S.
104.0
105.0
106.0
107.0
108.0
109.0
110.0
111.0
112.0
11/1312/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/1411/14
Figure 2. Coincident indices
Mississippi U.S.
ECONOMY AT A GLANCE
VOLUME 73, NUMBER 1
JANUARY 2015
A Publ icat ion of the Univers i ty Research Center , Miss i ss ipp i Inst i tut ions of Higher Learn ing
MISSISSIPPI ’S BUSINESS
Notes: The Mississippi Coincident Index is constructed by the Federal Reserve Bank of Philadelphia and re-indexed to 2004. The Index is based on changes in nonfarm employment, the unemployment rate, average manufacturing workweek length, and wage and salary disbursements. The Mississippi Leading Index is constructed by the Mississippi University Research Center. The U.S. Indices are from The Conference Board. All series are indexed to a base year of 2004.
Monitoring the state’s economy
MISSI SS IPPI LEADING INDEX, NOVEMBER 2014
Page 2
MISSISSIPPI ’S BUSINE SS
F igure 3 indicates the Mississippi Leading In-
dex of Economic Indicators (MLI) lost only
0.05 percent of its value in November. Following
revisions, the value settled at 108.9 and is 6.5 per-
cent higher compared to one year ago. The MLI is
also up 6.9 percent over the last six months.
Four of the seven components of the index contributed
positively in November, led by consumer expectations.
Discussion of each component appears below in order of
largest to smallest contribution.
As seen in Figure 4, the University of Michigan Index
of Consumer Expectations (three-month moving aver-
age) rose markedly in November for the second consecu-
tive month. The value of the index increased 4.7 percent,
reaching its highest level since January 2007. Compared to
one year ago this level was 24.8 percent higher. Consum-
ers’ views about the direction of the economy continue
to improve in part due to falling retail gasoline prices;
however, both inflation expectations components (1-year
and 5-year) of the Index climbed for the first time since
July.
U.S. retail sales rose 0.7 percent in November as indi-
cated in Figure 5, the largest monthly increase since
March. Gains were broad-based, as sales not including
automobiles also were up 0.5 percent. The only compo-
nent that did not increase in November was sales at gaso-
line stations, down for the fourth straight month following
the decline in gas prices. Retail sales were 5.1 percent
higher compared to one year ago, the ninth consecutive
month the year-over-year increase in sales has exceeded
4.0 percent.
Rebounding from the previous month, the value of Mis-
sissippi residential building permits (three-month
moving average) rose 1.7 percent in November as Figure
6 indicates. The value of permits for November was also
11.5 percent higher than one year ago. The seasonally-
adjusted number of units for which building permits were
issued (three-month moving average) in Mississippi
climbed 2.8 percent in November and was 6.9 percent
higher than one year ago. Privately-owned housing units
authorized by building permits in the U.S. in November
dropped 5.2 percent over the revised October estimate.
Compared to one year ago this value was 0.2 percent
lower.
After increasing for two consecutive months, seasonally-
adjusted initial unemployment claims in Mississippi
declined in November. As Figure 7 indicates, total initial
claims fell 1.6 percent from October and were 14.3 per-
cent below the value of one year ago. Conversely, season-
ally-adjusted continued unemployment claims rose in No-
vember following three consecutive months of declines.
As seen in Figure 14 on page 6, continued claims in-
creased 2.1 percent but remained 18.4 below the level of
November 2013. The seasonally-adjusted unemployment
rate in Mississippi in November fell by 0.3 percentage
point to 7.3 percent for the first time since October
2008.
The Mississippi Manufacturing Employment Inten-
sity Index was unchanged in November as Figure 8 indi-
cates; however, the October value was revised up. The
Index was 6.7 percent higher compared to November
2013. While employment in manufacturing in Mississippi
declined slightly in November, average weekly earnings in
manufacturing increased, and the average hourly wage for
manufacturing was unchanged, all of which resulted in no
(Continued on page 4)
Source: University Research Center
Editor’s note: Due to the availability
of data, the Mississippi Diesel
Fuel Consumption Index is no
longer reported or included in the
Mississippi Leading Index.
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
96.0
98.0
100.0
102.0
104.0
106.0
108.0
110.0
11/1312/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/1411/14
Lin
e g
rap
h: p
erc
en
t ch
an
ge
ove
r ye
ar
ag
o
Bar
Gra
ph
: In
dex;
2004 =
100
Figure 3. Mississippi Leading Index
COMPONENTS OF MISSI S S IPPI LEADING INDEX, IN FIGURES
Page 3
JANUARY 2015
Source: U.S. Department of Labor; seasonally adjusted Source: Bureau of the Census; seasonally adjusted
Source: Institute for Supply Management
Source: URC using data from Bureau of Labor Statistics
Source: Thomson Reuters/University of Michigan Surveys of Consumers Source: Bureau of the Census
Source: Mississippi Department of Revenue; seasonally adjusted
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
0
10
20
30
40
50
60
70
80
90
11/13 12/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/14 11/14
Lin
e g
rap
h: P
erc
en
t ch
an
ge o
ver
year
ago
Bar
gra
ph
: In
dex;
1966Q
1 =
100
Figure 4. University of Michigan Index of Consumer Expectations (Three-month moving average)
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
$410
$415
$420
$425
$430
$435
$440
$445
$450
$455
11/1312/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/1411/14
Lin
e g
rap
h: P
erc
en
t ch
an
ge
ove
r ye
ar
ag
o
Bar
gra
ph
: B
illi
on
s o
f cu
rren
t d
oll
ars
Figure 5. U.S. retail sales
-5%
0%
5%
10%
15%
20%
$35
$40
$45
$50
$55
$60
$65
$70
11/13 12/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/14 11/14
Lin
e g
rap
h: P
erc
en
t ch
an
ge o
ver
year
ago
Bar
gra
ph
: M
illi
on
s o
f 2004 d
oll
ars
Figure 6. Value of Mississippi residential building permits(Three-month moving average)
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
4,000
5,000
6,000
7,000
8,000
9,000
10,000
11,000
12,000
11/1312/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/1411/14
Lin
e g
rap
h: P
erc
en
t ch
an
ge
ove
r ye
ar
ag
o
Bar
gra
ph
: N
um
ber
of cla
ims
Figure 7. Mississippi initial unemployment claims
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
75.0
77.0
79.0
81.0
83.0
85.0
87.0
11/13 12/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/14 11/14
Lin
e g
rap
h: P
ercen
t ch
an
ge o
ver y
ear a
go
Bar g
rap
h: I
nd
ex; 2004 =
100
Figure 8. Mississippi Manufacturing Employment Intensity Index
-2%
-1%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
$98
$100
$102
$104
$106
$108
$110
$112
$114
11/13 12/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/14 11/14
Lin
e g
rap
h: P
erc
en
t ch
an
ge
ove
r ye
ar
ag
o
Bar g
rap
h: M
illi
on
s o
f 2004 d
oll
ars
Figure 9. Mississippi income tax withholdings(Three-month moving average)
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
14%
44
46
48
50
52
54
56
58
60
12/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/1411/1412/14
Lin
e g
rap
h: P
erc
en
t ch
an
ge
ove
r ye
ar
ag
o
Bar
gra
ph
: In
dex (
perc
en
t)
(Do
tte
d li
ne
in
dic
ate
s e
xp
an
sio
n t
hre
sho
ld)
Figure 10. ISM Index of U.S. Manufacturing Activity
A s seen in Figure 11, the value of the
Mississippi Coincident Index of
Economic Indicators rose 0.1 percent in
November. Following data revisions, this
increase was essentially the first change in
the index since July. Compared to one year
ago, the value of the index was 1.0 percent
higher in November.
Figure 12 indicates the value of the Missis-
sippi Coincident Index was at 100.1 percent
of its pre-recession peak in November for
the third consecutive month, once again
following data revisions. Alabama and Flori-
da remained the only two states in the
Southeast where the values of their respec-
tive coincident indices were below pre-
recession peaks in November, as both
states continue to lag well behind the rest
of the region. However, Mississippi was
the only other state in the region in No-
vember without a coincident index at least
1.0 percent above its pre-recession peak.
The values of the coincident indices in 48
states increased in November compared to
August as Figure 13 on page 5 indicates.
The values of the indices in eight states
including Mississippi increased between 0.0
and 0.5 percent compared to three months
prior. The indices of the other 40 states
increased more than 0.5 percent in No-
vember compared to August. Alaska and
Wyoming were the only two states where
the values of coincident indices declined in
November compared to three months pri-
or.
net change in the Index. Compared to one year ago aver-
age weekly earnings in manufacturing were up 5.2 per-
cent.
The value of Mississippi income tax withholdings
(three-month moving average) fell 1.5 percent in Novem-
ber, the first decline since August. Figure 9 indicates the
value remained 2.9 percent higher compared to Novem-
ber 2013, however. The value of withholdings in Novem-
ber was also 1.6 percent higher than six months ago.
Figure 10 indicates the Institute for Supply Manage-
ment Index of U.S. Manufacturing Activity lost 5.5
percent of its value in December. The Index decreased
for the third time in the last four months, falling to its
lowest level since June. This decline resulted in the Index
moving 1.8 percent below its value compared to one year
ago. Some of the decline was seasonal, such as the Inven-
tories component, but the New Orders and Production
components fell considerably in December, reflecting the
slowdown in the manufacturing industry nationally.
MISSI SS IPPI LEADING INDEX, NOVEMBER 2014 (CONTINUED)
Page 4
MISSISSIPPI ’S BUSINE SS
Source: Federal Reserve Bank of Philadelphia
Source: Federal Reserve Bank of Philadelphia
MISSI SS IPPI COINCIDENT INDEX, NOVEMBER 2014
96.0%
101.0%
97.0%
103.3% 103.4% 102.5%
100.1%
103.3% 104.2%102.8%
106.7%
114.7%
107.9%
70%
75%
80%
85%
90%
95%
100%
105%
110%
115%
120%
AL AR FL GA KY LA MS NC OK SC TN TX US
Figure 12. Coincident index: November 2014 percentage of pre-recession peak
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
103.0
103.5
104.0
104.5
105.0
105.5
106.0
106.5
107.0
11/1312/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/1411/14
Lin
e G
rap
h:
Pe
rce
nt
ch
an
ge
ove
r ye
ar
ag
o
Bar G
rap
h: In
dex;
2004 =
100
Figure 11. Mississippi Coincident Index
T he U.S. Leading Economic Index (LEI) reported by
The Conference Board rose 0.6 percent in Novem-
ber, the third consecutive monthly increase. The values
for October, August, and July were all revised slightly low-
er, however. The value of the LEI was up 6.1 percent
compared to one year ago. As in the previous month,
eight of the ten components of the LEI increased in No-
vember. The relatively large declines in the initial unem-
ployment claims and building permits components were
more than offset by the increases in the other compo-
nents. The value of the LEI is up 3.6 percent over the last
six months compared to a 2.4 percent increase for the
previous six months.
The Conference Board also reported the value of the U.S.
Coincident Economic Index (CEI) climbed 0.4 percent in
November. The CEI has increased in value for ten consec-
utive months. All four components of the CEI increased in
November and the value of the CEI was up 2.6 percent
compared to one year ago.
The National Federation of Independent Businesses
(NFIB) Small Business Optimism Index rose for the sec-
ond consecutive month in November. The Index climbed
2.1 percent to 98.1, its highest level since February 2007.
The value of the Index was 6.1 percent higher compared
to one year ago. A net 13 percent of respondents—who
were likely influenced by the November elections—
expect the economy to improve in the next six months,
the largest share since November 2010. This component,
along with Expectations for Real Sales Volumes, drove the
November increase in the value of the Index.
In a somewhat unexpected move, the U.S. Federal Re-
serve retained the phrase “considerable time” in its De-
cember statement about interest rates. Many analysts ex-
pected the central bank to remove the phrase in order to
prepare markets and the public for an interest rate hike in
mid-2015. However, the recent fall in oil prices has re-
moved much of the inflationary pressure in the U.S. econ-
omy, and Federal Reserve officials stated they can be
“patient” regarding changes to monetary policy.
NATIONAL TRENDS
Page 5
JANUARY 2015
Source: Federal Reserve Bank of Philadelphia
MISCELLANEOUS ECONOM IC INDICATORS , IN FIGURES
Page 6
Source: U.S. Department of Labor; seasonally adjusted Source: U.S. Bureau of Labor Statistics; seasonally adjusted
Source: U.S. Bureau of Labor Statistics; non-seasonally adjusted Source: Mississippi Department of Revenue; seasonally adjusted
Source: U.S. Bureau of Labor Statistics Source: Institute for Supply Management
Source: National Federation of Independent Businesses Source: Bureau of Economic Analysis; seasonally adjusted at annual rates
MISSISSIPPI ’S BUSINE SS
-28%
-26%
-24%
-22%
-20%
-18%
-16%
-14%
-12%
-10%
-8%
-6%
-4%
-2%
0%
60.0
65.0
70.0
75.0
80.0
85.0
90.0
95.0
100.0
105.0
11/1312/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/1411/14
Lin
e g
rap
h: P
erc
en
t ch
an
ge
ove
r ye
ar
ag
o
Bar g
rap
h: T
ho
usan
ds o
f cla
ims
Figure 14. Mississippi continued unemployment claims
-20%
-18%
-16%
-14%
-12%
-10%
-8%
-6%
-4%
-2%
0%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
11/13 12/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/14 11/14
Lin
e g
rap
h: P
erc
en
t ch
an
ge o
ver
year
ago
Bar
gra
ph
: S
easo
nall
y-a
dju
sted
rate
Figure 15. Mississippi unemployment rate
-4%
-2%
0%
2%
4%
6%
8%
$690
$700
$710
$720
$730
$740
$750
$760
$770
$780
$790
$800
11/13 12/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/14 11/14
Lin
e g
rap
h: P
erc
en
t ch
an
ge o
ver
year
ago
Bar
gra
ph
: Mil
lio
ns
of
2004 d
oll
ars
Figure 16. Real average manufacturing weekly earnings in Mississippi
-14%
-12%
-10%
-8%
-6%
-4%
-2%
0%
$0
$25
$50
$75
$100
$125
$150
$175
11/1312/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/1411/14
Lin
e g
rap
h: P
erc
en
t ch
an
ge
ove
r ye
ar
ag
o
Bar
gra
ph
: M
illi
on
s o
f 2004 d
oll
ars
Figure 17. Mississippi gaming revenue
Coastal River Total Annual Growth of Total
1.2%
1.5%1.6%
1.1%
1.5%
2.0%
2.1% 2.1%2.0%
1.7% 1.7% 1.7%
1.3%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
11/13 12/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/14 11/14
Figure 18. U.S. inflation: price growth over prior year
-10%
-8%
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
44.0
46.0
48.0
50.0
52.0
54.0
56.0
58.0
60.0
62.0
12/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/1411/1412/14
Lin
e g
rap
h: P
erc
en
t ch
an
ge o
ver
year
ago
Bar
gra
ph
: In
dex (
perc
en
t)
(Do
tte
d lin
e in
dic
ate
s e
xp
an
sio
n t
hre
sho
ld)
Figure 19. ISM Index of U.S. Non-Manufacturing Activity
0%
1%
2%
3%
4%
5%
6%
7%
8%
88
90
92
94
96
98
100
11/13 12/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/14 11/14
Lin
e g
rap
h: P
erc
en
t ch
an
ge o
ver
year
ago
Bar
gra
ph
: In
dex;
1986 =
100
Figure 20. NFIB Small Business Optimism Index
-2%
0%
2%
4%
6%
8%
10%
12%
14.0
14.5
15.0
15.5
16.0
16.5
17.0
17.5
18.0
12/13 1/14 2/14 3/14 4/14 5/14 6/14 7/14 8/14 9/14 10/14 11/14 12/14
Lin
e g
rap
h: P
erc
en
t ch
an
ge o
ver
year
ago
Bar
gra
ph
: M
illi
on
s o
f u
nit
s, a
nn
uali
zed
Figure 21. U.S. total light vehicle sales
TABLE 1. SELECTED ECONOMIC INDICATORS
Page 7
Indicator November
2014
October
2014
2013
Percent change from
U.S. Leading Economic Index 105.5 104.9 99.4 +0.6% +6.1%
2004 = 100. Source: The Conference Board
U.S. Coincident Economic Index 110.7 110.3 107.9 +0.4% +2.6% 2004 = 100. Source: The Conference Board
Mississippi Leading Index 108.9 109.0 102.3 –0.1% +6.5% 2004 = 100. Source: University Research Center
Mississippi Coincident Index 106.8 106.7 105.7 +0.1% +1.0% 2004 =100. Source: Federal Reserve Bank of Philadelphia
Mississippi initial unemployment claims 8,350 8,482 9,747 –1.6% –14.3%
Seasonally adjusted. Source: U.S. Department of Labor
Value of Mississippi residential building permits 58.8 57.8 52.7 +1.7% +11.5% Three-month moving average; seasonally adjusted; millions of 2004 dollars.
Source: Bureau of the Census
Mississippi income tax withholdings 111.5 113.2 108.4 –1.5% +2.9% Three-month moving average; seasonally adjusted; millions of 2004 dollars.
Source: Mississippi Department of Revenue
Mississippi Manufacturing Employment Intensity Index 84.6 84.6 79.2 0.0% +6.7% 2004 =100. Source: URC using data from Bureau of Labor Statistics
University of Michigan Index of Consumer Expectations 82.0 78.3 65.7 +4.7% +24.8% Three-month moving average; index 1966Q1 = 100.
Source: Thomson Reuters/University of Michigan Surveys of Consumers
ISM Index of U.S. Manufacturing Activity 55.5 58.7 56.5 –5.5% –1.8% Advanced one month. Source: Institute for Supply Management
U.S. retail sales 449.3 446.1 427.4 +0.7% +5.1% Current dollars, in billions. Source: Bureau of the Census
U.S. Consumer Price Index 125.0 125.7 123.4 –0.5% +1.3%
2004 = 100. Source: URC using data from Bureau of Labor Statistics
Mississippi unemployment rate 7.3% 7.6% 8.0% –3.9% –8.8% Seasonally-adjusted. Source: Bureau of Labor Statistics
Mississippi continued unemployment claims 72,345 70,865 88,705 +2.1% –18.4% Seasonally adjusted. Source: U.S. Department of Labor
ISM Index of U.S. Non-Manufacturing Activity 56.2 59.3 53.0 –5.2% +6.0% Advanced one month. Source: Institute for Supply Management
U.S. mortgage rates 4.14% 4.17% 4.40% –0.6% –5.9% Seasonally adjusted; 30-year conventional. Source: U.S. Federal Reserve
Mississippi average hourly wage for manufacturing 18.26 18.27 18.03 0.0% +1.3% Seasonally adjusted; 2004 dollars. Source: Bureau of Labor Statistics
Mississippi average weekly earnings for manufacturing 787.18 781.84 748.33 +0.7% +5.2% Seasonally adjusted; 2004 dollars. Source: Bureau of Labor Statistics
NFIB Small Business Optimism Index 98.1 96.1 92.5 +2.1% +6.1% 1986 = 100. Source: National Federation of Independent Businesses
U.S. total light vehicle sales 16.80 17.09 15.44 –1.7% +8.8% Millions of units seasonally adjusted at annual rates. Source: Bureau of Economic Analysis
Gaming revenue 136.7 140.2 145.6 –2.6% –6.1%
Coastal counties 72.8 75.5 73.2 –3.7% –0.6%
River counties 63.9 64.7 72.4 –1.3% –11.8% Seasonally adjusted; millions of 2004 dollars. Source: Mississippi Department of Revenue
JANUARY 2015
Eco
no
mic
In
dic
es
Co
mp
on
en
ts o
f th
e M
issi
ssip
pi L
ead
ing I
nd
ex
Mis
cellan
eo
us
Ind
icato
rs
T otal nonfarm employment in Mississippi decreased for
the second consecutive month in November, falling
0.4 percent according to the U.S. Bureau of Labor Statis-
tics (BLS). Table 2 below indicates the state’s economy
lost 4,500 jobs in November, the third decline in the last
four months. Compared to one year ago, total nonfarm
employment in Mississippi is down 1,300 jobs, a 0.1 per-
cent decline. With one month of employment data remain-
ing, the state’s economy has lost a net 900 jobs in 2014.
Declines in employment in the state were widespread
across sectors in November. The one bright spot was Fi-
nancial Activities, which added 1,400 jobs, an increase of
3.3 percent from October. Employment in the sector is up
by 700 positions, or 1.6 percent compared to one year
ago.
The largest absolute decline in employment in November
occurred in the Leisure & Hospitality industry, which lost
2,200 jobs, a decrease of 1.7 percent. However, employ-
ment in the sector remained 1.0 percent higher compared
to November 2013. The Construction industry experi-
enced the largest percentage decline in employment in
November, falling by 2.2 percent or 1,100 jobs. Employ-
ment in Construction has fallen in eight of eleven months
in 2014 and was 7.9 percent lower compared to one year
ago.
In addition to Construction, employment remained lower
in Retail Trade, Information, Professional & Business Ser-
vices, Other Services, and Government compared to one
year ago. Manufacturing has experienced the largest in-
crease in jobs in both absolute and percentage terms over
the past twelve months.
The change in employment in the state in November
stood in contrast to most of the rest of the nation. Missis-
sippi was one of twelve states to lose jobs in November;
only West Virginia lost more jobs in both absolute and
percentage terms. Furthermore, Alaska and Mississippi
were the only states where employment was down in No-
vember compared to one year ago.
Following another considerable decline in employment in
the state for November, even small job growth for the
year appears unlikely unless BLS revises the data for previ-
ous months. In fact, Mississippi will experience negative job
growth for 2014 unless the next employment report indi-
cates a considerable increase in jobs in December.
MISSI SS IPPI EMPLOYMENT TRENDS
Page 8
MISSISSIPPI ’S BUSINE SS
Table 2. Change in Mississippi employment by industry, November 2014
Relative
share of
totalª
November
2014
October
2014
November
2013
Change from
October 2014 Change from
November 2013
Level Percent Level Percent
Total Nonfarm 100.0% 1,119,200 1,123,700 1,120,500 (4,500) –0.40% (1,300) –0.1%
Mining and Logging 0.8% 9,700 9,500 9,300 200 +2.1% 400 +4.3%
Construction 4.5% 49,100 50,200 53,300 (1,100) –2.2% (4,200) –7.9%
Manufacturing 12.5% 141,700 142,000 137,800 (300) –0.2% 3,900 +2.8%
Trade, Transportation, & Utilities 19.5% 217,000 218,100 220,200 (1,100) –0.5% (3,200) –1.5%
Retail Trade 11.9% 132,300 133,500 135,300 (1,200) –0.9% (3,000) –2.2%
Information 1.1% 12,200 12,300 12,700 (100) –0.8% (500) –3.9%
Financial Activities 3.9% 44,300 42,900 43,600 1,400 +3.3% 700 +1.6%
Services 35.6% 399,500 403,000 397,600 (3,500) –0.9% 1,900 +0.5%
Professional & Business Services 8.8% 98,100 99,800 98,500 (1,700) –1.7% (400) –0.4%
Education & Health Services 12.1% 137,100 136,800 135,200 300 +0.2% 1,900 +1.4%
Leisure & Hospitality 11.2% 126,300 128,500 125,100 (2,200) –1.7% 1,200 +1.0%
Other Services 3.4% 38,000 37,900 38,800 100 +0.3% (800) –2.1%
Government 22.0% 245,700 245,700 246,000 — 0.0% (300) –0.1%
ªRelative shares are for the most recent twelve-month average. Source: Bureau of Labor Statistics
MISSI SS IPPI EMPLOYMENT TRENDS BY SECTOR, IN FIGURES
Page 9
Source: Bureau of Labor Statistics (all figures); seasonally adjusted
JANUARY 2015
-0.2%
0.0%
0.2%
0.4%
0.6%
0.8%
1.0%
1.2%
1.4%
1.6%
1,095
1,100
1,105
1,110
1,115
1,120
1,125
1,130
11/1
212
/12
1/13
2/13
3/13
4/13
5/13
6/13
7/13
8/13
9/13
10/1
311
/13
12/1
31/
14
2/14
3/14
4/14
5/14
6/14
7/14
8/14
9/14
10/1
411
/14
Perc
en
t ch
an
ge o
ver
year
ago
Th
ou
san
ds
of em
plo
yees
Nonfarm employment
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
7.0
7.5
8.0
8.5
9.0
9.5
10.0
11/1
212
/12
1/13
2/13
3/13
4/13
5/13
6/13
7/13
8/13
9/13
10/1
311
/13
12/1
31/
14
2/14
3/14
4/14
5/14
6/14
7/14
8/14
9/14
10/1
411
/14
Perc
en
t ch
an
ge o
ver
year
ago
Th
ou
san
ds
of em
plo
yees
Natural resources
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
30
35
40
45
50
55
60
11/1
212
/12
1/13
2/13
3/13
4/13
5/13
6/13
7/13
8/13
9/13
10/1
311
/13
12/1
31/
14
2/14
3/14
4/14
5/14
6/14
7/14
8/14
9/14
10/1
411
/14
Perc
en
t ch
an
ge o
ver
year
ago
Th
ou
san
ds
of em
plo
yees
Construction
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
130
132
134
136
138
140
142
144
11/1
212
/12
1/1
32/1
33/1
34/1
35/1
36/1
37/1
38/1
39/1
310
/13
11/1
312
/13
1/1
42/1
43/1
44/1
45/1
46/1
47/1
48/1
49/1
410
/14
11/1
4
Perc
en
t ch
an
ge o
ver
year
ago
Th
ou
san
ds
of em
plo
yees
Manufacturing
-2.0%
-1.5%
-1.0%
-0.5%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
210
212
214
216
218
220
222
11/1
212/1
21/
13
2/13
3/13
4/13
5/13
6/13
7/13
8/13
9/13
10/1
311/1
312/1
31/
14
2/14
3/14
4/14
5/14
6/14
7/14
8/14
9/14
10/1
411/1
4
Perc
en
t ch
an
ge o
ver
year
ago
Th
ou
san
ds
of em
plo
yees
Trade, transportation, and utilities
-6.0%
-5.0%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
11.8
12.0
12.2
12.4
12.6
12.8
13.0
11/1
212
/12
1/1
32/1
33/1
34/1
35/1
36/1
37/1
38/1
39/1
310
/13
11/1
312
/13
1/1
42/1
43/1
44/1
45/1
46/1
47/1
48/1
49/1
410
/14
11/1
4
Perc
en
t ch
an
ge o
ver
year
ago
Th
ou
san
ds
of em
plo
yees
Information
-2.5%
-2.0%
-1.5%
-1.0%
-0.5%
0.0%
0.5%
1.0%
1.5%
2.0%
42.0
42.5
43.0
43.5
44.0
44.5
11/1
212
/12
1/13
2/13
3/13
4/13
5/13
6/13
7/13
8/13
9/13
10/1
311
/13
12/1
31/
14
2/14
3/14
4/14
5/14
6/14
7/14
8/14
9/14
10/1
411
/14
Perc
en
t ch
an
ge o
ver
year
ago
Th
ou
san
ds
of em
plo
yees
Financial activities
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
94
95
96
97
98
99
100
101
102
11/1
212
/12
1/13
2/13
3/13
4/13
5/13
6/13
7/13
8/13
9/13
10/1
311
/13
12/1
31/
14
2/14
3/14
4/14
5/14
6/14
7/14
8/14
9/14
10/1
411
/14
Perc
en
t ch
an
ge o
ver
year
ago
Th
ou
san
ds
of em
plo
yees
Professional and business services
-1.0%
-0.5%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
130
131
132
133
134
135
136
137
138
11/1
212
/12
1/13
2/13
3/13
4/13
5/13
6/13
7/13
8/13
9/13
10/1
311
/13
12/1
31/
14
2/14
3/14
4/14
5/14
6/14
7/14
8/14
9/14
10/1
411
/14
Perc
en
t ch
an
ge o
ver
year
ago
Th
ou
san
ds
of em
plo
yees
Education and health services
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
4.0%
118
120
122
124
126
128
130
11/1
212/1
21/1
32/1
33/1
34/1
35/1
36/1
37/1
38/1
39/1
310/1
311/1
312/1
31/1
42/1
43/1
44/1
45/1
46/1
47/1
48/1
49/1
410/1
411/1
4
Perc
en
t ch
an
ge o
ver
year
ago
Th
ou
san
ds
of em
plo
yees
Leisure and hospitality services
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
37.2
37.4
37.6
37.8
38.0
38.2
38.4
38.6
38.8
39.0
39.2
11/1
212/1
21/1
32/1
33/1
34/1
35/1
36/1
37/1
38/1
39/1
310/1
311/1
312/1
31/1
42/1
43/1
44/1
45/1
46/1
47/1
48/1
49/1
410/1
411/1
4
Perc
en
t ch
an
ge o
ver
year
ago
Th
ou
san
ds
of em
plo
yees
Other services
-0.6%
-0.4%
-0.2%
0.0%
0.2%
0.4%
0.6%
0.8%
1.0%
1.2%
1.4%
243
244
245
246
247
248
249
11/1
212/1
21/1
32/1
33/1
34/1
35/1
36/1
37/1
38/1
39/1
310/1
311/1
312/1
31/1
42/1
43/1
44/1
45/1
46/1
47/1
48/1
49/1
410/1
411/1
4
Perc
en
t ch
an
ge o
ver
year
ago
Th
ou
san
ds
of em
plo
yees
Government
FISCAL DISPARITIES ACROSS STATES
Page 10
A s the U.S. economy continues to improve five-plus
years into recovery, state governments finally are
experiencing sustained if relatively small growth in reve-
nues. This growth means policymakers can begin to set
more lasting spending priorities in terms of allocating re-
sources. With the current situation in mind, the start of
2015 provides an opportunity to review Mississippi’s rela-
tive fiscal standing.
One method of evaluating a state government’s ability to
generate revenues and provide services is the representa-
tive revenue system and the representative expenditure
system. These approaches use a set of average tax and
expenditure policies to compare how well state govern-
ments can raise revenues and provide services relative to
other states. The procedure also serves as a way to meas-
ure the needs in each state by calculating the total per
capita expenditures for a set of “standard” services pro-
vided by state and local governments across the country,
which allows for a determination of the needs per person
in each state.
The last comprehensive study of this kind was completed
in 2006 by the Urban Institute in conjunction with the
Federal Reserve Bank of Boston for fiscal year 2002.
While initially such a study may appear somewhat dated,
similar studies were conducted during the 1990s and their
findings indicated little change in the general trends over
time. Thus, the 2006 study can yield insights when as-
sessing the current relative fiscal situations of the states.
The Urban Institute study defines a number of terms that
are useful in understanding its findings. The first such term
is tax capacity, which reflects how much tax revenue a
state government could collect by levying the average or
representative tax rate on every potential tax source in
the state. The representative tax rate is a national average
of all state tax rates and is weighted by the size of the tax
base in a particular state. Thus, a state’s revenue capacity
equals its tax capacity plus all revenue from other poten-
tial sources collected at representative levels. If a state’s
actual revenues are greater than its revenue capacity, then
the study describes the state as having a high revenue ef-
fort. Similarly, the study defines expenditure need as how
much a state must spend in order to provide the national
average level of services to its residents. The number of
individuals living in poverty in a state relative to the rest
of the country affects the expenditure need calculation,
which is adjusted for population differences and other
factors. Expenditure effort is the counterpart to revenue
effort and is con-
sidered high when
a state spends
more than its ex-
penditure need.
In other words, a
state is spending
more money than
is required to
meet the repre-
sentative level of
services. As noted
above, these
measures are cal-
culated on a per
capita basis. Final-
ly, a state’s fiscal
capacity as de-
fined in the study
compares its rev-
enue capacity to
its expenditure
need. Thus, if a
state’s revenue
MISSISSIPPI ’S BUSINE SS
Source: Urban Institute and Federal Reserve Bank of Boston
capacity is low, and/or its expenditure need is high, then
the state has a relatively low fiscal capacity.
Figure 22 provides a description of revenue capacities by
state for fiscal 2002. By construction, the revenue capacity
of the U.S. equals 100. The values indicated for each state
are indices relative to the U.S. average. Not surprisingly,
Mississippi has the lowest revenue capacity of any state
with an index value of 72. In fact, most of the states with
the lowest revenue capacities are located in the South-
east. States with the highest values for revenue capacity
tend to be located in the Northeast. However, sparsely
populated states do not necessarily denote low revenue
capacities; both Alaska and Wyoming have some of the
highest index values for revenue capacity because of their
ability to generate revenues from their natural resources.
Figure 23 depicts expenditure needs by index values for
each state. As with the index for revenue capacity, the
U.S. value equals 100 by construction. Mississippi ranks
first in terms of expenditure need with an index value of
113. The six states with the highest expenditure need in-
dices are found in the southern half of the nation. Most
states with relatively low expenditure need values are
found in the Midwest and Northeast. As noted above,
expenditure need
reflects the
amount necessary
for a state to
spend in order to
provide the typical
level of services of
a state govern-
ment.
While the findings
for Mississippi re-
vealed in Figures
22 and 23 are
somewhat ex-
pected, Figure 24
depicts a more
unanticipated re-
sult. As the map
indicates, the reve-
nue effort index
for Mississippi is
one of the highest
among all states,
ranking sixth.
Again, a high reve-
nue effort index means a state’s actual revenues exceed
its capacity to generate revenues. In other words, Missis-
sippi generates more revenues than it would under the
representative system used in the study. Other states
with relatively low revenue capacities, such as Louisiana
and West Virginia, also have relatively high indices for rev-
enue effort.
Finally, Figure 25 depicts fiscal capacity by state. As ex-
pected given the previous findings, the index value for
fiscal capacity for Mississippi is the lowest of all states. Its
value is 64 and the next lowest index value is 70 for Ar-
kansas. A low fiscal capacity can result from low revenue
capacity, high expenditure need, or both. As Figures 23
and 24 indicate, both measures are responsible for the
relatively low value for fiscal capacity for Mississippi.
In conclusion, according to the authors of the Urban Insti-
tute study on fiscal disparities, its findings provide at least
three insights on the relative economic positions of U.S.
states. Fiscal capacity, revenue capacity, and expenditure
need indicate how well a state funds its needs from its
own resources. The revenue effort measure provides a
way to view different categories of revenue sources and
what alternatives could be imposed to the current struc-
FISCAL DISPARITIES ACROSS STATES , CONTINUED
Page 11
JANUARY 2015
Source: Urban Institute and Federal Reserve Bank of Boston
FISCAL DISPARITIES ACROSS STATES , CONTINUED
Page 12
ture. Lastly, the
expenditure effort
measure indicates
whether a state is
spending more or
less than expected
given its de-
mographics. One
caveat to keep in
mind is the aver-
age levels of tax
and expenditure
policies calculated
by the study are
not necessarily
optimal for any
particular state.
Each state can be
assumed to have
some minimum
level of services
that its policymak-
ers believe it
should provide,
but such a level of
services is likely
not equal to the
representative
levels assumed by
the study. Never-
theless, as the au-
thors of the study
note, the relative
comparisons of
states would be
similar for whatev-
er representative
tax and expendi-
ture rates are se-
lected.
MISSISSIPPI ’S BUSINE SS
Source: Urban Institute and Federal Reserve Bank of Boston
Source: Urban Institute and Federal Reserve Bank of Boston