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Timothy Dunne |

Vice President

Timothy Dunne

Timothy Dunne is a former vice president and economist of the Federal Reserve Bank of Cleveland.

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Economic Trends

Fourth District Employment Conditions

by Tim Dunne and Cara Stepanczuk

April’s employment report showed slowing conditions in the District’s labor markets. The Fourth District’s unemployment rate jumped 0.4 percentage point in April to 5.4 percent. This compares to a much smaller national rise of 0.1 percentage point. The rise in unemployment reflects a 6.8 percent increase in the number of unemployed people and a decline in the number employed of −0.3 percent over the month. On a year-over-year basis the news is somewhat better. Since last April, District employment increased by 0.7 percent as the labor force grew (+0.6 percent), and the number of persons unemployed fell by −1.2 percent. To be sure, the year-over-year performance of the District’s labor markets still lags national growth. In May, the national unemployment rate was 4.5 percent, which was unchanged from April.

Of all the District's counties, 19 had an unemployment rate below the national average in April and 150 had a higher rate; the comparative rates were slightly worse than last month. The labor market in Pennsylvania was relatively strong, as the unemployment rate inside the District’s Pennsylvania borders was below the national unemployment rate (4.3 percent and 4.5 percent, respectively). Both Fourth District Kentucky and Ohio unemployment rates (5.3 percent* and 5.7 percent, respectively) were much higher than the national rate. Moreover, unemployment rates varied markedly across the District’s major metropolitan areas. While Pittsburgh and Lexington had unemployment rates below the national rate—each averaging 4.1 percent—other District metro areas had rates as much as 1.7 percentage points higher than the national average (Toledo, at 6.2 percent).

With a 12-month employment growth rate of 2.0 percent, Lexington was the only major metropolitan area in the District to increase employment by over 0.5 percent during the year, and it even outpaced the national employment growth rate (1.5 percent). Since last April, nonfarm employment dropped in Cleveland (−0.4 percent) and Dayton (−0.8 percent), the weakest-performing major metropolitan areas in the District. Goods-producing employment fell in the major District metro areas and nationally, except for Lexington. Service-providing employment fared better and increased in five of the seven major metro areas. Again, Lexington (2.4 percent) was the only area to outpace national growth (1.8 percent) in the service-providing sector. The education and health services industry posted job gains in all major District metro areas, except for Dayton (−0.2 percent), and the professional and business services sector posted job gains in all major District metro areas, except for Cleveland (−0.1 percent) and Dayton (−0.2 percent). The leisure and hospitality industry was either flat or growing in all metro areas in the District over the past year, and it was particularly strong in Lexington.

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*Note: When this article was originally posted, this number was misreported as 6.4 percent.[back]