Regional Data Page Shows How Economy Varies Across the U.S.

To show how conditions related to the Fed’s dual mandate of price stability and maximum employment vary across the nation, the SF Fed launched a new data page—Regional Indicators for Labor Markets and Prices. The page presents a range of indicators related to labor markets and earnings for the 50 states and the District of Columbia, as well as inflation data for selected metropolitan areas within the Federal Reserve’s 12th District.

Importance of regional data on labor markets and prices

Data—particularly on labor markets and prices—help guide monetary policy decisions. The Federal Reserve has a dual mandate to promote the goals of price stability and maximum employment. While these goals refer to national prices and employment, the U.S. economy is big and varies widely, making it important for the Federal Reserve to understand differences across regional economies. In addition, the U.S. Federal Reserve System includes 12 regional Federal Reserve Banks. Each of the Reserve Banks plays a significant role in setting monetary policy, and those policy decisions are informed in part by regional economic conditions.

To see how conditions related to the dual mandate vary across the nation, the SF Fed provides regional labor market indicators and measures of price and earnings growth in its new data page, Regional Indicators for Labor Markets and Prices. The page includes data for the 50 states and the District of Columbia, with a focus on the 12^th District, the largest of the Federal Reserve Districts, covering nine western states and 37% of U.S. geographic area.

Regional variation in labor market data

Labor market conditions are measured by a multitude of economic indexes with different ways of viewing the interactions between the supply of and demand for workers. Labor supply consists of people currently working (employed) and those who don’t have a job but are available and actively looking for work (unemployed).

When the economy is doing well, the number of people who are employed goes up and the share of workers out of a job is low. Consequently, our data page shows two Bureau of Labor Statistics (BLS) indicators that track these concepts across states: the employment growth rate from the BLS establishment survey and the unemployment rate from the BLS household survey.

Another way to learn more about labor market conditions is to assess the tightness of the labor market by comparing the number of vacant positions employers would like to fill (vacancies) to the number of people looking for jobs (unemployed). The resulting vacancy-to-unemployment (V–U) ratio measures the degree of labor market tightness.

For example, if jobs are plentiful to the point where there are more vacancies than unemployed workers, the V–U ratio is greater than one, indicating a relatively tight labor market. Usually, tight regional labor markets tend to have lower unemployment rates, and tight conditions are more typically seen during periods of economic expansion than during recessions.

As of November 2024, the national V–U ratio was close to 1, indicating a relatively balanced labor market. However, V–U ratios vary widely across the United States, from a very tight labor market reading of 2.6 in South Dakota to a relatively slack measure of 0.7 in California. Figure 1 highlights these differences in regional labor market conditions.  

Figure 1
Vacancy-to-unemployment ratios by state

Regional variation in price and earnings growth

Just as labor market conditions vary across the United States, so does the price growth of consumer products. While the Federal Reserve’s preferred gauge of inflation is measured using the headline personal consumption expenditures (PCE) price index, we rely on consumer price index (CPI) inflation, which is closely correlated and includes some geographic breakdowns. CPI inflation is available for 23 metro areas, eight of which are in the 12^th District.

Adapting the methodology on the SF Fed’s CPI Inflation Contributions from Goods and Services data page, we can break down headline metro area CPI inflation into the contributions from shelter, food, energy, and the remaining categories of goods and services excluding food, energy goods and services, and shelter services.

Figure 2 shows the most recent breakdowns for eight metro areas in the 12^th District for which data are available. Both inflation rates and their composition differ across metro areas. For example, even though overall inflation rates in San Francisco and urban Alaska were similar, shelter inflation contributed less in Alaska than in San Francisco. In a supplemental file on our data page, we show how these inflation contributions have evolved over time in each of the 12^th District metro areas shown in Figure 2.

Figure 2
Contributions to 12-month headline CPI inflation: Selected 12th District metro areas

This variation in inflation becomes more meaningful when considered together with variations in earnings growth for workers. Our regional data page includes a map with information about the 12-month percent change in earnings growth for all 50 states and the District of Columbia.

We can compare inflation data for the eight shown metro areas in the 12^th District to their state’s overall earnings growth rate. This gives a general indication of whether residents’ purchasing power is keeping up with the pace of overall price increases.

For example, across the California metro areas, inflation ranged from 1.1% to 3.4% in November and December, and earnings growth in the state overall was 3.9% in December. This indicates that, on average, earnings have been keeping up with price increases recently.

To see additional maps and figures with information about labor market conditions and earnings across the country and prices in the 12^th District and to download the data, see our Regional Indicators page. The data will be updated at the beginning of every month.