According to a federal survey of 60,000 households, Kentucky’s seasonally adjusted unemployment rate fell in April to 5 percent, the lowest in the state since June 2001. The unemployment rate in the commonwealth is now 2 percent lower than at this point last year, and 3 percent lower than this time two years ago.
“The labor market has improved steadily, and a 5 percent unemployment rate is quite a milestone,” said economist Manoj Shanker of the Office of Employment and Training, an agency of the Kentucky Education and Workforce Development Cabinet. “The Fed announced last month that the normal long-run unemployment rate, or full employment, is between 5 percent and 5.2 percent, so we are at the lower end of that target range. In addition, we have now had nine straight months where unemployment rates in Kentucky have been lower than the national average.”
The survey found that employment increased by 4,984 in April, marking the eighth straight month with positive movement. The number of unemployed also decreased by 1,394, continuing a downward trend over every month in the last two years.
While Kentucky’s unemployment rate plummeted in 2014, observers cautioned that those numbers were not as good as they appeared, as the state’s total workforce declined every month in both 2013 and 2014, with fewer people actively searching for work. That has not been the case over the past four months, as Kentucky’s workforce increased by 3,590 individuals in April and by a total of more than 23,000 since the beginning of the year.
Another positive sign for the economy since the beginning of the year is the rapid increase in employed individuals. Their ranks have grown by more than 30,000 since December.
A separate federal survey of businesses showed that non-farm jobs increased by 7,000 in April, up 33,800 positions from this time last year.
“The pace of job growth is up 77 percent for the first four months of 2015 compared to 2014,” said Shanker. “We have to go back to March 2000 — during the dot-com economy — to see that type of growth.”
In the federal survey of employment by sector, Kentucky was found to have gained 3,100 government jobs in April, most of which came from educational institutions and state-owned hospitals. The construction sector had the second-largest gain of 1,900 jobs.
Health care jobs increased by 1,600 in April — an increase of 5,000 year over year — while manufacturing jobs grew by 1,100, amounting to a 4,700-job increase in a year’s time.
“The general economic recovery and a slow but steady growth in wages has caused consumer spending and demand to rise,” said Shanker. “The effect can be clearly seen in a sharp increase in manufacturing jobs. The only concern is that in the long run, the strong dollar can squelch export demand for Kentucky goods.”