SOUTHERN INDIANA — The latest state unemployment report is a mixed bag for Indiana.

While the state saw one of the largest declines in jobless rates in the nation from April to May, Indiana is still down more than 300,000 jobs from pre-pandemic levels.

According to the U.S. Bureau of Labor Statistics report released Friday, Indiana’s May unemployment rate was 12.3 percent, down from 17.5 percent in April. Indiana and Kentucky were among the top three states in the nation for unemployment rate decreases from month-to-month. Kentucky’s rate fell from 16.6 percent in April to 11 percent last month.

Indiana gained 87,500 jobs in May, but the state shed more than 400,000 positions in April.

“So while the 87,500 jobs gain is an impressive number, we still have a long way to go to get back to pre-pandemic levels,” said Uric Dufrene, Sanders Chair in Business at Indiana University Southeast.

In terms of labor force, Indiana saw an increase of 111,000 last month. Kentucky wasn’t as fortunate, as its labor force actually fell in May.

“This is not a positive development for Kentucky,” Dufrene said. “A declining labor force size suggests that workers are discouraged and have dropped out of the labor force altogether.”

Leisure and hospitality saw an increase of 35,000 jobs in Indiana in May, primarily due to the partial reopening of restaurants. But again, the sector is still well behind pre-pandemic levels.

“While the 35,000 is a significant number, it is a small share of the 116,000 jobs that were lost in April,” Dufrene said.

Manufacturing jobs decreased by 77,000 in Indiana in April, but saw an increase of 18,000 positions last month. The state should continue to see gains in manufacturing, but it’s unlikely the sector will reach levels before COVID-19 struck by the end of the year, Dufrene predicted.

One of the more concerning aspects of the report for Dufrene is the lack of gains in Indiana’s business and professional sector. About 37,000 jobs were shed in the sector in April, the bulk of which came from administrative and support services and employment services, yet only 1,700 gains were reported for May.

“Employers are likely calling their permanent employees back first,” Dufrene said. “We will see employment services increase when the economy shows stronger growth, and companies begin to expand again.”

Indiana’s jobless rate for May was below the national average of 13.3 percent.

“The brightest spot for Indiana was the big increase in the size of the labor force, and larger drop in the number of unemployed,” Dufrene said.

According to the Indiana Department of Workforce Development, new claims for unemployment in Floyd County for the week ending June 13 were 198. Initial claims peaked in Floyd County in late March with more than 1,200 claims in one week.

Clark County saw over 2,000 initial unemployment claims for the week ending March 28. There were 318 new unemployment claims in Clark County for the week ending June 13.

As of June 6, there were 3,198 people in Clark County and 1,875 in Floyd County claiming continued unemployment benefits.

Wendy Dant Chesser, president and CEO of One Southern Indiana, said area manufacturers have different experiences when it comes to production during the pandemic.

“The need for their product for some is very high, so they’re doing very, very well. Others have product limits on any growth opportunities at the moment, and they have some concerns,” she said, adding that other manufacturers are somewhere in the middle.

A general rule of thumb is that most area manufacturers are between 55 and 75 percent of their projections, she continued.

Those industries connected to the auto sector could see the effects of the pandemic later than many businesses because their production is typically staggered about two months behind projections and sales, Chesser said.

“As the lag starts happening, they’re going to be shifting and the impact on them is going to be later in the projection cycle than it was at the beginning,” she said.

There are jobs available in the region, and she encouraged people to contact their local WorkOne office and review their help wanted bank online.

One of the primary concerns businesses have expressed locally is a need to be able to market and advertise their services, Chesser said. With the pandemic still limiting operations in some capacities, she said it’s a challenge for businesses to reach customers to let them know if they’re open and at full service.

Though she would like to see another month or two of positive job reports before believing employment is on the right track, Chesser said she’s optimistic.

“One positive month does not make a trend but it sure beats another negative month,” she said.
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