County jobless rate jumps in January

January saw a large jump in unemployment in Elkhart County, according to data released today by the state, but increased job numbers have state and local leaders mystified by the unemployment increase.

Posted on March 18, 2013 at 1:00 a.m. | Updated on March 18, 2013 at 11:08 a.m.

GOSHEN — Elkhart County saw a large jump in its unemployment rate in January, rising a full percent from December to reach 10.3 percent the first month of this year.

The Indiana Department of Workforce Development released county-by-county and metro-area data March 18. Alongside those they released data showing large increases in employment levels across the state.

Statewide, unemployment rose 0.3 percent to 8.6 percent. It wasn’t because of people losing jobs, though. The DWD attributed the jump to reported workforce growth of 14,000 for the month, including nearly 10,000 people returning to look for work. It was the largest one-month expansion of Indiana’s labor force since November, 1993, according to the DWD.

That comes with 8,200 job gains reported in Indiana in January, according to the DWD.

The numbers coming from the U.S. Department of Labor’s Bureau of Labor Statistics have state and local leaders scratching their heads.

DWD Commissioner Scott Sanders said, “it is very confusing when BLS has survey data from 5,000 businesses showing continued increases in employment, while the household survey continues to show employment below what businesses are reporting.”

Elkhart County showed a labor force of 91,182 people in January, up from 90,846 in December. A year before it was 89,309, according to the BLS figures provided by the state. January saw a drop of 500 jobs from December, but roughly 2,500 more jobs than in January, 2012.

Elkhart County’s unemployment numbers aren’t seasonally adjusted, and while January’s numbers reflect a downward trend in unemployment over previous years — in January, 2012 the unemployment rate was 11.2 percent, and the year before it was 12.2 — the December-to-January jump didn’t happen in those previous years.

David Daugherty, president of the Goshen Chamber of Commerce, said he has a hard time believing the unemployment numbers are accurate. “That just doesn’t match up with what I’m seeing, with what I’m hearing at our Sound of the Economy events,” Daugherty said. “That number just doesn’t ring true at all to me,” and he’s questioned the unemployment figures for the last six months or so.

Kyle Hannon, president of the Greater Elkhart Chamber, said he, too, has been suspicious of the unemployment numbers for a while. “They haven’t seemed right to me for a while, but they at least seemed to be moving in the right direction,” Hannon said. With January’s numbers, though, “That doesn’t make sense.”

He explained, “I know places are still hiring. Lots of folks are looking for good workers, lots of companies are expanding.”

Daugherty said, “Go to the industrial park. They’re parked all over the place,” with businesses expanding and RV companies and RV suppliers back to pre-recession levels. “I don’t think those numbers reflect what we’re really seeing,” he said.

The unemployment estimates are based on a survey of 1,000 households across the state and are less reliable than the job-creation numbers, which are based on a larger sampling.

Ball State University economist Michael Hicks said the jump in unemployment figures, despite the added jobs, “could be an artifact of the techniques used by the Department of Labor to sample households. It could be caused by changes to seasonal adjustment that appear to have plagued the data over the past few years,” Hicks wrote in a response to the state number.

Daugherty said, “To me the real story is 2,500 more jobs” over the last year in Elkhart County.

Elkhart County’s unemployment picture was better than neighboring St. Joseph (10.8 percent), Marshall and Noble (10.4 percent each) counties. LaGrange County came in at 8.8 percent unemployment, while Kosciusko came in at 8.4 percent unemployment. For the month Elkhart County’s unemployment rate was 42nd in the state.

Hannon said businesses in this area don’t worry too much about the unemployment numbers any more.

It will be interesting to see later figures, Hannon said.“Hang on a month and see if this was an anomaly.”

February state and county numbers are due out March 29.


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