Oklahoma May Employment

Unemployment

After remaining fairly steady at an average of 2,558 new unemployment claims filed each week in Oklahoma, the number dropped by 96 for the first week of June. 

Continued claims increased by 117 for the week ending 5/26/2012 from the previous week.

According to the BLS the unemployment rate in Oklahoma rose slightly in May to 4.8 percent from the April 4.4 percent. The total number unemployed grew from 79,144 in April to 86,532 in May, or by about 9 percent. This may have to do with the labor force increase (as graduations came about) of 7,058 people during the same period. Over the past 10 years we have seen an increase in unemployment in May and June then a decrease during the fall months. The report shows that the number of people employed dropped by only 330 from April to May of this year. 

Employment

As noted above, the number employed in Oklahoma dropped by 330 from April to May, a trend we see happening each year at varying numbers. The total employed was, 1705,744 in May.

With the labor force growing from 1,785,218 in April to 1,792,276 in May, or 7,058 people, the number of available jobs could not keep pace.

The average hourly wage increased by $ .03 from April to May from $20.66 to $20.69. This is still a decrease from January $21.03 by $ .34 per hour. That equates to about $54.00 each month lost in wages since January.

It is important to keep in mind that the hourly wages from the BLS shown here are for all private industries. The fact that many new jobs have been made available will have an impact on the average hourly wage reported here.

Total Collections Grow in May as Gross Production Continues

Even though natural gas and crude oil prices are lower than expected, Oklahoma’s total revenue collections continue to rise, driven primarily by income and sales, State Treasurer Ken Miller said today as he released the monthly gross receipts report for May.

“With incomes climbing and sales tax collections on the rise, Oklahomans continue to show confidence in the economy in spite of renewed global uncertainty and a pullback in U.S. job growth,” Miller said.

May collections are up by 5.8 percent from May of last year, Miller said. That compares to average growth over the past 12 months of 9.2 percent. 

Watching natural gas and oil prices

In May, collections from gross production taxes on oil and natural gas were less than the same month of the prior year for a sixth consecutive month, and for the seventh time in eight months. Reflecting the continued downward slide in gross production collections, the 12-month running total for that revenue source turned negative this month.

The percentage of total gross production taxes generated by natural gas production has steadily fallen since last year. In October, 51 percent of gross production collections came from gas extraction. By April, the amount had dropped to 32 percent. The proportion of the tax produced by natural gas for May is not yet available.

Gross production collections in May reflect prices and production from March, when the spot price for natural gas at the Henry Hub in Louisiana, considered a benchmark for gas prices, averaged $2.06 per thousand cubic feet. April prices dropped to an average of $2.01, but May prices rose to an average of $2.51.

In the past month, the price of crude oil has also trended downward. From late February until the end of April, the spot price of West Texas Intermediate Crude Oil at Cushing stayed above $100 per barrel. In May, crude prices dropped throughout the month, closing May 31 at $86.53/bbl, levels not seen since last October.

Rig counts last week were set at 192 total, 22 higher than at the same time last year. However, active natural gas rigs have dropped from 122 last year to 53 this year. Active oil rigs have climbed from 48 last year to 139 this year.

“In the coming months, we will be keeping a close watch on natural gas and crude oil prices and any potential spillover effect on the Oklahoma economy,” Miller said.

Overall growth seen

Income tax collections have risen by double-digits from the same month of the previous year in nine of the past 12 months, while sale tax collections have averaged eight percent growth during the same time.

Since hitting the trough on revenue collections from the recession in February 2010, 12-month collections have increased by $1.63 billion and are now only $289 million below the peak in December 2008.

Miller pointed to the latest reports on state and local unemployment as bright spots.

“At 5.0 percent, the April unemployment rate for Oklahoma is more than three percentage points lower than the national rate. Oklahoma City’s rate of 4.0 percent is the lowest of the nation’s 49 largest cities and speaks to the strength of the rebounding economy,” he said. “Reports show 38,500 more Oklahomans have jobs now than a year ago.”

May collections

The revenue report for May sets gross collections at $858.9 million, up $46.7 million or 5.8 percent from May 2011.

Gross income tax collections, a combination of personal and corporate income taxes, generated $268.5 million, an increase of $35.2 million or 15.1 percent from the previous May.

Personal income tax collections for the month are $258.2 million, up $35.9 million or 16.1 percent from the prior year. Corporate collections are $10.3 million, down by $600,000 or 5.8 percent.

Sales tax collections, including remittances on behalf of cities and counties, total $335.5 million in May. That is $21.6 million or 6.9 percent above May 2011.

Gross production taxes on oil and natural gas generated $63.1 million in May, a decrease of $32.5 million or 34 percent from last May. Compared to April reports, gross production collections are up by $1.1 million or 1.8 percent.

Motor vehicle taxes produced $62.3 million, up by $6.5 million or 11.6 percent from the prior year.

Other collections, consisting of about 60 different sources including taxes on fuel, tobacco, horse race gambling and alcoholic beverages, produced $129.5 million during the month. That is $16 million or 14.1 percent more than last May.

Twelve-month collections

Between June 2011 and May 2012, gross revenue totals $10.99 billion. That is $923.1 million or 9.2 percent higher than collections from the previous 12-month period.

Gross income taxes generated $3.85 billion for the period, reflecting an increase of $420.5 million or 12.3 percent from the prior 12 months.

Personal income tax collections total $3.32 billion, up by $311.6 million or 10.3 percent from the June 2010 to May 2011 period. Corporate collections are $530.6 million for the period, an increase of $109 million or 25.9 percent over the previous period.

Sales taxes for the period generated $4 billion, an increase of $303.9 million or 8.2 percent from the prior 12-months.

Oil and gas gross production tax collections brought in $940 million during the 12 months, down by $15.5 million or 1.6 percent from the previous period.

Motor vehicle collections total $688.8 million for the period. This is an increase of $58.6 million or 9.3 percent from the trailing 12 months.

Other sources generated $1.51 billion, up $155.6 million or 11.5 percent from the previous 12 months.

Budget Deal Reached: Fallin & Legislative Leaders Announce Fiscally Conservative Budget

Press Release

Governor Mary Fallin and leaders in the Oklahoma House and Senate today came to a budget agreement that includes targeted funding increases for core services. Fallin and other state leaders said the proposed $6.8 billion budget was a fiscally conservative roadmap for the state that controls spending while allowing for improvements to be made in health and human services, public safety, transportation, education and other important areas of government.

“This budget deal is a responsible, fiscally conservative agreement that appropriately funds core government services,” Fallin said. “The targeted increases we are pursuing will help to improve child welfare services, repair structurally deficient bridges, increase access to health care in rural areas, and boost resources for public safety. Additionally, this budget agreement will also ensure the state supports common education and keeps its promise to teachers by funding health benefits and bonuses.  All of these things will help to improve state government services and make Oklahoma a better place to live and raise a family.”

House Speaker Kris Steele said the budget deal successfully limited unnecessary government growth.

“This budget moves Oklahoma forward on multiple fronts,” said Steele (R-Shawnee). “It represents a commitment to responsible fiscal conservatism by limiting unnecessary government growth while still increasing resources for government’s core services. It’s a straightforward, balanced budget that will benefit the public and private sectors alike in many different ways.”

Senate Pro Tem Brian Bingman said the proposal represented a common sense, conservative approach to budgeting.

“Oklahomans deserve a conservative budget that reflects our values,” Bingman (R-Sapulpa) said.  “Budget dollars should be targeted to fund important core functions of government—giving Oklahoma’s kids a better education, fixing our broken roads, and protecting society’s most vulnerable children from abuse and neglect. This agreement demonstrates a commitment to govern in a fiscally responsible way-- I’m proud of our common-sense, conservative approach.”

FY 2013 Budget Proposal: Funding Increase Highlights

·         State Department of Education: Annualization of FY 2012 $52.4 million supplemental for flexible benefit allowance for teachers and support staff and National Board Certified Teacher bonuses.

·         CareerTech : Annualization of FY 2012 $1.4 million supplemental for operations

·         Higher Education: Annualization of FY 2012 $10 million supplemental for operations.

·         Military:  $500,000 for renovation of armories

·         Transportation: $99 million increase to repay FY 2012 fund transfer; ensures eight year road and bridge plan remains intact and anticipates implementation of the Bridge Improvement and Highway Modernization plan proposed by the governor in future fiscal years

·         Health Department:

o   $1 million increase for infant mortality initiatives

o   $500,000 for Cord Blood Bank

·         Health Care Authority:

o   $3.080 million to fund the rural residency program to increase access to health care in rural and underserved areas.

o   $57 million – Maintenance of Effort and Growth

o   Transfer of Behavioral Health dollars to the Department of Mental Health - $118,492,703

·         Department of Human Services:

o   $25 million to fund Pinnacle Plan reforms

o   $17 million for maintenance of effort and replacement of one-time funding in FY-2012

o   $1.5 million for Advantage Waiver Program to provide reimbursement rate increases for home health care providers that serve the elderly

o   $1.5 million to provide Developmental Disabilities Services Division (DDSD) reimbursement rate increases

o   $1 million to reduce the current DDSD waiting list

·         Department of Mental Health and Substance Abuse Services

o   $5.5 million for Systems of Care Grant and for an additional crisis center.

o   $667,000 for mental health screenings to determine the risks and needs of each offender; justice reinvestment.

o   Transfer of Behavioral Health dollars from OHCA - $118,492,703

·         Department of Rehabilitation Services : $300,000 increase to reduce the waiting list for services

·         University Hospitals Authority:

o   $3 million increase for  Tisdale center in Tulsa

·         Veterans Affairs : $1 million increase to increase nursing staff and reduce staff/patient ratios

·         Commerce:  $500,000 for Base Realignment and Closure Commission

·         Conservation Commission: $500,000 increase for water monitoring projects

·         Water Resources Board:  $1.5 million increase for water monitoring projects

·         Attorney General: $5 million supplemental for water lawsuit and $2 million for justice reinvestment grants to local law enforcement agencies

·         Corrections :

o   $2.9 million to close designated wings of the Oklahoma State Penitentiary in McAlester, build a lethal fence, transfer up to 800 prisoners to private beds

o   $1 million for justice reinvestment

·         Medicolegal Investigations: $1 million supplemental and $1.5 million annualization of supplemental to obtain re-accreditation (personnel, equipment and infrastructure improvement)

·         Department of Public Safety:

o   $5 million for authorization of an annual trooper academy with capacity for 40 participants

Funding Cuts

·         Commission on Indian Affairs and Oklahoma Human Rights Commission will be eliminated which will cut $192,307 and $531,270 from the FY 2013 budget respectively

·         Department of Civil Emergency Management cuts 98% of its budget equal to $34,145,707

·         Oklahoma Health Care Authority funding is cut but 5.9% or $531,270 (FY2012 $983,085,563 to FY2013 $925,063,007)

·         Department of Environmental Quality receives a 2.58% cut of $200,000

·         Attorney General funding cut of $3,000,000 or 16.46%

·         Department on Consumer Credit has a 90.43% cut of $300,000

Most agencies will receive the same amount in funding from FY2012 in the proposed FY2013 state budget (see agency level appropriations here).  

The budget includes an overall increase of 3.13% or $206,840,686 in spending for FY2013. The agreement will need to be passed by this Friday, May 25 when the session is scheduled to end.  We should have a more detailed breakdown by then.

April Oklahoma Employment Numbers

Unemployment

The BLS has released April employment and unemployment numbers. The preliminary unemployment rate for April in Oklahoma is 4.4%. This is down .5% from the March rate of 4.9%. In terms of numbers that is a little over 7,600 fewer unemployed than the March count of 86,403.

As compared to April 2011, the rate last year was 5.4% which was also a .5% drop from March of 2011. April 2012 is 1% lower than last year. The total unemployed in April of 2012 was 94,872 compared to 78,740 of this year. That is a decline of 16,132 or 17% fewer people unemployed in April of 2012 than in April 2011.

As shown in the graph below, the rate has dropped 1.9% since January of this year.

Oklahoma Unemployment Rate 2011 – 2012

Oklahoma Number Unemployed 2011 -2012

Employed

The number reported as employed in April 2012 grew by 14,121 to 1,705,846. This represents a 1% growth in the number of people employed from March of this year. This also represents a growth of 2% or 38,870 from April of 2011.

Oklahoma Employed 2011 – 2012

Labor Force

The increase in the number employed outpaced the growth of the labor force by over 2 to 1. The workforce saw an increase of 6,458 from March to April as compared to the increase of 14,121 people employed over the same period.

Oklahoma Labor Force 2011 – 2012

Claims

The new claims filed for the first week of May (ending May 05, 2012) from the previous reporting week (ending April 28, 2012) increased by 394 from 2,199 to 2,153.

Initial Claims May 5,2012

State Economy Weathering Well

Oklahoma’s total revenue collections resumed their upward trajectory in April after slipping slightly in March, while gross production taxes continued to shrink, State Treasurer Ken Miller said today as he released the monthly gross receipts report.

“Oklahoma’s economy is reflecting health and resilience in spite of the low price environment for natural gas,” Miller said.

Total collections for the month were $1.16 billion, up by almost $83 million or 7.7 percent from April of last year. Miller said all major sources of revenue saw growth over the prior year except for gross production, which fell by more than 20 percent.

Income tax collections jumped by more than 10 percent from the prior year and accounted for almost 50-cents of every dollar collected in April, the tax-filing deadline month. Sales tax collections, up by 7.1 percent, moderated slightly in April following months of double-digit growth.

Gradual Erosion

In April, collections from gross production taxes on oil and natural gas were less than the same month of the prior year for a fifth consecutive month, and for the sixth time in seven months.

During those months, the percentage of gross production taxes generated by natural gas production has steadily decreased as prices have fallen. In October, 51 percent of gross production collections came from gas extraction. By March, the amount had fallen to 34 percent. The proportion of the tax produced by natural gas for April is not yet available.

Gross production collections in April reflect prices and production from February, when the spot price for natural gas at the Henry Hub in Louisiana, considered a benchmark for gas prices, averaged $2.51 per thousand cubic feet. Since then, prices have dropped even further, averaging less than $2 per thousand cubic feet in April.

“We will closely monitor falling natural gas prices in the coming months to gauge any impact,” Miller said. “Right now, the Oklahoma economy looks good and free of any spillover effects.”

State economy weathering well

Miller said the state’s economy appears to be “weathering well the challenge” as it shows continued improvement.

“Collections in all revenue categories are up except for gross production,” he said. “Consumers appear confident in the direction of Oklahoma’s economy with sales still climbing, though at half the rate seen in March.”

Since hitting the trough on revenue collections from the recession in February 2010, 12-month collections have increased by almost $1.6 billion and are now only $336 million below the peak in December 2008.

Miller pointed to the latest reports on state unemployment as another bright spot.

“At 5.4 percent, the March unemployment rate is very good news,” he said. “Reports show 21,460 more Oklahomans have jobs now than a year ago. And this compares to a U.S. unemployment rate of 8.2 percent.”

April collections

The revenue report for April shows gross collections at $1.16 billion, up $82.7 million or 7.7 percent from April 2011.

Gross income tax collections, a combination of personal and corporate income taxes, generated $565.4 million, an increase of $55.3 million or 10.8 percent from the previous April.

Personal income tax collections for the month are $489.8 million, up $45.6 million or 10.3 percent from the prior year. Corporate collections are $75.6 million, up by $9.7 million or 14.7 percent.

Sales tax collections, including remittances on behalf of cities and counties, total $347.3 million in April. That is $22.9 million or 7.1 percent above April 2011.

Gross production taxes on oil and natural gas generated $62 million in April, a decrease of $16.5 million or 21.1 percent from last April. Compared to March reports, gross production collections are down by $5.7 million or 8.4 percent.

Motor vehicle taxes produced $56.7 million, up by $6.9 million or 13.8 percent from the prior year.

Other collections, consisting of about 60 different sources including taxes on fuel, tobacco, horse race gambling and alcoholic beverages, produced $125.2 million during the month. That is $14.1 million or 12.7 percent more than last April.

Twelve-month collections

Between May 2011 and April 2012, gross revenue totals $10.95 billion. That is $954.8 million or 9.6 percent higher than collections from the previous 12-month period.

Gross income taxes generated $3.82 billion for the period, reflecting an increase of $417.4 million or 12.3 percent from the prior 12 months.

Personal income tax collections total $3.29 billion, up by $304.9 million or 10.2 percent from the May 2010 to April 2011 period. Corporate collections are $531.2 million for the period, an increase of $112.4 million or 26.8 percent over the previous period.

Sales taxes for the period generated $3.98 billion, an increase of $303.3 million or 8.3 percent from the prior 12-months.

Oil and gas gross production tax collections brought in $972.5 million during the 12 months, up by $27.5 million or 2.9 percent from the previous period.

Motor vehicle collections total $682.3 million for the period. This is an increase of $61.3 million or 9.9 percent from the trailing 12 months.

Other sources generated $1.5 billion, up $145.4 million or 10.8 percent from the previous 12 months.