Not all boats are continuing to rise in this labor market

It has been a while since we looked at state and county labor market changes. So, I pulled up the number of persons employed and the number unemployed as reported by the Indiana Department of Workforce Development and the U.S. Bureau of Labor Statistics.

The latest month I found was May 2019 for counties, June for states. But I dare not use unmatched months for fear some partisan critic would say I was cherry-picking the data by not using the same month. Of course, I’ve been doing this long enough to realize it doesn’t matter. Critics will carp regardless of the starting and ending points of any analysis.

Anyway, from May 2017 to the same month in 2019, the number of persons employed rose by 3.7 million (2.4 percent) in the U.S. During the same time, the number unemployed fell by 1.1 million (a healthy decline of 16.7 percent).

That means the labor force, which is the sum of the employed and the unemployed looking for work, rose by 2.7 million. (Don’t panic; the numbers are rounded, not incorrect.) This is what most folks think is how things should be. More people working reduces the number looking for work and also draws into the labor force people who previously did not have jobs nor were job-hunting.

Indiana was one of the 34 states in this happy condition. Job holders increased by 33,000 while job-seekers declined by 9,000, with the labor force growing by 24,000. But we trailed the nation in all three measures as our job holders grew by 1.0% (U.S. = 2.4%), our number unemployed declined by 8.0 percent (U.S. = -16.7%) and our labor force rose by 0.7% (U.S.=1.7%).

If any one of the Happy-talk Hoosiers noticed this deficiency, it would be surprising. However, it would be astonishing, if they also recognized that 44 (not half of Indiana’s 92 counties) were in this benighted condition with the numbers employed and the numbers in the labor market rising while the numbers unemployed fell.

In total, 53 counties did see increases in the number employed. But this left 39 of our counties with a decrease in the number of employed persons. Hardly the kind of news that makes it into press releases.

In a simplistic world, growth of employment would wipe out unemployment. However, many other factors can intervene. Strong increases in employment opportunities can provide jobs for the unemployed and attract workers back into the labor force. Simultaneously, people often move to where jobs are increasing and away from less attractive areas.

The case of New Jersey is instructive. That state gained 38,500 employed persons and cut the number unemployed down by 64,500. The net effect: NJ saw its labor force decline by 26,000. Did they retire and/or move? Probably the latter since Jersey is rarely cited a retirement mecca.

Morton Marcus is an economist, writer and speaker who may be reached at [email protected].