Unemployment numbers down
SALEM-The unemployment news is much improved with the latest state data, according to Cleveland economic Research George Zeller.
Ohio has extended a new streak to five consecutive weeks of job growth levels of new unemployment claims that are not currently elevated, Zeller said of the unemployment numbers for the last week of August.
“Unfortunately,” said Zeller, a 1967 Salem High School graduate, “it was not clear if the erratic timing in recent years of the annual (August) retooling process in the automobile industry was the cause of the improvement, or whether the three-week streak of improvement is genuine.”
Zeller said that September unemployment claim numbers will be needed to provide a definitive answer to that question.
Ohio’s 6,708 new unemployment claims for the fourth week of August was still 8.3 percent lower than the 7,317 new unemployment claims during third week of August 1999, the last year when Ohio had unambiguous job growth for the entire year.
That means, Zeller said, the week was in the “job growth” range of new claims that is not currently elevated above normal levels, although the strength of that slowed considerably this week in comparison to last week’s level.
Zeller uses the benchmark year of 2000 because his reports are designed to measure the point at which Ohio’s lengthy 2000s recessionary labor market contraction will conclude as a result of the end of job destruction.
His data tracks employment losses because it is directly associated with payroll earnings losses and also causes declines in other measures of the business cycle, notably revenues generated by tax streams at various levels of government.
The income tax and the sales tax are particularly subject to trends in the business cycle.
Therefore a determination economic indicators: Job and earnings trends that update the point at which the impact of the 2000s recession finally disappears in Ohio’s labor market is an extremely important issue, he said.
The latest data is less useful than usual because of the inconsistent timing from year to year in the automobile industry retooling layoffs, he said, another seasonal distortion, similar to the Christmas season, he said.
Every year in January and early February the level of new unemployment claims soars dramatically, since there are more layoffs every year during the post-holiday winter period than there are at any other time of year, both during recessions and economic recoveries.
The past week’s data, while slightly weaker, was still highly favorable in Ohio for the fifth consecutive week, while nationwide numbers were also dramatically positive this week, Zeller said, adding, “It will be very important to see figures for early September to see whether this favorable Ohio trend is genuine, or whether it has mainly been caused by the annual August summer distortion in the data.”
The favorable Ohio data are similar to positive data released Thursday at the national level by the U.S. Bureau of Labor Statistics.
Despite the improved numbers, Zeller said it is “still is not yet conclusively demonstrated that Ohio has moved from its ongoing very slow recovery to a badly needed increasingly vigorous labor market recovery.”
He said the speed of Ohio’s recovery remains “too slow” and a “lingering weakness,” consistent with the job data in July, and currently shows a streak of 21 consecutive months in which Ohio’s job-growth rate ranked below the national average.
“Even more troubling is the fact that Ohio lost 24,400 jobs in July, the largest figure for job losses during July 2014 that was suffered by any USA state,” he said, but noted the improvement in last week’s new unemployment claims “is a potentially favorable leading indicator in advance of new Ohio job data for August scheduled for release on September 19 that will measure whether Ohio’s continually below average recovery is finally improving to national norms.”
Zeller said that since Ohio has still not recovered 146,000 jobs that it lost as a result of the deep and lengthy 2007-2009 national “Great Recession,” it is encouraging to see the data on new unemployment claims that measure a continuing return to job growth and not elevated levels of new unemployment claims in Ohio for five consecutive weeks.
“Further improvements in subsequent weeks are still urgently needed so that 146,000 Ohio workers who lost their jobs during the 2007 Great Recession will be able to find a new job,” he said.