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The Journal Gazette

Metro jobless rate falls to 8.8%

Back-to-back drops fed by shrinking labor force

At first blush, two consecutive months of lower unemployment in metro Fort Wayne appears encouraging, but upon further review a troubling statistic emerges, a local economy analyst says.

The jobless rate in March was 8.8 percent, down from 8.9 percent in February, based on data the Department of Workforce Development released Friday. A year ago in March, the rate for the metro area was 8.6 percent.

Metro Fort Wayne is composed of Allen, Whitley and Wells counties.

John Stafford, director of the Community Research Institute at IPFW, said what bothers him is a labor force decline that suggests people have either given up looking for work or left the area.

“I wish I could give a definitive answer, but it would only be anecdotal,” he said, adding that retiring baby boomers could be a factor as well.

What Stafford does know is that northeast Indiana’s labor force shrank by 2,100 in March, compared with a month earlier, based on figures for the 10 counties the institute tracks: Adams, Allen, DeKalb, Huntington, LaGrange, Noble, Steuben, Wabash, Wells and Whitley counties.

The decline in the labor pool also was evident in numbers the Department of Workforce Development provided for the three counties in the Fort Wayne metro area. Those numbers show a March labor force of 201,582, compared with 203,519 in February.

“That jumped out at me right away,” Stafford said. “For the past few months, it seems that when we get good news it’s canceled out by the discouraging news.”

Ball State economist Michael Hicks believes Indiana’s latest employment report proves the national slowdown is beginning to be felt here. He also pointed to a shrinking labor market – or the number of eligible workers. Statewide, 11,000 private-sector positions vanished in March, compared with to February. The state’s unemployment remained unchanged at 8.7 percent.

“Nationally, full-time job creation numbers have been declining or stagnant throughout 2013,” he said in a statement. “It was inevitable that the factors weighing on the national economy, including higher payroll taxes, a lagging European economy and continued uncertainty regarding labor costs into 2014 as a result of the Affordable Care Act, would come home to roost in Indiana.”

Unemployment rates fell in 26 U.S. states in March even though job growth slowed. Rates fell mostly because many without work stopped looking for jobs and were no longer counted as unemployed. Sound familiar?

Regionally, March unemployment in Illinois and Ohio was unchanged at 9.5 percent and 7.1 percent, respectively. Michigan declined to 8.5 percent from 8.8 percent in February; and Kentucky increased to 8.1 percent from 7.9 percent.

Unemployment figures in the four Ohio counties bordering northeast Indiana – Defiance, Paulding, Van Wert and Williams – will be released Tuesday.

pwyche@jg.net

The Associated Press contributed to this report.

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