June 1, 2024 (Idaho Department of Labor Press Release, May 31, 2024)
Idaho’s 9.3-week average duration of unemployment claims during 2022-2023 was the lowest in the state’s history and the second lowest in the nation. By comparison, the U.S. average was 15 weeks. Similarly, the state’s 2.7% average unemployment rate for 2022 was the lowest since records began in 1976, eclipsing the previous low of 2.9% in the historically tight labor market of 2018 and 2019.
Low unemployment rates are not a new thing for Idaho. The state’s unemployment rate has been below 3% for three of the last six calendar years (between 2018-2023). Idaho has not recorded an annual unemployment rate of over 4% since 2014 (excluding the immediate post-pandemic period years of 2020-2021). The U.S. has seen rates over 4% as recently as 2017.
From 2020-2022, Idaho’s population growth led the nation as migration accelerated to unprecedented levels. An influx of population at such large magnitudes over a short period of time increased demand for basic services such as health care and education as well as overall goods and services, eateries and home construction. The combination of Idaho’s high population growth and an already tight labor market resulted in every industry at risk of being short-staffed and without a quick fix.
For most of 2022, there were three job postings for every unemployed person in Idaho, an increase from the average one to 1.5 postings per person from 2018-2019. With the state projecting 120,000 jobs created by 2032, it is likely there will continue to be a shortage of qualified labor and employers will continue to struggle to fill their labor needs in a timely manner.
Given Idaho’s high concentration of seasonal-specific industries such as farming, fishing, forestry, mining and construction, the record low unemployment metrics are remarkable. Idaho is extremely diverse in climate averages across the state, with a significant portion experiencing potentially freezing temperatures from mid-October through mid-May.
Nearly half of Idaho’s unemployment insurance claimants in 2023 were classified as employer attached and temporarily laid off due to a lack of seasonal work available for their industry. Claimants qualify as employer attached if they have a set date to return to work within 16 weeks of being laid off or losing employment. Employer attached claims are highly cyclical and predictable, but the duration claimants are off work is based on seasonal patterns.
Unemployment insurance helps people who are unemployed through no fault of their own to remain as active participants in Idaho’s labor force. By providing claimants with a safety net during their time of unemployment, the local economy benefits. Recipients can continue to pay for rent, utilities, groceries, gas and other items while they actively seek employment. Without this financial insurance, many local communities might experience reduced spending, followed by layoffs and business closures. Although weekly unemployment benefits are significantly lower than average weekly wage income, they help soften the financial burden on both the claimant and their local economic region.
