FRANKFORT, Ky. (May 21, 2015) — Kentucky’s unemployment rate continued to decrease as it fell to a seasonally adjusted preliminary April 2015 level of 5 percent from a revised 5.1 percent in March 2015, and well below the national rate, according to the Office of Employment and Training (OET), an agency of the Kentucky Education and Workforce Development Cabinet.
“The labor market has improved steadily and a 5 percent unemployment rate is quite a milestone,” said economist Manoj Shanker of OET. “The Fed (Federal Reserve System) 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 state rate in April 2015 was 2 percentage points below the 7 percent rate recorded in April 2014, and was the lowest jobless rate since June 2001 when it was 5 percent.
The U.S. seasonally adjusted jobless rate in April 2015 fell to 5.4 percent from 5.5 percent in March 2015, according to the U.S. Department of Labor.
Labor force statistics, including the unemployment rate, are based on estimates from the Current Population Survey of households. It is designed to measure trends rather than to count the actual number of people working. It includes jobs in agriculture and those classified as self-employed.
In April 2015, Kentucky’s civilian labor force was 1,996,657, an increase of 3,590 individuals compared to the previous month. Employment was up by 4,984, and the number of unemployed decreased by 1,394.
In a separate federal survey of business establishments that excludes jobs in agriculture and people who are self-employed, Kentucky’s seasonally adjusted nonfarm employment increased by 7,000 jobs in April 2015 from the month before, and jumped by 33,800 positions since April 2014.
“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.”
Nonfarm data is provided by the Bureau of Labor Statistics’ Current Employment Statistics program. According to this survey, eight of Kentucky’s 11 major nonfarm North American Industry Classification System (NAICS) job sectors registered gains in employment, while three declined from the previous month.
Employment in the government sector, which includes public education, public administration agencies and state-owned hospitals, added 3,100 jobs in April 2015 and 3,100 positions since last April 2014.
“State government jobs were up by 1.7 percent from March 2015. But only about one-third of these jobs are in administration, the rest are in state educational institutions and hospitals,” said Shanker.
Employment in the construction sector jumped by 1,900 in April 2015 from a month ago. Since April 2014, employment in construction has risen by 1,700 positions.
“The strongest driver for this sector is heavy and civil engineering construction which includes highways and bridges,” said Shanker.
Employment in the educational and health services sector increased by 1,700 positions in April 2015, and posted a robust gain of 6,500 jobs over the year.
“Healthcare jobs, which account for 15 percent of all nonfarm employment in Kentucky, were up by 1,600 jobs for the month and by 5,000 from a year ago,” Shanker said. “These jobs, especially ambulatory care, are growing in response to expanded access to Medicaid services.”
Kentucky’s manufacturing sector grew by 1,100 jobs in April 2015. Since April 2014, employment in manufacturing has ballooned by 4,700 jobs or 2 percent. Durable goods account for almost two-thirds of the manufacturing sector and grew by 4.5 percent from a year ago, whereas nondurable goods jobs declined by a little over 2 percent.
“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.”
The state’s trade, transportation and utilities sector jumped by 1,100 jobs in April 2015. This is the largest sector in Kentucky with more than 380,000 jobs that account for one-fifth of all nonfarm employment. Since April 2014, jobs in this sector have expanded substantially with the gain of 6,200 positions. Retail trade added 2,200 jobs over the year, wholesale trade declined by 600 jobs, while transportation and warehousing expanded by 4,600 positions.
The information sector increased by 200 jobs in April 2015. This segment has declined by 100 positions since April 2014. The industries in this sector include traditional publishing as well as software publishing; motion pictures and broadcasting; and telecommunications.
Mining and logging sector jobs rose by 200 in April 2015. The industry has lost 800 jobs since last April.
Employment in the other services sector, which includes repairs and maintenance, personal care services, and religious organizations, was up by 100 in April 2015 from a month ago. This sector has gained 700 jobs from a year ago.
The leisure and hospitality sector lost 100 positions in April 2015. Since April 2014, this sector has grown by 4,500 jobs. This sector includes arts, entertainment, recreation, accommodation and food services.
The financial activities sector fell by 700 jobs in April 2015. The sector has gained 600 positions over the last 12 months.
Kentucky’s professional and business services sector declined by 1,600 positions in April 2015 from a month ago. The sector has grown by 6,700 since last April. This category includes establishments engaged in services that support the day-to-day activities of other organizations, including temporary employment services and payroll processing.
“The month-to-month data for temp jobs tends to fluctuate because businesses tend to hire temps into full-time positions,” said Shanker.
Civilian labor force statistics include nonmilitary workers and unemployed Kentuckians who are actively seeking work. They do not include unemployed Kentuckians who have not looked for employment within the past four weeks.
Kentucky’s statewide unemployment rate and employment levels are seasonally adjusted. Employment statistics undergo sharp fluctuations due to seasonal events, such as weather changes, harvests, holidays and school openings and closings. Seasonal adjustments eliminate these influences and make it easier to observe statistical trends. However, because of the small sample size, county unemployment rates are not seasonally adjusted.
Learn more about Kentucky labor market information at kylmi.ky.gov.