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State's jobless rate dips, but decline could be temporary

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Indiana's unemployment rate in August fell below double digits for the first time since April, the Indiana Department of Workforce Development said this morning, but the decline could just be a blip. 

The August seasonally adjusted unemployment rate of 9.9 percent represented a decline of 0.7 percentage points from July.

The number of unemployed Hoosiers fell to 307,122 in August from a revised 332,826 in July.

“Decreases in unemployment are always welcome news,” said Teresa Voors, commissioner of the Indiana Department of Workforce Development. “We hope it’s a trend, but data from two key factors used to determine employment levels—surveys of individual household and business payroll—appear to contradict each other.”

The state said its monthly survey of households found 24,000 fewer unemployed Hoosiers, but a separate survey of business payroll reported 21,000 fewer jobs. The separate findings do not jibe, the state said, because a decrease in jobs typically leads to an increase in unemployment.

“The next few months should provide evidence of a trend or a one-month survey anomaly,” Voors said.

William Rieber, an economics professor at Butler University, said it was too early too tell whether unemployment has peaked during this recession. Many economists expect jobless rates to keep rising at least until next year.

“You have to be careful with one-month changes,” Rieber said. “But if you combine that with what [Federal Reserve] Chairman [Ben] Bernanke said (earlier this week)—that the recession is over—it’s encouraging. But [the rate] is still very high.”

Indiana’s unemployment rate is still up significantly from a year ago. In August 2008, it stood at 6 percent.
 
The non-seasonally adjusted jobless rate in the Indianapolis metro area was 8.9 percent in August, down from 9.4 percent in July, but up from 6.1 percent in August 2008.

Roughly 40,800 people are unemployed in the metro area, according to the latest figure.

Comparisons of metro areas are most accurately made using the same months in prior years, because the government does not adjust the figures for factory furloughs and other seasonal fluctuations.
 
Bureau of Labor Statistics numbers show Indiana is among just four states with an unemployment rate decrease over the past month.

Indiana's neighboring states reported smaller changes in unemployment. The unemployment rate in Illinois dropped 0.4 percent, to 10 percent. Ohio's decreased 0.4 percent, to 10.8 percent. Kentucky remained flat, at 11.1 percent. Michigan increased 0.2 percent, to 15.2 percent.


 

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