Meltdown: Jobs Market In U.S. Energy States

Takeaway: Energy jobs are sliding off the cliff into the abyss. Our energy tracker spread broke to a new higher high in the latest week.

Editor's Note: Below is an excerpt from an institutional research note from our Financials team today with an update to their previous note on energy-dependent state jobless claims. For more information on how you can become a subscriber please send an email to


Meltdown: Jobs Market In U.S. Energy States - Oil cartoon 12.08.2015


The jobs market in energy states remains in accelerating meltdown. With energy companies set around year end to lose the last remaining cushion of their previously established hedges, job cuts in the 8 states with the most energy-dependent economies (AK, LA, NM, ND, OK, TX, WV & WY) are blowing out versus the rest of the country.


The chart below shows that in the week ending December 5, the spread between the indexed series of claims in energy states versus the indexed series of claims in the country as a whole increased from 47 to 51. That is the largest the spread has been since our analysis' May 2014 starting point. 


Meltdown: Jobs Market In U.S. Energy States - Claims18


Last week, we were asked why we didn't include the state of Colorado in our 8-state basket. Our response was that our basket was borne out of this article, which showed the 8 states with the highest energy-related employment as a % of total as of 2011.


We were then sent an interesting paper detailing the exposure of Denver to the oil and gas industry. In a nutshell, 11% of downtown Denver's workforce is employed in the oil and gas industry at an average level of compensation roughly 3x the rest of the workforce. From 2005-2014, one-third of the new jobs created in the downtown Denver area were oil and gas jobs. The point here is that while these 8 states represent some gauge of the fallout from energy's collapse, there are many other areas that are being impacted.


Apart from the carnage in energy claims, national claims data continues to show that the economy is late stage and the Fed's rate increase yesterday is unlikely to extend the duration of the recovery. 

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