Arizona Ranks Third in U.S. for Job Growth in First Quarter of 2026
Arizona's economy continued to post strong gains during the first quarter of 2026, ranking third in the nation for percentage job growth among all 50 states, according to the Spring 2026 Arizona Economic Update released by the Arizona Office of Economic Opportunity (OEO).
The report shows that Arizona added approximately 15,500 nonfarm jobs between January and March, bringing total statewide nonfarm employment to 3.27 million. The increase represents a 0.5% quarterly growth rate, placing Arizona among the nation's top-performing labor markets.
Governor Katie Hobbs praised the state's economic resilience, noting that Arizona continues to attract businesses and create jobs despite national economic challenges.
"Arizona's economy continues to grow and gain momentum," Hobbs said. "We remain committed to attracting new investment, creating quality jobs, and ensuring that every Arizona family has the opportunity to succeed."
Labor market data showed 118,700 job hires during the quarter, an increase of roughly 2,700 compared with the previous quarter. At the same time, job separations fell to 110,000, a decline of about 6,300, signaling continued strength in workforce retention.
Arizona also ranked 11th nationally in year-over-year private-sector job growth from April 2025 to April 2026, according to a separate OEO analysis.
Among industry sectors, Private Education and Health Services led annual job gains, adding 11,800 positions, a 2.2% increase from a year earlier. Growth was fueled by Arizona's expanding population and rising demand for healthcare and social assistance services.
Other Services added 1,900 jobs, growing 1.8% year over year, while Natural Resources and Mining posted one of the state's fastest growth rates, increasing by 7.1% and adding 1,100 jobs. Analysts attributed the sector's performance to strong demand for copper and continued investment in energy and electrification infrastructure.
Mary Foote, Director of the Arizona Office of Economic Opportunity, said the data demonstrates the state's continued labor market strength.
"What this report shows is that Arizona's labor market remains resilient and continues to grow in sectors that matter most to Arizona families," Foote said. "We will continue using this information to develop workforce strategies that connect Arizonans with meaningful economic opportunities."
Economist Jim Rounds, CEO of Rounds Consulting Group, said the positive momentum continued into April and reflects a labor market moving toward balance rather than decline.
"Job growth remains broad-based across key industries, wages continue to improve, and labor force participation has stabilized," Rounds said. "These trends provide a solid foundation for cautious optimism as Arizona moves into the summer months."
The report concluded that Arizona's labor market continues to benefit from strong population growth, sustained business investment, and ongoing expansion in healthcare, advanced manufacturing, and professional services.