Florida's unemployment rate dropped to 4.5 percent in August, marking the third straight month of decline after nearly a year of increases, according to data released Friday by the Department of Commerce. The August figure represents 502,000 jobless Floridians out of a workforce of 11.1 million, which is 12,000 fewer unemployed people than the previous month. However, state economists have warned that an uptick is expected before year's end.
The state's jobless rate has fallen by 0.1 percentage point each month since June, when it peaked at 4.6 percent in July and 4.8 percent in both May and June. Florida's rate remains above the national average of 4.1 percent, a pattern that has persisted throughout the year. Compared to a year ago, when the workforce stood at 11.08 million and 444,000 were unemployed, the current rate is 0.5 percent higher. Job gains over the past year have been concentrated in education and health services, which now accounts for roughly 1.6 million workers, with health care and social assistance contributing 41,300 of the estimated 39,600 new positions in that category. The leisure and hospitality sector added 13,400 jobs over the year, though all growth came from entertainment and recreation while hotel and food service workers dropped by 2,900 positions annually. Construction lost 100 jobs from July to August but remains up 2,100 on the year, while manufacturing fell 900 positions in August but is up 2,300 annually. Financial activities dropped by 400 jobs in August and 14,300 over the year.
State economists project the unemployment rate will climb to 4.9 percent in the current fiscal year before falling to 4.7 percent in 2027-28 and then stabilizing around 4.1 percent near the end of the forecast period, according to the Economic Estimating Conference. Amy Baker, coordinator of the Legislature's Office of Economic & Demographic Research, told the Joint Legislative Budget Commission that "we're looking at employment growth that only is to exceed, one-time, 1 percent, but mostly stays below that one percent." She added that over the next four years, the state expects "4 percent or more in the average annual wage for Florida." State economists place "full employment" at roughly 4 percent, a threshold Florida stayed mostly below from late 2021 through the end of 2025.
The uptick in wages has been driven in part by a 2020 voter-approved constitutional amendment that raises the minimum wage by $1 annually. On September 30, the hourly rate will reach $15, or $11.98 for tipped workers, after which increases will be tied to inflation. That stands in sharp contrast to the federal minimum wage of $7.25 per hour, which hasn't changed since July 2009. The latest long-range forecast from state economists noted that worker pay has been improving in what's historically been viewed as a "low-wage" state, even as employment growth is expected to stay just under 1 percent each year. Regional unemployment varies widely across Florida, with the Miami-Fort Lauderdale-West Palm Beach metro area holding the lowest rate at 3.7 percent, unchanged from July to August, while the Wildwood area including The Villages maintained the state's highest rate at 7.9 percent.
State economists expect the unemployment picture to remain largely unchanged in the near term, with modest employment growth and gradual wage improvements defining Florida's labor market. The anticipated rise to 4.9 percent unemployment in the current fiscal year reflects the state's positioning above the "full employment" threshold economists use as a benchmark. For workers in education, health care, and entertainment, job gains continue to offset losses in sectors like finance and food service, creating an uneven recovery across industries. Florida's workforce of 11.1 million will likely see steadier wage growth than job growth over the coming years, a shift that reflects both the minimum wage increases and broader economic trends in a state long characterized by lower pay.