May 19, 2023
May 19, 2023
Low rate masks long-standing labor force weakness
The takeaway: In April, Ohio’s unemployment rate reached 3.7%, which is the state’s lowest recorded rate since the data series started in 1976. This is a welcome milestone in the state’s continuing recovery from the COVID recession. Preliminary data also suggest that Ohio’s improved unemployment rate over the last 12-months has been driven by increased employment rather than a decline in the labor force. The labor force is the number of people working or actively seeking work. Ohio has struggled against a contracting labor force for many reasons and for many years. Even with the recent improvements, Ohio’s labor force is missing more than 139,000 people since the COVID close-down (Feb. 2020). The state is also missing more than 80,000 employed people since that time.
The jobs numbers: Seasonally adjusted data also released today by the Ohio Department of Job and Family Services (ODJFS) show that Ohio employers restored 18,100 jobs over the month, a tremendous one-month increase. Should this growth hold through the coming revisions, it leaves the state just over 5,000 jobs shy of our pre-COVID total. This is very positive for Ohio given the pressure created by Federal Reserve interest rate increases. Sectors that did not see improvement in April included information (-600) and local government (-500).
“People stop working or looking for work for many reasons,” said Policy Matters Ohio executive director, Hannah Halbert. “People could be retiring, seeking skills and education, family care demand may prevent work, or they could also be unable to continue working due to health and ability changes. Also, they simply could be struggling to find work where they live. If the state legislature wants to ensure a robust and far-reaching recovery, the state budget must include support to address the pressures acting against labor force participation.”
“Restoring the training and pay supports to the child care workers that were eliminated by the House budget bill would encourage more people to enter that field, as would increasing reimbursement rates to match the cost of caring for kids,” said Halbert. “Addressing Medicaid redeterminations that threaten access to health care as well as increasing supports for mental and behavioral health, would help people to be healthy enough to work. Paying direct care workers a living wage would keep people committed to careers in the helping professions.”
Halbert continued, “Ohio’s labor force and economic health cannot be separated from the investments made in the state budget. More tax cuts for the wealthiest only removes the resources needed to help Ohioans be full participants in the economy.”
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