Palm Beach County set to close 2022 with near record low unemployment

Palm Beach County's labor market is set to close out 2022 with an unemployment rate well under 3%, and close to a record set last April, defying the more restrained forecasts from a year ago.

"We've been really encouraged with what we've seen through the year here. Frankly, it's  better than many of us thought so that's a good thing," said Tom Veenstra, vice president of administration at CareerSource Palm Beach County. "If you live and work here, you've been really lucky. We've been doing much better than the nation as a whole, and for a lot of that time, better overall than the state."

That's been fruitful for those looking for work, and frustrating for employers looking to hire. Especially as older workers continue retiring but the ranks of younger workers aren't plentiful enough to fill the voids. All which has led labor economists and businesses to ask: Where have all the 20-somethings gone?

Still, the most recent jobs report, for October, presented a very bullish snapshot.

The county's jobless rate stood at just 2.7%, almost a full percentage point under the 3.5% rate registered for the same month in 2021. Plus, it's just a fraction of a percent above the historic low for the county of 2.3% set this past spring.

There appears to be little on the horizon to end the party for those looking for jobs, or seeking to upgrade their workforce status. The county's economy is still at the beginning of the winter tourism season, and holiday shopping will also bolster hiring.

The leisure and hospitality industry added almost 14% more jobs, 11,600 positions, in the past year. The trade, transportation and utilities sector, which includes all those package delivery workers, added 4,600 more people to the employment rolls.

County employment officials keeping an eye on economy, housing market

While he said there are "no signs of recession," Veenstra and others are closely watching what happens with the housing market. Home sales sometimes can spot larger trends, positive and negative, in the economy.

Veenstra points to national reports that show a sharp rise in housing inventory and stagnating prices in the wake of Federal Reserve interest rate increases that have hiked up borrowing costs.

The Palm Beach County housing market has lost some of its sizzle since the summer, but remains decidedly in favor of sellers. Existing single-family homes sold for a median price of $570,000 in October, still 14% higher than during the same month last year, according to the most recent survey by the Broward, Palm Beaches and St. Lucie Realtors Group. The October price is down, however, from the record high median of $620,000 in June.

Another key benchmark, the supply of homes for sale, rose to 3.2 months worth. But that figure is still well under the 5.5 months worth of inventory that market analysts say denotes a market in which neither sellers or buyers do not appear to have a clear advantage.

Employers having a hard time filling vacant jobs In Palm Beach County

While the 2023 is set to start as another "job seekers market," that's not good news for employers looking to fill vacant jobs, or to add workers needed for business expansions.

CareerSource said there were 35,641 job openings versus 20,681 unemployed people in October. One reason the chasm continues to exist is a belief that a tight labor market will produce an even better opportunity if a job seeker waits.

"They are saying, 'You know what, I'm going to wait for the right opportunity to come along,'" Veenstra said. "Well, I don't know how long that's going to last."

Veenstra and CareerSource say one relatively new trend has emerged explaining the chronic gap in available workers: A shortfall of 20-somethings entering the workforce.

It's long been stated that labor shortages have been aggravated by the early retirements and exits of people over the age of 55 from the labor market. CareerSource has often cited data analysis that some 3 million Baby Boomers have been retiring annually since 2020, way more than the on average 2 million Boomers that stopped working per year before the pandemic.

Worsening that higher rate of departures, CareerSource cited a Wall Street Journal report showing roughly 500,000 fewer workers in their early 20s compared to 2019 levels.

"This is kind of a new thing that we uncovered," Veenstra said. "We have a shortfall of young workers not replacing the older workers, and even workers in the middle range. And this is going to be an ongoing concern."

Many reasons why a shortfall of 20-something workers has materialized

Veenstra said there are many reasons why this trend has emerged. Some younger workers have encountered caretaking challenges — for parents, grandparents or young children — or have opted for home schooling, and can't work unless it is a flexible remote "work-from-home type of job."

Others, he said, have decided to seek job training to improve their labor market opportunities through career training. And others decided to stay in college and seek a post-graduate degree.

For Ryan Chatoo, it was a combination of several factors.

The 21-year-old from Miami had planned to get a job and gain some career experience after graduating with an economics and history degree from the University of Florida this year, ahead of schedule. His original goal, he said, was to find a job as a financial analyst for a hedge fund or an investment firm and see if he "really wanted to go to law school after I've had time to grow up and experience the real world."

Those plans changed after his father had a stroke in the winter of 2020, Chatoo said.

"So it became a game of necessity," he said. "I needed to go to law school, get out as soon as possible and start making money as soon as possible to help my family pay off all that medical debt and such."

Chatoo is now in his first year of law school at UF, still figuring out which field within the law to focus on.

"Family law is looking pretty good right about now," he said. "But people change a lot n law school and I am definitely keeping my options open."

Hopefully, Chatoo and others will find an equally hot job market as soon as they graduate.

Veenstra said the younger job seekers historically got the "short end of the stick" while entering the workforce back when there was much more competition for lower-paying, entry-level jobs with limited potential for upward mobility.

The seemingly insatiable demand for workers in the past year has turned the tables. Now it's employers who have to be competitive with higher wages, better benefits, bonuses and perks like hybrid work-from-home arrangements.

"In the last year, this group of job seekers has probably had it better than anybody else," Veenstra said. "Younger workers wield a lot more power now than they did in the past, so this experience with post-COVID has been very good for this age group."

Antonio Fins is a politics and business editor at the Palm Beach Post, part of the USA TODAY Florida Network. You can reach him at afins@pbpost.com. Help support our journalism. Subscribe today.

This article originally appeared on Palm Beach Post: Palm Beach County to end 2022 with near historic low unemployment rate