Indiana unemployment rate improves to 12.3%

Indiana’s unemployment rate dropped to 12.3% in May as Hoosiers returned to work after being sidelined by the COVID-19 crisis.

The state’s jobless rate hit a whopping 17.5% in April, according to revised numbers released Friday by the Indiana Department of Workforce Development.

The rate was only 3.2% in March, but that was calculated early in the month, and didn’t reflect the surge in jobless claims over the late part of the month.

The state unemployment rate for May was lower than the national unemployment rate of 13.3%. Prior to the health crisis, it typically was below the national rate.

Friday’s report also revealed increases in the state’s labor force—which is composed of both employed and unemployed-but-willing-to-work residents—and its labor-force participation rate—the percentage of the state’s population that is either employed or actively seeking work.

Indiana’s labor force increased by a net 110,780 workers from April to May, rising from 3.23 million to 3.33 million. This was a result of a decrease of 156,903 unemployed residents and an increase of 267,683 employed residents.

Indiana’s labor-force participation rate decreased from 62.2% in March to 61.4% in April, but bounced back to 63.2% in May. It remained ahead of the national rate of 60.8%.

Private sector employment in Indiana in May increased by 90,100 over the previous month, but was down by 315,000 over the year. Total private employment was 2.42 million, which was 326,500 below the January 2019 peak.

The monthly increase was due in large part to job gains in the Leisure and Hospitality sector 34,700), Manufacturing 18,100) and Private Educational and Health Services 10,700).

Friday’s report broke out unemployment rates for six nearby states, with Minnesota (9.9%), Wisconsin (12%) and Kentucky (11%) reporting lower rates than Indiana’s. Illinois (15.2%), Ohio (13.7%) and Michigan (21.2%) had higher rates.

National numbers

Employers added jobs in 46 states last month, evidence that the U.S. economy’s surprise hiring gain in May was spread broadly across the country — in both states that began reopening their economies early and those that did so only later.

Unemployment rates fell in 38 states, rose in three and were largely unchanged in nine, the Labor Department said Friday. The disparities ranged from Nevada, with the highest rate (25.3%), Hawaii (22.6%) and Michigan (21.2%) to Nebraska (5.2%, the lowest) and Utah (8.5%). The overall U.S. unemployment rate in May was a still-high 13.3%, a decline from 14.7% in April.

All told, the figures illustrate the unusually broad nature of the recession, with all states enduring unemployment rates that soared in April as the coronavirus forced business closures and then generally fell but remained painfully high in May. During the 2008-2009 Great Recession, by contrast, some Midwestern and Plains states such as Iowa and North Dakota managed to avoid high unemployment. Yet in May, Iowa’s unemployment rate was a high 10% and North Dakota’s 9.1%.

At the same time, the viral outbreak has sharpened disparities among the states, with Nevada, with its hard-hit tourism industry, and Michigan, heavily affected by auto job cuts, reporting jobless rates more than double the rates in states like Utah and Wyoming. The gap between the highest and lowest states is slightly worse than during the 2008-2009 downturn.

The virus and the accompanying shutdowns have devastated most states’ economies. Last month, four states recorded their highest unemployment rates on records dating to 1976: Delaware (15.8%), Florida (14.5%), Massachusetts (16.3%), and Minnesota (9.9%).

Nationwide, employers added 2.5 million jobs in April, an unexpected gain that suggested that the job market bottomed out in April and is gradually recovering. Still, the number of people applying for unemployment aid has remained stubbornly high in the past several weeks, a sign that many businesses are still shedding jobs and clouding the outlook for jobs.

Please enable JavaScript to view this content.

Editor's note: You can comment on IBJ stories by signing in to your IBJ account. If you have not registered, please sign up for a free account now. Please note our updated comment policy that will govern how comments are moderated.

{{ articles_remaining }}
Free {{ article_text }} Remaining
{{ articles_remaining }}
Free {{ article_text }} Remaining Article limit resets in {{ count_down }} days.