Kentucky’s jobless rate drops to 5 percent in June 2016


Kentucky’s seasonally adjusted preliminary unemployment rate for June 2016 dropped to 5 percent from a revised 5.1 percent in May 2016, according to the Office of Employment and Training (OET), an agency of the Kentucky Education and Workforce Development Cabinet.

The preliminary June 2016 jobless rate was 0.3 percentage points lower than the 5.3 percent rate recorded for the state in June 2015.

The U.S. seasonally adjusted jobless rate for June 2016 was 4.9 percent, 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 June 2016, Kentucky’s civilian labor force was 1,973,887, a decrease of 6,448 individuals compared to the previous month. Employment was down 4,559, and the number of unemployed decreased by 1,889.

“Our unemployment rate is at a reassuring 5 percent,” said economist Manoj Shanker of the OET. “For all practical purposes we are right at the national average. But our low labor force participation rate is still ranked near the bottom among the states.”

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 1,800 jobs in June 2016 from the month before and was up 22,500 positions since June 2015.

“June’s job report showed a sharp pick-up, especially when compared to the tepid performance in April and May when the number of jobs shrank on a monthly basis,” said Shanker. “Though average weekly earnings have softened considerably across the board, especially when compared to last year.”

Nonfarm data is provided by the Bureau of Labor Statistics’ Current Employment Statistics program. According to this survey, seven of Kentucky’s 11 major nonfarm North American Industry Classification System (NAICS) job sectors registered gains in employment, while four declined from the previous month.

The construction sector jumped by 1,300 jobs in June 2016 from a month ago. Since June 2015, construction jobs have risen by 800 positions.

“The strong upward movement in construction jobs was accompanied by an almost 5 percent increase in hourly earnings in response to demand for workers in heavy and civil engineering projects,” said Shanker.

Kentucky’s professional and business services increased by 1,100 positions in June 2016 from a month ago. Year-over-year, there was a gain of 3,400 jobs. This category includes establishments engaged in services that support the day-to-day activities of other organizations, including temporary employment services and payroll processing.

Employment in the other services sector, which includes repairs and maintenance, personal care services, and religious organizations, grew by 900 positions in June 2016 from a month ago. This sector has decreased by 500 jobs from a year ago.

The financial activities sector expanded by 600 jobs in June 2016 from a month ago. The sector has added 2,800 jobs since last June.

The educational and health services sector added 400 positions in June 2016, and there was a robust gain of 8,700 jobs from a year ago.

The government sector, which includes public education, public administration agencies and state-owned hospitals, rose by 200 jobs in June 2016 but lost 3,100 positions compared to last June.

The information sector gained 100 jobs in June 2016. This segment has declined by 1,400 positions from a year ago. The industries in this sector include traditional publishing as well as software publishing; motion pictures and broadcasting; and telecommunications.

“Despite the slight uptick in June, the industry has been in a slow decline for almost eight years, as the traditional media tries to figure out how to be profitable in an ever-changing landscape of electronic news and entertainment,” said Shanker.

Kentucky’s manufacturing sector declined by 100 jobs in June 2016 compared to the previous month. Since June 2015, employment in manufacturing has increased by 2,500. Durable goods account for two-thirds of the manufacturing sector and grew by 3 percent from a year ago with the addition of 4,600 jobs, whereas nondurable goods lost 2,100 jobs over the year.

Employment in the mining and logging sector decreased by 300 jobs in June 2016 from a month ago. The industry has declined by 2,900 positions from a year ago.

Kentucky’s trade, transportation, and utilities sector fell by 1,000 jobs in June 2016 from a month ago. This is the largest sector in Kentucky with nearly 400,000 jobs accounting for one-fifth of all nonfarm employment. Since June 2015, this sector has expanded substantially with a gain of 10,500 jobs. Retail trade added 100 jobs over the previous month, and expanded by 6,900 jobs over the year while transportation and warehousing lost 1,100 jobs from a month ago but gained 3,600 positions over the year.

The leisure and hospitality sector dropped by 1,400 jobs in June 2016 from a month ago. Since June last year, the sector has added 1,700 jobs. This sector includes arts, entertainment, recreation, accommodation, and food services.

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.

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