Despite some improvements to Maine’s economy, the leisure and hospitality industries remain among the slowest to recover from the pandemic.
In an August 20 press release, the Maine Department of Labor (DOL) announced that both Maine’s unemployment rate and labor force participation rate increased during July 2021.
The unemployment rate increased from 4.8% in June to 4.9% in July, with the number of Mainers unemployed increasing by 700. The number of payroll jobs increased by 1,200. The DOL reports the unemployment rate increased because labor force participation increased more than employment. Maine’s experience does not differ greatly from that of other states in the region.
Though the economy has improved since lockdowns in the spring of 2020 led to a spike in unemployment, employment has not fully returned to pre-pandemic levels. The number of payroll jobs increased by 40,800 from a year ago but there remain 22,500 fewer jobs in the state than in February 2020, before the COVID-19 pandemic affected Maine’s economy. Maine has experienced a net decrease in the number of jobs by 3.5% since that time, which puts the state slightly ahead of the 3.7% decline at the federal level.
Despite having one of the largest over-the-year gains in the number of jobs, leisure and hospitality is among the industries that have experienced the fewest job gains since February of 2020. The DOL reports the number of employed workers rose to 617,500 in July of 2021. That number has risen from 576,700 in July of 2020, but is still below the pre-pandemic level of 640,000 in February of 2020.
Manufacturing, retail trade, and professional and business services have experienced the most job gains. The DOL reports there are now more jobs in the professional and business services and wholesale trade sectors than before the pandemic.
Public and private education, healthcare and social assistance have had the fewest job gains. Like leisure and hospitality, education has also had significant over-the-year job gains but is among the industries with the fewest gains since February 2020.
According to the DOL, the labor force participation rate is at its highest rate in the past year. During July, labor force participation increased by 0.3% to 60.4%. The employment to population ratio is also at its highest point in the past 16 months. Despite improvements to the unemployment rate, there has been an 11,500 increase in the number of unemployed since February of 2020.
The number of people employed by Maine’s leisure and hospitality industry usually peaks during the summer months, between May and September, when most tourists visit the state. In May 2019, 70,400 people were employed in the leisure and hospitality sector, a number which peaked at 71,200 in June that year before declining to 69,800 in December.
According to the DOL’s Center for Workforce Research and Information, there were 57,000 people employed in leisure and hospitality in June 2021, the most recent month for which data is available. There were 70,600 people employed in the industry in February of 2020. Unlike other years, employment in leisure and hospitality peaked during February 2020 because of the pandemic.
The industry experienced its largest loss in jobs during April 2020, with 35,200 fewer people employed than during the previous year. From June 2020 to June 2021, there has been an increase of 18,000 people employed in the industry. There is still a decrease of nearly 17,000 jobs in leisure and hospitality from the previous year. There were also just over 32,000 fewer people employed in leisure and hospitality in June 2020 than in June 2019.
As employment in the industry usually peaks during the summer months, which are now coming to a close, those jobs may not be fully recovered until next year.