Economy Jobs Report

A help-wanted sign hangs in the front window of the Bar Harbor Tea Room in June 2022. Robert F. Bukaty/Associated Press, file

Maine’s average statewide unemployment rate of 2.9% last year narrowly missed the record low set in 2022, according to data released Friday by the state Department of Labor.

“What we’re seeing is certainly good news for job seekers – maybe not as good for employers, but overall, it’s positive. Job growth is steady,” said Glenn Mills, an economist with the Maine Department of Labor.

Maine was on track to set a new annual record before experiencing slight increases in unemployment over the last five months of 2023. Even with those increases, though, Maine’s rate has been below 4% for 25 consecutive months, the second longest period since the current estimating system was put in place in 1976.

Maine’s rate last year was also lower than the national rate of 3.6%.

The state’s low unemployment rate is just one economic factor to consider, said Richard Bilodeau, interim director of the Center for Economic and Business Research at the University of Southern Maine. A too-low rate can be counterproductive, he said, because it can lead to reduced levels of productivity and can help drive inflation.

“On the surface, you could go, ‘Wow, low unemployment sounds great,’ ” he said. “But if inflation is rising, if wages are not keeping up with the cost-of-living index, if people are not in jobs that they are finding particularly rewarding, then … to me, (unemployment) is not the end all be all measure of how the economy is functioning. I think we have a lot of other things we need to look at.”


The unemployment rate doesn’t capture everyone who isn’t working, only those who are actively seeking work. Many have left the workforce in recent years for various reasons, including retirement.

But Mills said Maine actually has been doing better in workforce participation than the numbers show, and he said revised payroll jobs data for 2023 – which will be released March 11 – will bear that out.

Since 2017, the size of Maine’s workforce has shrunk by more than 16,000 workers, according to state data, although that number has started to increase since bottoming out in 2020. The influx of new residents has begun to offset the impact of mass retirements.

One thing that is often overlooked, Mills said, is the fact that as more and more people have moved into Maine since the pandemic (and even before), they have created more demand in the labor market. More people are needed to fix their cars or provide health care or make their lunch.

“What we’re seeing is sort of without precedent,” he said.

Employers continue to face major challenges filling positions in a tight labor market, although there are encouraging signs.


Michael Bolanz, director of talent acquisition for MaineHealth, one of the state’s largest employers, said the organization is still struggling to attract workers.

“Even through COVID, we’ve hired a fair amount each year, but it’s not what we need,” he said, adding that workforce shortages in health care are happening across the country.

To combat the thin market, Bolanz said MaineHealth has put more effort into workforce development, including launching apprenticeship programs.

“I think you have to be really creative for how you attract talent into the organization,” he said.

Recently, though, more than 100 people came to a walk-in job fair at Maine Medical Center, Bolanz said.

“We haven’t had that many in a long time,” he said.



Other employers also have been responding to challenges by increasing wages, cutting days of operation and scheduling shifts with more flexibility to offer a better work-life balance, said Curtis Picard, president of the Retail Association of Maine.

The results have been good.

“What I would say about the workforce number for retail is that we had more members this past year tell us they were fully staffed or very close to fully staffed,” Picard said. “So, although the unemployment number remains low, retailers have done a good job recruiting staff and retaining them to meet their needs. Jobs are still available for sure, but it’s certainly better than it was pre, during and after the pandemic.”

Patrick Woodcock, president of the Maine State Chamber of Commerce, said the state can still do better at getting some workers “off the sidelines,” but strides are being made.

“We’ve seen employers looking at adding child care and others offering more flexible hours,” he said. “These are conversations we never really had a decade ago.”


Maine’s unemployment rate has ranged mostly between 4% and 8% since 1947, with a spike to 10% in 1975. The Great Recession of 2008 pushed Maine’s unemployment rate up to 8.4%, or nearly 60,000 people within the workforce. That decreased steadily until bottoming out at 2.9% in 2019, before surging in 2020 and 2021 when the pandemic hit.

Measuring unemployment in a post-pandemic world has become more challenging, said Bilodeau, the USM economist.

“A lot of the models rely on a modeling method that could be dated, given how the pandemic has changed people’s work behavior,” he said. “Unemployment, to me, is different than job availability. So when I hear the unemployment flow, it could just be there are people that at this point either aren’t working or choosing to work a reduced schedule or part time, as the basis of a whole bunch of things like the gig economy or like the impact of the pandemic.

“Lots of people aren’t happy about having to return to an office, and that has some people’s priorities about their thinking about work.”

Staff Writer Kay Neufeld contributed to this report.

Related Headlines

Comments are no longer available on this story