2013 developments in the Fourth District's labor market
The pace of recovery in the Fourth Federal Reserve District’s labor market slowed in 2013, while the nation’s picked up, according to the most recently available data. This is a shift, as the District’s unemployment rate had been below the national average for much of the recovery. Time will tell for sure which patterns will persist, as one of the biggest challenges in assessing recent regional or local employment performance is that the data are often subject to sizeable revisions.
At the end of 2012, the District’s unemployment rate, at 7.2 percent, was more than half a percentage point lower than the US average of 7.8 percent. Only a few months prior, the District’s unemployment rate was almost a full percentage point lower than the national average. But by the end of 2013, the District could no longer boast the better unemployment rate: During the year, the nation’s unemployment rate fell 1.2 percentage points to 6.7 percent, while the District’s fell only 0.3 percentage points to 6.9 percent (figure 1).
By the end of 2013, the District could no longer boast a better unemployment rate than the nation's.
Changes in unemployment rates across the District’s metropolitan statistical areas (MSAs) during 2013 show, like the District itself, less-robust improvement in labor market conditions. Of the 19 MSAs located at least partly in the District, nine are among the nation’s 100 most populous. These nine, which we will call the District’s major MSAs, accounted for almost 70 percent of its employment in 2013. At the end of 2012, unemployment rates for seven of the nine major MSAs were less than the national average.
However, a year later, this was true for only three of them—Columbus, Pittsburgh, and Lexington. For the two MSAs that had higher unemployment rates than the US at the end of 2012—Toledo and Youngstown—these changed from being 0.1 and 0.2 percentage points higher than the US average at the time, respectively, to more than a percentage point above it by December 2013 (figure 2).
We see similar patterns in another survey that tracks employment. At the end of 2012, the District had seen slightly stronger cumulative employment gains during the recovery than the US, but because US employment grew at a rate that was about twice as fast as that in the District in 2013, this was no longer true by the end of last year. A few District MSAs kept pace with the nation. For instance, Columbus and Cincinnati experienced employment growth of about 1.5 percent in 2013, close to the national growth rate of roughly 1.7 percent. Akron grew faster than that at about 2.1 percent. But two metro areas in the District experienced outright employment declines: Pittsburgh’s employment fell slightly in 2013, while Dayton’s declined almost a full percent.