Highlights from the Q2 Labor Market Report

This week marks the release of Talent 2025’s third quarterly labor market report in the series being released this year, spanning the second quarter of 2021. This report is a critical component of our effort to catalyze and align the talent system in West Michigan, with the provision of actionable data and analysis on in-demand occupations and the state of the labor force serving to inform, guide, and align workforce development efforts throughout the region. The report contains a more comprehensive analysis of the various economic indicators found below, which will be updated to reflect data from the third quarter of 2021 as more information becomes available.

T2025 Q2 2021 Talent Report 1

At the end of the second quarter of 2021, West Michigan’s labor market and the demands of employers looks dramatically different from the release of the inaugural report in 2014. Today, regional unemployment stands at 5.0 percent, on par with the state and below the nation. Although this remains higher than the historic low of 2.9 percent observed for the region before the onset of the pandemic, it is a significant improvement from the all-time high of 23.0 percent observed in April 2020.

Despite nearly twice as many jobseekers, a majority of employers still report difficulty finding talent to meet their needs. The ‘skills gap’ remains, but changing expectations among workers have also contributed to the difficulty finding talent — requiring innovative strategies for employers to adapt to the new talent landscape.

Labor Force and Unemployment

In the second quarter of 2021 West Michigan’s employment situation began to improve as more jobseekers entered the market and found employment, resulting in slight improvements to the region’s unemployment rate. The size of the unemployed population fell by 8.4 percent (3,756 jobseekers) from Q1 2021, resulting in a gain of 4,194 labor force participants and 7,950 more employees. The region’s unemployment rate continued to fall, rebounding by 0.5 percent to stand at 5.0 percent in Q2 — identical to the statewide rate and below the national rate (5.8%). Employer demand continued to gain momentum over the quarter with online job ads growing by 3.7 percent (3,230 ads).

The labor force in West Michigan began to inch back from its trough during the second quarter of 2021, although nearly 14,300 participants have left the market since Q2 2020 (-1.7%). Employment grew over the year as fears of COVID-19 began to subside, with 83,489 more employed this quarter (12.1%) compared to 2020. The size of the unemployed population plummeted by 71 percent from Q2 2020, with 97,789 fewer jobseekers in Q2 2021 for a total unemployed population of over 40,800. Although the labor market has improved drastically from this time last year, the lack of available jobseekers has greatly constrained potential growth.

Industry Jobs

Employment among Goods-producing industries in West Michigan grew by 2.6 percent (3,800 jobs) in Q2 2021, while Service-providing industries recovered 10,367 jobs (2.4%) — resulting in a net gain of 14,167 jobs for the region over the quarter. The largest quarterly gains were attributed to Leisure and Hospitality (14.2%; 6,033), Mining, Logging and Construction (11.6%; 3,033), Other Services (3.3%; 700), and Professional and Business Services (2.4%; 1,733). Losses persisted for just two industries over the quarter: Government (-0.6%; -300) and Education and Health Services (-0.1%; -67). Ottawa (4.1%), Barry (4.5%), and Allegan (4.6%) experienced the lowest Q2 unemployment rates, while Oceana (-1.9%), Mason (-1.4%), and Lake (-1.1%) saw the greatest improvements over the quarter.

Nonfarm employment in West Michigan recovered by 14.3 percent year over year, reflecting 74,800 more employed in Q2 2021. Although Goods-producing industries gained back 19,733 jobs since Q2 2020, 3 in 4 recovered jobs originated from Service-providing industries — which employed 55,067 more workers in Q2 2021 compared to the previous year. The largest numeric gain was attributed to Manufacturing (17,033), while Information was the only sector to employer fewer workers (-367) in 2021 compared to the previous year.

Real-time Demand

Online job advertisements in West Michigan continued to show evidence of recovery during the second quarter of 2021, with 3,230 more ads in Q2 2021 compared to the previous quarter. There were 89,429 job openings posted online in Q2, which reflects a growth of 3.7 percent from Q1 and 36 percent year-over-year. The average time to fill an opening fell from 31 days in Q1 to 24 days in Q2, while the median advertised hourly wage dropped by $2.22 to stand at $17.78 in Q2 2021. The share of low-skill job postings remained relatively constant over the quarter, hovering around 71 percent.

The top posted occupations in the second quarter of 2021 included Heavy and Tractor-Trailer Truck Drivers (12.2% of total), Registered Nurses (5.6%), Retail Salespersons (5.5%), First-line Supervisors of Retail Sales Workers (5.4%), and Customer Service Representatives (4.0%). The largest spike in demand observed over the quarter included occupations in Production (72.2%), Installation, Maintenance and Repair (66.2%), Educational Instruction and Library (60.2%), and Personal Care and Service (59.1%).

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