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Jobless rates in area hold steady

Shrinking labor force tempers economic growth

Published: Friday, July 25, 2014 1:15 a.m. CST

Unemployment rates fell in all 102 counties in Illinois for the first time since February 2011, according to the Illinois Department of Employment Security.

The year-over-year numbers throughout the Sauk Valley showed marked improvement, but May to June jobless rates, released by IDES Thursday, were relatively static.

“The encouraging part of the data was all metropolitan areas across the state had falling rates for the third consecutive time,” IDES spokesman Greg Rivara said.

“That’s significant, given the diversity across the state, geographically and economically,” Rivara said.

While IDES believes the improvement has been steady enough to constitute a trend, many argue that the numbers are also the result of discouraged workers who have stopped looking for jobs, and a shrinking Midwest labor force.

IDES spoke to that argument in a news release that came out with the June jobless numbers, staunch in its belief that employers are hiring more workers than 1 year ago.

“Blaming falling unemployment rates solely on discouraged workers ignores the reality of retiring baby boomers and shrinking labor force participating rate trends that began years before the recession even started,” IDES Director Jay Rowell said.

Numbers from the Bureau of Labor Statistics show that labor force participation in most Midwest states is dropping at a much higher rate than the national average since the recession in 2007.

In Illinois, the number of people not working and not looking for jobs has increased 3.7 percent since 2007, compared to a bounce of 2.8 percent nationally.

Last October, the nation’s labor force participation rate came in at 63.2 percent, a 35-year low. Retirements account for about half of those not working or seeking work.

While IDES concedes there are plenty of people out there who have given up on the job search, they believe economic improvement is also part of the falling jobless rates story.

“There is no doubt some people looking [for work] in May didn’t look in June because they were discouraged, but we also have a lot of baby boomers retiring,” Rivara said.

The Midwest ls also struggling with population loss. An influx of immigrants into many cities in America’s heartland is playing a key role in maintaining a competitive labor force. That labor dynamic is at play in the Quad Cities, according to U.S. Census data.

In Davenport, Iowa, for instance, between 2000 and 2010, the U.S.-born population had increased by only 0.8 percent, while the city’s labor force was propped up by a 141 percent increase in foreign-born workers during the decade.

Throughout the region, the trend of slight improvements month to month, and bigger drops in jobless rates continued.

Ogle County still has the area’s highest jobless rate, but it dropped from 8.3 percent to 7.9 percent in June. The number looks better, however, when compared with the 10.6 percent rate posted in June 2013.

Whiteside County inched upward one-tenth of a percentage point, moving to 7.4 percent last month.

Carroll County still lays claim to the area’s lowest jobless rate, dropping from 7.2 percent to 6.8 percent in June.

In Lee County, the June jobless rate dipped from 7.6 percent to 7.4 percent.

The rate in ag-heavy Bureau County was unchanged from May, remaining at 7.4 percent.

Statewide, June jobless rates dropped slightly, from 7.2 percent to 7.1 percent. Illinois still lags the nation in its post-recession recovery. The nation’s jobless rate, however, nudged upward, from 6.1 percent to 6.3 percent.

The recovery disparity between the U.S. and Illinois is something that state residents have grown accustomed to.

“Historically, Illinois has been above the national rate in good times and not so good times,” IDES spokesman Greg Rivara said. “We expect it’s going to be like that going forward as well.”

None of the numbers released by IDES Thursday have been seasonally adjusted, an additional process that more accurately compares months with inherent differences, oftentimes driven by weather.

Going forward, IDES believes geopolitical concerns could play a big role in sustaining economic growth.

“Consumer confidence drives two-thirds of economic activity,” Rivara said. “What’s going on in Kiev, the Middle East, and the general economy in that side of the world will affect business decisions in Illinois.”

Area jobless rates

June 2014; May 2014; June 2013

Whiteside County 7.4%; 7.3%; 9.7%

Lee County 7.4%; 7.6%; 9.2%

Ogle County 7.9%; 8.3%; 10.6%

Carroll County 6.8%; 7.2%; 9.0%

Bureau County 7.4%; 7.4%; 8.9%

Illinois 7.1%; 7.2%; 9.8%

U.S. 6.3%; 6.1%; 7.8%

Source: Illinois Department of Employment Security

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