Valley unemployment rate rises, as labor force shrinks

By Tom McParland


As Ohio continued to slowly add jobs in September and October, the Mahoning Valley saw jumps in unemployment and a net loss of 2,000 in its workforce.

The seasonally unadjusted figures, released Tuesday by the Ohio Department of Job and Family Services, show the Valley’s unemployment rate spiked to 8.0 percent in September, up from 7.3 percent a year ago. October’s rate came in at 7.7 percent, an increase of 0.4 percent from 2012.

In September, the number of unemployed in the Valley jumped by 1,800 from a year ago. There was a less-severe bump of 1,200 in October.

In October, the Valley’s workforce shrank by 2,000, down from 263,000 last year.

George Zeller, a Cleveland-based economist, said the decline reflects a growing number of “discouraged workers” who have been unemployed for so long that they stopped looking for jobs.

The county-level unemployment figures, however, are not seasonally adjusted, meaning they don’t account for jobs created or lost during the summer and holiday months, as the state data do.

Cuts to government spending trimmed more than 8,000 state and local government jobs across Ohio in September and October.

According to Mekael Teshome, an economist for PNC Bank, that has strained the rest of the economy, causing the private sector to “shoulder the burden” of the economic recovery.

“We’re not firing on all cylinders,” he said.

The state’s manufacturing sector — key to the Valley’s economy — continued its recent slowdown, shedding 300 jobs statewide in two months.

“That is very critical to the Mahoning Valley,” which is home to General Motors’ Lordstown plant and other industries that support it, Zeller said.

In the early economic recovery, strong production here helped to mitigate some of the damage from the Great Recession, but manufacturing has leveled off lately.

“It’s going to grow at a slow pace,” Teshome said.

Meanwhile, Ohio continued to add jobs at a rate much below the national average.

“Overall, I still think we’re in the midst of a persistent and moderate recovery,” said Teshome, adding he expects to see similar trends extend into next year.

As the state hit 16-consecutive months of subpar job gains in October, the gap between Ohio’s rate of job growth and the national average widened.

In August, Ohio was adding jobs at a clip of 0.75 percent, compared with 1.67 percent nationally. But the state pace dropped to just 0.52 percent in October, as the national average rose to 1.70 percent.

“We are not adding jobs quickly enough,” Zeller said.

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