Issued Friday, October 19, 2018
IOWA CITY, Iowa (Oct. 19, 2018) — A large drop in Iowa payroll jobs in September followed an increase in August, while the unemployment rate stayed at an 18-year low of 2.5 percent.
The Iowa Policy Project released the following statement from Research Associate Natalie Veldhouse about the latest seasonally adjusted jobs data from Iowa Workforce Development (IWD) and the U.S. Bureau of Labor Statistics (BLS).
"Though a low unemployment rate is a good thing, factors such as wage stagnation and gains skewed toward the top, slow job growth, and racial disparities in poverty rates and income show a fuller picture of Iowa's economy.
"Jobs were down in September by 3,400, following a 2,500 increase in August. We saw increases in two of the 11 major job sectors in September, which brought Iowa to 1.590 million jobs.
"Last month left Iowa jobs 17,600 ahead of where they stood in September 2017. That 12-month increase is only a 1,500 average bump per month. The average through the first nine months of 2018 is only 800 per month. This pace of job growth falls short of what is needed to fully bounce back from the Great Recession, almost a decade after recovery began.
"Keep in mind that the payroll (nonfarm) job count and unemployment rate are pulled from different surveys. The unemployment rate is measured by a household survey that assesses the size of the employment pool, or how many people are unemployed but looking for work. Job growth is calculated by looking at jobs added in an employer survey, but does not exactly capture how many jobs are available or take job quality into account. Therefore, it is possible to see low unemployment paired with slow job growth or job declines."
The Iowa Policy Project is a nonpartisan, nonprofit research organization in Iowa City that has been tracking Iowa job issues since its founding in 2001. Find reports at www.iowapolicyproject.org.
• Iowa nonfarm jobs fell by 3,400 to 1,590,100 in September, 17,600 ahead of September 2017.
• Iowa's unemployment rate stayed at 2.5 percent, its lowest level in 18 years. That compares with 3.0 percent a year earlier.
• Only 2 of 11 major job categories showed gains in September — led by 1,500 in "other" services, which includes jobs anywhere from equipment and machinery repair to grantmaking and pet care services. Professional and business services gained 500.
• Declines in five sectors included two in large job sectors — government (3,500) and manufacturing (600). Four categories were unchanged.
• Over the year, manufacturing has gained the most, 8,900. Construction (5,300); professional and business services (2,900); and financial activities (2,200) showed the next largest increases among the seven sectors with net gains over the 12 months.
• Four categories declined over the previous 12 months — government (1,200); "other" services (1,100); leisure and hospitality (1,100); and information (200).
Job Growth Perspective
• Iowa jobs still have not recovered from the Great Recession when accounting for population growth. According to the Economic Policy Institute, Iowa would have had to gain 104,400 net nonfarm jobs to keep up with 6.8 percent population growth since the December 2007 start of the last recession, but has gained back a net of 64,900. This leaves a jobs deficit of 39,500.