Researcher George Zeller still finds “job destruction” – his term – continues in Ohio. However, he gleans some “optimistic findings” in job figures for the first month of this new decade.
Here is his entire message about the first week of January 2010 and the jobs picture in Ohio:
Since it is Thursday, we have an updated Economic Indicators analysis of the level of new unemployment claims in Cleveland-Akron-Lorain-Elyria and in Ohio. Today's new data are for the first week in January, and thus the first week of the first quarter of 2010 and the first week of calendar 2009. The newly updated full report is now available on the internet at
http://www.nacs.net/~georgez/newclaims010210.pdf [1]
This report is designed to measure the point at which Ohio's lengthy 2000s recessionary contraction in its labor market finally comes to an end as a result of resumed job growth within the state. This week's report finds that job destruction continues in Ohio, and that the lengthy 2000-2009 period of job loss in Ohio has still not come to an end. But, there are once again some noteworthy and somewhat optimistic findings in this week's update to the level of new unemployment claims in Ohio.1. Ohio's trend in new unemployment claims finally is consistently showing a year over year decline in the state's four week moving average of new unemployment claims. The current four week moving average of Ohio new unemployment claims during the first week of January 2010 is 21,253, a substantial -30.4% decline in comparison to the extremely high 30,521 new unemployment claims that Ohio had during the first week of January in 2009. This decline has now been sustained throughout the fourth quarter of 2009 and the first week of 2010. It is the first such decline that Ohio has experienced during the decade, and it therefore is very good news. But, the current level of new unemployment claims nevertheless remains above a normal "job growth" level on a statewide basis.
2. Despite the year over year decline, Ohio's level of new unemployment claims remains 12% above a "job growth" level represented by the last year when Ohio experienced employment growth in 1999. When Ohio's economy is generating employment growth, it is normal during the first week of January for the state to experience 19,018 new unemployment claims. This week's reading of 21,253 remains quite high and well above what it should be during the first week of January during years when Ohio is generating employment growth. So, despite the welcome year over year decline in new unemployment claims in Ohio, it is clear that Ohio is still losing jobs at a substantial pace, and that the 2000s recession is still not yet over in Ohio's labor market.
3. Unfortunately, 57 of Ohio's 88 counties still have current levels of new unemployment claims that exceed their 1999 "job growth" levels. This figure is a substantial improvement of 16 counties when compared with the findings from last week's data. It is clear that Ohio's current job losses are still a literally statewide phenomenon. Despite the slowing of new unemployment claims in comparison with last year's level, the current layoff levels clearly signify job loss on a virtually statewide basis in Ohio last week. The 31 counties that are exceptions are overwhelmingly small rural Appalachian counties. Only two Ohio urban regions have returned to a "job growth" level of new unemployment claims, Youngstown-Warren and Canton.4. Columbus passed Cincinnati this week to restore its unwanted distinction as the Ohio urban metropolitan area with the most elevated level of new unemployment claims above normal "job growth" levels at this time of year. Surprisingly, Ohio's most elevated levels of current new unemployment claims are in Columbus, while the second most elevated levels of new unemployment claims are in Cincinnati. The third highest current levels of currently elevated job loss are in Dayton-Springfield, with Toledo ranking fourth highest. In this week's update, Youngstown-Warren has the state's least elevated level, a slightly better performance than Canton had. In fact, both Youngstown-Warren and Canton have returned to a low "job growth" level of new unemployment claims this week. These rankings are relative measures, since most of the entire state in 57 counties is still currently suffering job destruction from layoffs.
5. Ohio is in the season of the year when new unemployment claims are at their highest levels every year. It is not widely known, but during the holiday season between Thanksgiving and Christmas and extending into January, Ohio always experiences more layoffs than it suffers at any other time of the year. Despite the normally very high level of layoffs at this time of year, Ohio's new unemployment claims remain 12% higher than even that normally elevated seasonal level.
6. The data on new unemployment claims are unusually difficult to interpret in January, when even during years of job growth there are very large numbers of layoffs. This quirk led to a "false positive" reading in 2008, when in mid-January it appeared that the recession might be ending soon in Ohio. Very large levels of layoffs in late January 2008 and all subsequent months since then killed that optimistic quirk two years ago. Data for remaining weeks of the winter in 2010 will be unusually important, for this reason.
The fact that Ohio's year over year level of new unemployment claims finally is declining for nine consecutive weeks relative to last year's extraordinarily high levels for the first time in a decade is clearly good news. But, the fact that Ohio's level of new unemployment claims remains 12% higher than what it should be even at this time of year when layoffs normally increase means that Ohio once again lost jobs last week. That is clearly very bad news in a state that has lost more than 525,000 jobs and more than 10% of the jobs that Ohio had in 2000. Overall, there are mixed findings this week in the new unemployment claims data, and all of those findings are important. The findings are unusually bad in Columubus and Cincinnati, but they are more favorable in Youngstown-Warren and Canton.
George Zeller, Economic Research Analyst
http://www.nacs.net/~georgez/homepag2.htm [2]
Links:
[1] http://www.nacs.net/~georgez/newclaims010210.pdf
[2] http://www.nacs.net/~georgez/homepag2.htm