Kansas City Employment Forecast

Released  January 26, 2022 (See previous version)

In 2021, unemployment in Kansas City fell dramatically, from 6.6% down to 4.3%.  Indicative of continuing labor market adaptation and recovery from the ongoing novel Coronavirus pandemic, these trends are expected to continue throughout 2022 and 2023, halving the number of Kansas-Citians left unemployed in 2020.  There remains a degree of uncertainty as mutations of the virus such as the Delta and Omicron variants continue to place strain on the population, workforce, and economy through surges in infection rates.  Still, this strain is dampened by continually increasing access to and availability of vaccines and treatments, and the outlook appears increasingly optimistic.

Personal income grew 2.9% in 2021, and growth is forecasted to continue throughout 2022, 2023, and 2024.  This same trend is observed in personal income per-capita, which saw 2.1% growth in 2021 with higher rates forecasted for coming years.  It is expected to exceed $60,000 in 2022.

Employment growth is expected to be distributed unevenly across different sectors.  Trade occupations in Kansas City saw strong growth, adding 6,000 jobs in 2021, with solid growth forecasted for 2022 and 2023.  The addition of 2,800 (2.6%) and 2,500 (2.3%) jobs are expected for these respective years.  The largest component of Kansas City’s labor market, the service sector, grew by 1.4% in 2021, adding 3,600 jobs, and is expected to continue growth throughout 2023, making a net addition of 10,400 jobs since 2020.

The most significant component of job growth in the service sector comes from leisure and hospitality occupations, which have rebounded dramatically in 2021 (9.6% growth from 2020) alongside increasing vaccine availability and an ever-adapting labor force and job market.  Concurrent with this expansion, retail sales similarly bounced back in 2021, growing 12% relative to 2020, and are forecasted to continue growth, even after adjusting for inflation. As a result, retail sales in 2022 are expected to almost reach, and in 2023 to exceed, $1.4 billion.

Growth was more modest in the production sector throughout 2021, which gained 550 jobs that year.  However, growth rates are forecasted to increase in 2022, adding 2,000 jobs, with another 1,300 in 2023.  Similarly, the government sector gained 750 jobs in 2021 and is expected to continue growth in 2022 by a factor of 1.2%.  In 2023, government is estimated to grow by 1.1%, resulting in a net increase of 2,100 jobs since 2020.

[1] The Kansas City, MO-KS, metropolitan area includes Bates, Caldwell, Cass, Clay, Clinton, Jackson, Lafayette, Platte and Ray counties in Missouri and Johnson, Leavenworth, Linn, Miami, and Wyandotte counties in Kansas.