PANAMA CITY BEACH — The Bay County area is observing a year-over-year reduction in employment, according to a report released last month by the U.S. Bureau of Labor Statistics (BLS).
The data registered a total of 73,600 jobs in the Panama City-Lynn Haven-Panama City Beach metro area in October, a decrease of 700 jobs, or 0.9 percent, from employment numbers in October 2013.
The leisure and hospitality sector saw the highest rate of job loss, declining by about 500 jobs over the year.
Officials with CareerSource Gulf Coast, which provides services for job seekers and employers in the region, consistently have disputed the numbers, citing growth in Tourist Development Tax revenues and other key economic factors in the Panama City Beach area.
And they’re not the only ones scratching their heads.
“I’m puzzled, as well, looking at the Panama City numbers,” said Rick Harper, director of the University of West Florida’s Haas Center for Business Research.
Harper cited an explosion of new condominium inventory in Panama City Beach, with roughly 8,000 units added between 2003 and 2007, that should be supporting more visitors, more residents and more jobs in the area.
“When you’ve seen as much new capacity come online as we have in Panama City, the numbers are a bit puzzling,” Harper said. “We should be seeing some substantial growth in tourism and that should bring some population growth with it.”
Compiled by the BLS, job growth statistics are estimated using payroll surveys from Florida employers.
Estimates are reported every month, and the numbers also are revised through an annual “benchmarking” process that takes into account the state’s Re-employment Assistance Program, Tourist Development Tax revenue and more, which can cause job counts to rise and fall.
Harper also offered another explanation for declining hospitality jobs in Panama City Beach, citing a possible increase in the number of self-employed contract workers, or 1099 employees as catalogued by the Internal Revenue Service (IRS).
“A reason that there could be some bias, and it’s something that I’ve seen before, is if employers are switching to using more 1099 employees,” he said. “1099 employees would not show up in the payroll survey.”
According to a report compiled using internal aggregate data from the company ZenPayroll, a payroll processor for thousands of small businesses in the U.S., the number of contract workers as a representation of the total workforce in Florida has jumped from 6.74 percent to 12.32 percent in the last year.
Harper said many businesses are moving toward using contract workers instead of full-time employees to avoid certain liabilities, particularly a new mandate under the Affordable Care Act that requires all businesses with 50 or more full-time employees to provide company health insurance.
Overall, the Panama City-Lynn Haven-Panama City Beach metro area was one of just two Florida metro areas that reported a year-over-year job loss last month. The Ocala metro area lost 1,000 jobs, for a year-over-year reduction of 1.1 percent.
If a migration toward contract work is to blame for job loss in the hospitality sector, Harper said it would not be picked up during the BLS’s benchmarking process.
“That would not get picked up in the end of the year revisions because those people are likely to be self-employed,” he said. “You can’t count on the end-of-the-year benchmarking” to correct it.