Did Abnormal Weather Affect U.S. Employment Growth in Early 2015?
A current policy concern centers on how the severe winter weather experienced in some parts of the country may have affected the economy earlier this year. As of 2015:Q1, monthly payroll growth has slowed by more than 100,000 jobs compared to 2014:Q4, while GDP declined at an annual rate of 0.7 percent. To measure the potential effect of weather on recent employment growth, the author estimates a regression model using state-level employment and weather data from 1981 onward. The coefficients from this model are combined with data on recent weather to generate an estimate of how weather is likely to have affected employment growth earlier this year. The specification of the regression model builds on some recent research by Boldin and Wright (2015), who show that abnormal weather is likely to have the biggest effect on employment if it occurs on or just before the 12th day of each month, due to the timing conventions of the government's employment surveys.